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Council OK's $500,000 War Chest For Expert Aviation Law Firm Which Also Reps OC's John Wayne Airport; We Post Transcript Excerpt of City Att'y Response To Taxpayer's Concern About Possible Conflict

(May 26, 2002) -- At its May 21, 2000 meeting, the City Council voted 8-0 (Webb absent) to authorize an agreement of up to $500,000 with an outside law firm known for its expertise in aviation legal issues, part of City Hall's efforts to maintain and preserve LB's Airport Noise Compatibility Ordinance.

As previously reported by LBReport.com, the law firm -- Gatzke, Dillon & Ballance, LLP -- currently provides legal services to Orange County's John Wayne Airport (JWA) and has done so for roughly 20 years.

The agenda item, which had been placed on the Council's "consent calendar" where it would not receive individual Council discussion, was publicly discussed because LB neighborhood activist Bry Myown (who indicated she'd read about it on LBReport.com) journeyed to City Hall and pulled the item for public comment and individual Council discussion.

Her testimony prompted drew public responses from Councilman Dennis Carroll and City Attorney Robert Shannon before the vote. We post below transcript excerpts [unofficial, prepared by us] of the pertinent parts of the exchange.

As previously reported by LBReport.com, in March, 2002, Orange County voted (58%-42%) against proceeding with an El Toro airport. [The Gatzke firm was on the side of OC efforts to proceed with the El Toro airport plan.] In the same election, voters ousted incumbent Supervisor Cynthia Coad, who was the swing Board vote supporting the El Toro Airport plan; she will be replaced by grassroots activist (Chris Norby) who opposed an El Toro Airport; Norby's term begins in January. 2003.

One of the arguments used to support an El Toro Airport was that it would reduce pressure to expand John Wayne Airport. Although El Toro airport is now apparently off the table, many residents in John Wayne Airport impacted areas (such as Newport Beach) remain bitterly opposed to John Wayne Airport expansion.

In comments to LBReport.com before the Council vote, attorney Michael Gatzke said he has represented OC in airport related matters since 1978 and represented airports across the country. Mr. Gatzke said he believes "Orange County and Long Beach are actually pretty much in the same place" in seeking to retain their flight limits. He noted OC and LB both involve "two airport proprietors which have a long history of controlling flights and both remain committed to continuing those regulations and doing so under federal law."

Mr. Gatzke noted that an extension of the current John Wayne airport litigation settlement agreement [between City of Newport Beach and two citizen groups, which JWA has operated under since 1985] is about to be finalized and the extension contemplates an increase in John Wayne airport flights. The current settlement expires in 2005.

Mr. Gatzke told LBReport.com that there does not appear to be a conflict at the present time but if "the situation evolved in another way we'd have to address it at that time."

The CA Dept. of Transportation (CalTrans) Division of Aeronautics has published treatise style "California Airport Land Use Planning Handbook" which indicates it was prepared in part in association with Gatzke, Dillon & Ballance.

[begin transcript excerpts]

Ms. Myown: ...I want to begin by thanking City Attorney Shannon for moving with such speed to find such a top notch aviation firm and urging you to amass a war chest for this effort.

From this point forward when you retain counsel, future discussions of this matter will largely occur in closed attorney-client sessions and I fully appreciate that that is right and proper and why it is the case.

But it does mean that tonight is really our last oppportunity for the public to address this item and I was therefore very disappointed to see that it was a consent calendar item on a night when [8th district] Councilmember Webb could not be present...

...I was very concerned to read on LBReport.com that Mr. Gatzke has compared our situation to Orange County's. I think as Councilmembers Carroll and Colonna and Grabinski have noted, we are probably in a stronger position in terms of having an underlying ordinance, greater density and higher pollution. And I particularly urge you to be very careful about a strategy which could be similar to what 5th and 8th district residents experienced in the FEMA [flood insurance] situation when we were lumped with a geographic area whose circumstances were quite different than ours.

I also note that Mr. Gatzke has a current representation for Orange County and as such, it's very easy to imagine that his advocacy on behalf of Orange County...could lead to interests that were contrary to Long Beach's.

And while I know Mr. Shannon has told LBReport.com that he does not believe there is a current conflict, and I think that's probably correct, that [CA lawyers' rules] do require him to disclose any potential conflict and require both parties to sign informed consents, so I question if your vote to retain this firm is your informed consent of a potential conflict.

For all of these reasons, I'd like to request that you lay the item over one week until Councilmember Webb can return and when, although I do not see it in tonight's order of adjournment, the Municipal Code in Section 2 is quite clear that the meeting shall be held in the 5th district. I think that on behalf of 5th and 8th district residents, I would like to see that adjournment order amended and let them be a party to this discussion before we move forward. Thank you so much.

Mayor O'Neill: Thank you. Councilmember Carroll.

Councilman Carroll: Thank you Mayor O'Neill. I am supportive of the item on the agenda tonight, and I want to take this opportunity to thank the legal department, Mr. Shannon and particularly [principal Deputy City Att'y] Mike Mais who along with Bob has done terrific service...in preparing us and preparing our defenses for what I take to be the strong possibility of an onslaught by the air carriers.

Meetings have been held over the past two months, two of them public, and so Ms. Myown does understand I don't think that the issue is going to disappear from public view. As much as can be placed before the public certainly will be...

I do have a question with respect to the decision to retain this law firm. We all are aware, I think, that they have done work in Orange County, also that they are one of the premiere aviation law firms of which there are a limited number, which does raise the issue of potential conflicts. If you hire a firm and they're kind of one of the only ones that do this kind of work, there's always the issue raised of a potential conflicts. And I'm going to invite Mr. Shannon to make any comments that he has on that issue for the elucidation both of the Council and the public and also note, and I believe it is also true, there are ongoing issues right now that would justify the Council making this authorization tonight so we find ourselves having these services available to us immediately, and Mr. Shannon if you do have any comments, I would appreciate them.

City Attorney Shannon: Yes, Madam Mayor and Councilman Carroll, members of the Council. We would request that you give us this authorization tonight. We have been engaged in ongoing discussions with Mr. Gatzke. There is no question that their law firm is the premiere law firm, well versed in what are really very complex issues relating to airport noise damage lawsuits and aviation law in general.

Now we are aware that they do represent the Orange County airport, and for the purposes of a legal conflict, there really is no true potential, real potential of a legal conflict. We are however aware that it is possible that in the future, a position could be asserted by one client that might compromise their ability to fully represent another client. I can assure you we will be on top of that situation and long before that becomes an actuality, we will take steps to see that the city's efforts are not compromised in any way.

One thing we need to keep in mind is, as I said earlier, this is a complex area of law and there are very, very few legal experts in the area. To give you an example, the law firm that we hired in the last litigation which lasted for years and years was a law firm that did then, and does now, represent the Burbank airport in what has been interminable litigation.

So I guess what I'm trying to say is there is a potential with regard all of the experts in this area that some conflict, perhaps not of a legal nature, but conflict in general can occur. We're aware of that. We will not let that happen. And I just want to assure you that we are satsified that this law firm is the best law firm for Long Beach, based upon their expertise, based upon their past record, they've been very successful, they've represented numerous airports, and I'll just go down the line here, they've represented the City of San Jose, San Diego, South Lake Tahoe, and I see here the Kenton County Airport Board of Kenton County, Kentucky, I have no idea where that is (chuckles), that wasn't the reason why we hired them.

And also the financial arrangements that we have with them. They're doing an excellent job for what we believe to be a very good rate.

For all of those reasons, we do believe that you should go forward and permit us to use them as outside counsel and do that tonight.

I would also add that originally I had indicated there would be an extensive closed session tonight, and the reason why we didn't have it is very simple. Mr. Webb is not in town. We will have that closed session as soon as we can in the very near future.

And even before the closed session, I can assure you we are meeting with Mr. Gatzke and we are strategizing our position, which will not necessarily, I hope, result in litigation. Thank you.

Mayor O'Neill: Vice Mayor Baker.

Vice Mayor Baker: Madam Mayor, thank you. The City Attorney addressed the issue of the conflict.

The Mayor called for the vote. The Council approved the item 8-0 [Webb absent].

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