Legal News

Vinson & Elkins to pay $4.35 million to San Diego

By Jason Siegel

Texas-based law firm Vinson & Elkins agreed to pay the city of San Diego $4.35 million to settle a lawsuit that alleged a breach of contract and fiduciary duty as well as professional negligence in its investigation of the city's pension problems, AmLaw Daily reported (here).

The Securities and Exchange Commission and the city's auditor found that "V&E billed the City for unnecessary legal work, billing $6.4 million in fees--the equivalent of a well paid attorney working 8 hours a day, 5 days a week, 50 weeks a year for 10 years--which itself was not only a breach of fiduciary duty...but was also nearly $1 million in excess of the approved contracts and amendments,'" The Texas Lawyer reported in August 2006 (here).

The city paid V&E $6.3 million for two reports that investigated the city's pension crisis and financial disclosure practices, which found no wrongdoing, and to represent the city before the SEC, the San Diego Union-Tribune reported (here).

V&E won't admit any wrongdoing but will repay the city $3.25 million and forgive $1.1 million in outstanding bills, the Union-Tribune reported.

The suit was the fourth by City Attorney Mike Aguirre regarding pension-related attorneys, KPBS reported (LISTEN).

The city dropped V&E and hired Kroll Inc., a New York risk-management firm. Kroll charged $20 million for an investigative report. Aguirre told KPBS he plans to sue attorneys for Kroll.

Full post as published by Legal Pad | LA on June 18, 2008 (boomark / email).