Saying the city won but isn’t done, its top attorney in the Mountain Water case said Wednesday the utility’s former owner is still working to drive up costs by protracting the case in a series of appeals and deadline extensions.
But Natasha Jones of Boone Karlberg added that the end is near, given that one lingering appeal was recently resolved by the Montana Supreme Court in the city’s favor, leaving just two ancillary matters left undecided.
“At the same time this case was being litigated, we were fighting other battles in other courts because of the opponents we had,” Jones said. “While we were driving toward a win – and that’s what we received through a settlement agreement last June by taking ownership of the water system – we were also having to defend the city in other forms.”
As the city fought to take public ownership of the private utility, its attorneys were also fighting parallel cases in other courts, Jones told members of the City Council during Wednesday’s regular update.
One included Liberty Utilities Co. and the Carlyle Group, which transferred ownership of the utility in the “dark of night” without receiving approval from the Montana Public Service Commission. Another case saw Mountain Water sue the Montana Department of Revenue.
The city won in both instances, just as it did with several others on its way to winning the larger condemnation case.
“Our opponents were using every avenue to attack the city’s ability to condemn the water system,” Jones said. “We won, but we’re not quite done.”
Wednesday’s update was requested in part to satisfy the criticisms of council member Jesse Ramos, who has voted against paying the city’s legal bills because, he claims, he hasn’t been privy to the services being performed by its attorneys (see related story).
But council member Bryan von Lossberg said the City Council has met with the mayor and the city’s legal team more than 60 times since 2014 to review matters associated with the water system’s acquisition, including legal issues and attorney fees.
It was disingenuous to claim the city wasn’t being transparent, he said.
“It’s worth mentioning, by way of context, that we’ve been having this sort of review with the administration and the attorneys for some time,” von Lossberg said. “That to me is part of being accountable and transparent, and it’s an opportunity for council members to ask questions.”
On May 8, the Montana Supreme Court upheld a lower court ruling which found that Carlyle wasn’t entitled to post-summons interest accrued on the utility, or the value it gained after the city initiated condemnation proceedings several years ago.
Jones said the recent ruling leaves Carlyle with just two outstanding appeals, and both relate to attorney fees. One strikes to the issues raise by Ramos, who contends he has a right to review the case fees and invoices submitted by Boone Karlberg.
The city contends those billing statements represent privileged information, in part because litigation remains ongoing and such invoices typically reveal strategy.
Jones reaffirmed that position.
“As a part of the appeal, the city’s attorneys and expert invoices are part of what’s being litigated right now,” Jones said. “Our opponents consistently requested access to the city’s invoices to both its experts and attorneys, and (District) Judge (Karen) Townsend consistently rejected their attempts to get that information.”
And why would they want that information, Jones asked?
“It’s because those documents contain legal strategy, secrete, private, confidential communications and attorney work product,” she said. “That issue is currently on appeal to the Montana Supreme Court, so the very issue of the city’s invoices is one of the primary issues being considered by the Supreme Court.”