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Kadner: Report by lawyers about lawyer spending

Updated: October 17, 2012 6:34AM



This is a tale of lawyers investigating lawyers who spent a lot of tax dollars.

An investigative report by the law firm of Godfrey and Kahn, commissioned by Oak Lawn, would frustrate and anger most suburban residents.

It’s a terrible story, actually, about the awful things that can happen in a local government when elected officials and the people they hire fail the public they’re supposed to serve.

Oak Lawn once had a village attorney and a group of attorneys acting as special counsel. They spent so much money that some village trustees split politically from the mayor and called for an investigation.

The inquiry was conducted by Evergreen Park attorney Burton Odelson, and a lawsuit later led to the village being reimbursed $500,000 by its special counsel.

Believing there was still more to be learned, village officials retained Godfrey and Kahn to conduct a more thorough analysis of the situation.

Although the law firm’s investigative report covers a lot of territory, I will focus on the primary legal case — a sexual harassment lawsuit brought by firefighter Sharon Januszewski.

The fact that a semen stain was found in her bedding at a firehouse should have been enough to have provoked a quick settlement. But it wasn’t.

Although Mayor David Heilmann and village manager Larry Deetjen urged village trustees to settle that lawsuit quickly, it didn’t happen. Heilmann, according to the firm’s report, later took some actions that may have delayed a quick settlement, despite his initial recommendation.

Newly elected village board members (having pledged to control spending) authorized a maximum $200,000 settlement offer.

Januszewski’s attorney wanted $1 million, although the report contends that her lawyer offered to settle for as little as $350,000 at one point. Whether that information was communicated to all the elected officials is murky.

What is clear is that after years of legal wrangling, the lawsuit cost taxpayers nearly $2 million. Januszewski received $850,000, and the lawyers for the village more than $1 million.

The Godfrey and Kahn report, labeled “privileged and confidential,” describes of series of oversights, misunderstandings, miscommunication and misleading statements resulting in this boondoggle.

For one thing, the village had a new insurance policy that did not cover sexual harassment lawsuits. But elected officials were not aware of this early on, in part because they had replaced the old political establishment.

Worse, the lawyers for the village handling the harassment case apparently failed to check out the village’s insurance coverage. So for a time, it appears, everyone was acting under the mistaken belief that insurance would cover most of the costs.

Only when the law firm ran up legal bills so large that a fund established to pay them ran out did the firm get interested in the insurance coverage out of self-interest, according to the report.

Voters tend to believe that government transitions are seamless. But institutional knowledge gets lost when long-time officeholders and the people they’ve hired are replaced.

In Oak Lawn, this apparently led to a lack of knowledge as to how legal bills were reported. Instead of having all legal bills under one financial heading, they were accounted for in two different places.

Most elected and appointed officials in Oak Lawn apparently didn’t know or understand this or they might have noticed earlier that they were spending far more in legal fees than allowed for in the budget.

Complicating the matter, it seems to me, was the fact that most of the discussions about the Januszewski case took place in closed sessions of the village board. Such meetings can be held to discuss certain topics, such as pending litigation, and the public is told, by municipal attorneys, this is for its own good.

I would suggest that had discussions about this lawsuit taken place in public, residents would have wanted to know early on if the costs were covered by insurance, would have asked how much the lawsuit was costing the village and would have demanded a quick settlement, knowing the facts.

But even this report on government mismanagement and excessive legal fees in Oak Lawn would have been kept secret had it not been for Sandra Bury, a mayoral candidate in the village, who filed a freedom of information request to make it public.

Village officials refused to release the document until Bury asked the Illinois attorney general’s office to intervene.

I can’t help wondering how many suburban governments could withstand the scrutiny of an investigation like this one.

Oak Lawn is run by a mayor who is a lawyer. There is at least one other lawyer on the village board.

But most suburbs, run by part-time elected officials, moms and dads, have little expertise to deal with the details of governing a multimillion-dollar operation.

Yes, they hire professionals to help them. But they also easily dismiss employees for political reasons and sometimes refuse to listen to that advice.

And then they overlook the fact that the advice they’re getting may be motivated by self-interest instead of the public’s interest.

Legal fees in many suburbs are staggering. You would need to hire a lawyer to understand them.

And then you would have to hire another law firm to make sure that they lawyer was telling you the truth.

It’s good work if you can get it.



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