072307 exec session 1
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2 ORIGINAL
3
4 CITY OF SANFORD
5 CITY COMMISSION SPECIAL MEETING
6 MONDAY, JULY 23, 2007
7
8
9 Meeting held at the Railroad Depot Room, 2nd
10 Floor at Sanford City Hall, 300 North Park Avenue,
11 Sanford, Florida, on Monday, July 23, 2007 at 5:30 p.m.,
12 reported by Julie Evans, Court Reporter, Shorthand
410 13 Reporter and Notary Public, State of Florida.
14
15 APPEARANCES:
16 MAYOR LINDA KUHN
COMMISSIONER RANDY JONES
17 COMMISSIONER VELMA WILLIAMS
COMMISSIONER JACK BRIDGES
18 COMMISSIONER ART WOODRUFF
CITY MANAGER ROBERT YEHL
19 ATTORNEY KENNETH W. McINTOSH
STENSTROM, McINTOSH, COLBERT, WHIGHAM & PARTLOW, PA
20 ATTORNEY JOHN T. CONNER
ATTORNEY JOSEPH FLOOD
21 DEAN, RINGERS, MORGAN & LAWTON, PA
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1 P R O C E E D I N G S
2 MR. McINTOSH: I communicated in the hall, in
3 accordance with the usual practice. There are no
4 individuals that are present and in attendance or
5 desire to be in attendance with regard to the
6 matter, 20/20 Media Holdings, Inc., versus the City
7 of Sanford. At this juncture we would respectfully
8 request to move forward, in accordance with Chapter
9 286, with that which is categorized as a "Shade
10 Meeting," for purposes of bringing you up to
11 attention with regard to the matters that we have
12 heretofore sought information and authority from
13 the commission, which occurred on June 14, 2007,
14 beginning at five o'clock.
15 Those individuals that are present at this time
16 are all the members of the City Commission, the
i manager. city manager, the deputy city m a age r. I have
18 released the city clerk in that we have an official
19 court reporter present. The risk manager, Fred
20 Fosson, is present; I am present, as the assistant
21 city attorney, Kenneth W. McIntosh; and Mr. Joe
22 Flood is here, as is our certified court reporter.
23 We may have a visit from Mr. Connor, who you will
24 recall was with us on June 14 in just a minute, but
25 we shall proceed.
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1 MAYOR LINDA KUHN: Thank you.
2 MR. FLOOD: Thank you, Mr. McIntosh. And I
3 understand that it is my duty at this time to
4 request, as the entity's attorney in this
5 litigation, advice from the council at the public
6 meeting, and then the public meeting is to be
7 adjourned and then the private "shade meeting" is
8 to be opened. That's my understanding. It's my
9 understanding also that at the "shade meeting,"
10 although I think this is wrong, public policy -wise,
11 but the statute permits only the City's attorneys,
12 the Commission, and the Executive Officer,
411 13 Mr. Yehl, to be present. So I do want to do that.
14 And I am required to request the advice of the
15 council at the public meeting, and then the public
16 meeting is briefly adjourned, and the private
17 meeting is then initiated; the executive session is
18 opened up for fact finding, and that the time we
19 can conduct that business.
20 MR. McINTOSH: You may proceed to seek
21 instructions at an open meeting, sir.
22 (Attorney McIntosh opened the conference room
23 door.)
24 MAYOR LINDA KUHN: He opened the door.
25 MR. FLOOD: What we need to do is to close the
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410 1 public meeting at this time and then re- adjourn the
2 executive session. And under the statute, the only
3 people that can be present at the executive
4 session, I think unfortunately, are the commission,
5 the city manager, and the attorneys.
6 MAYOR LINDA KUHN: So, then, Mr. Fosson and the
7 deputy city manager will leave the room, and we'll
8 close the public hearing.
9 (Mr. Fosson and Ms. Aday left the room.)
10 MR. McINTOSH: In response to a second call in
11 the hall, there are no individuals that desire to
12 be present with reference to the matter 20/20
411 13 Holdings, Inc., versus City of Sanford.
14 MR. FLOOD: Thank you, Mr. McIntosh.
15 MR. McINTOSH: And Mr. Connor's announcement
16 has been made, in the event that he arrives.
17 MR. FLOOD: The next thing is to open the
18 private executive session.
19 MAYOR LINDA KUHN: And we now open.
20 MR. FLOOD: All right. And I appreciate all of
21 your time. I know John -- I'm Joe Flood, by the
22 way; I'm probably the partner and the attorney.
23 For the record, John Connor is entering, my partner
410 24 at Dean, Ringers. We are the attorneys that
25 handled the litigation of the 20/20 Media case,
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411 1 versus the City of Sanford. And we are requiring
2 or requesting your assistance formally.
3 We recently had a mediation conference which
4 lasted virtually all day. And I'm pleased to
5 report, as pleased as you can be to report when
6 there are -- where the amount involved is as
7 significant as this, and of course I would like to
8 be able to report that the case settled for $5 or
9 that we received a summary judgment, but given the
10 posture of the case and the potential risks of the
11 case, I'm pleased to report that the mediation
12 resulted in a mediation settlement agreement. And
411 13 I have a copy for each member of the council and
14 for the city manager of that mediation settlement
15 agreement.
16 At the mediation there were several lawyers and
17 parties, so at the conclusion of the mediation, the
18 lawyers and the mediator sit down and, you know,
19 old - school a mediation agreement in hand. The
20 terms of the mediation settlement agreement -- of
21 course the first part is, it is subject to approval
22 by yourselves as the council -- it requires a
23 payment of $267,000 by the City to 20/20, which
III 24 encompasses all potential damages including
25 attorney's fees and costs. That payment, if
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410 1 approved, must be made on or before August 3rd.
2 It includes the execution of a complete release
3 and hold harmless agreement by 20/20 of the City
4 regarding the litigation, and an agreement that the
5 contract, which is the subject of this case, will
6 be null and void and neither of the parties will be
7 further bound.
8 It further provides that 20/20 will not have
9 any further dealings with the City and will not
10 attempt to resubmit proposals or RFPs for the
11 shelter work. We did not want to get into a
12 situation where they would submit such a proposal
411 13 which might get turned down, if somebody else could
14 be turned to, and then there would be yet another
15 claim that we retaliated against them for this
16 litigation.
17 So while the settlement amount is certainly not
18 an insubstantial amount, given the risks posed in
19 the case, which I understand my partner, John
20 Connor, went over at some length at the previous
21 Executive Session, we believe that it is certainly
22 within -- well within the guidelines of the
23 discretionary authority which had been tentatively
411 24 discussed at the previous meeting, and certainly
25 it's in the City's best interests.
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411 1 As an example -- and I brought a copy, I'll
2 just reference it -- but the plaintiffs in this
3 case had an expert report from a well- respected
4 Ph.D in Economics from the University of Central
5 Florida, who would testify and would testify
6 convincingly that the economic damages as a result
7 of the loss of this 20 -year contract were about
8 $1.15 million. We certainly had some arguments as
9 to that, but certainly there would have been a
10 significant economic loss, if a jury were to
11 determine, or a judge, that the contract was
12 breached.
411 13 In addition, we were provided information at
14 the mediation that, up through the date of the
15 mediation, the plaintiff's attorney's fees and
16 costs for the litigation, which included
17 significant expert fees, were about $220,000.
18 Which means that, had we gone to trial -- had we
19 gone to trial, that figure would have been
20 increased, probably 50- to $100,000. So if had we
21 gone to trial and got what I believe would probably
22 be a victory and got an award of 50- to $100,000 by
23 the jury, the ultimate verdict or the ultimate
411 24 judgment would have been significantly more than
25 the settlement agreement. Because the contract,
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111 1 the transit shelter license agreement, does provide
2 for prevailing party attorney's fee, 20/20 would
3 have been entitled to an attorney's fee, which
4 after trial I would estimate would have been in the
5 300- to $350,000 range, instead of $220,000.
6 MR. JONES: Even if they were awarded a dollar,
7 we still would owe?
8 MR. FLOOD: Probably. A dollar makes it a
9 little more dicey, because then we would have an
10 argument that they really didn't prevail.
11 MR. JONES: Sure.
12 MR. FLOOD: But had they gotten -- I mean, they
411 13 were going to be trying to get over a million
14 dollars. We were in Osceola County, and I think
15 it's likely that they certainly would have gotten
16 at least 50,000. And then they would have been
17 entitled to that significant attorney's fee award.
18 MAYOR LINDA KUHN: Commissioner Bridges was not
19 here, and Commissioner Woodruff, you were not here,
20 but I think at the end of the day, when
21 Commissioner Jones and Commissioner Williams and I
22 talked with Mr. Connor, I think we had authorized
23 up to $400,000.
411 24 MR. FLOOD: That's correct.
25 MAYOR LINDA KUHN: So this figure is a figure
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411 1 that I'm happy with, actually.
2 MR. FLOOD: Well, and I appreciate that.
3 It is -- at the mediation -- and I was very
4 surprised, because we had previously made some
5 offers, formal offers, that did not include
6 attorney's fees, and the offers we were making at
7 the mediation, that the Plaintiff 20/20 was
8 actually responding to, actually were less than the
9 offers that we had made formally in pleadings.
10 And, for your information, their demand at
11 mediation was $1.3 million.
12 And I don't know to what extent John Connor
13 went into this at the previous meeting, but the
14 last dealing, the last official dealing we had with
15 20/20 was this August 22nd, 2001 memo from the City
16 to 20/20, which is a little ambiguous, about whose
17 -- is the ball in their court or is the ball in our
18 court, about who is do what. And John actually had
19 met with Diane Cruz, who was the commission
20 liaison, whose testimony would have been very
21 damaging and basically indicated that it was her
22 understanding, after a meeting at this time, that
23 the ball was in our court.
410 24 And there is nothing else from August 2001, no
25 communications, no memoranda, no telephone notes,
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411 1 nothing, from then until December 18th, when
2 instead of sending a Notice of Default, which the
3 contract requires -- I'm believing that you've seen
4 the provision of the contract?
5 MAYOR LINDA KUHN: Mm -hm.
6 MR. FLOOD: A determination that requires, you
7 can't just terminate the contract; it requires a
8 60 -day Notice of Default, and giving the other
9 party in this case, 20/20, 60 days opportunity to
10 cure. Rather than doing that, after having no
11 communication from August 22 until December 18, a
12 termination letter was sent, which we believe very
410 13 likely would have been determined to be an improper
14 termination. The proper procedure would have been
15 to give notice of the default.
16 MR. McINTOSH: Share with the commissioners who
17 were not present the significance of the Osceola
18 venue.
19 MR. FLOOD: Well...
20 MAYOR LINDA KUHN: It was significant. Let's
21 just say that.
22 MR. FLOOD: It was very significant, obviously.
23 COMMISSIONER JONES: Joel Davis is a
ill 24 businessman who has been connected very closely
25 with Osceola County for years and years and years,
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411 1 has a contract with them saying anything that
2 happens at all is going to happen in Osceola
3 County.
4 MAYOR LINDA KUHN: Venue had to be Osceola
5 County.
6 MR. FLOOD: That's exactly right. Mr. Davis
7 is, as you point out, Commissioner, a fairly well
8 connected businessman, whose offices -- his primary
9 connections are through Osceola County; he is
10 politically connected there, a very savvy
11 businessman. Coupled with the fact that, at least
12 when you have a jury in your home county -- and we
410 13 would certainly have hoped to have Sanford
14 residents as our jurors -- they have to think that
15 when they're rendering that verdict that if they're
16 going to do it, it's money that ultimately is going
17 to come from their own pocket. An Osceola County
18 jury isn't going to care how they spend the City of
19 Sanford's money at all. And they obviously are
20 going to have more sympathy, probably, for their
21 own.
22 So that was a very significant thing. And the
23 reason that we had that also, by the way, the
110 24 contract, the transit shelter license agreement
25 specifically held or provided for an Osceola County
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410 1 venue, which the Court upheld, even though it was
2 challenged. So that made it much more difficult as
3 well. I think we would have done much better were
4 this in Seminole County.
5 MAYOR LINDA KUHN: Well, it is -- Joe, just so
6 you'll know, it is on our agenda this evening for
7 approval. After having spent a significant amount
8 of time with Mr. Connor, listening to the case,
9 like I said, I think that this figure is probably
10 -- I don't think we'll do much better.
11 MR. FLOOD: I agree.
12 MAYOR LINDA KUHN: Like I said, it's on the
411 13 agenda this evening for approval.
14 MR. FLOOD: It's my understanding that
15 Mr. Davis himself will be here for the public
16 meeting.
17 MAYOR LINDA KUHN: Well, this is on our consent
18 agenda.
19 MR. FLOOD: For what it's worth --
20 MAYOR LINDA KUHN: He just wants to be there
21 and hear us vote, mm?
22 MR. FLOOD: I suppose. And I don't think there
23 needs to be any discussion or the amount.
24 MAYOR LINDA KUHN: It is on the consent agenda.
25 MR. McINTOSH: When an item is on the consent
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1 agenda, there can't be any discussion.
2 MR. FLOOD: All right. Just a motion to
3 approve the settlement, approved, and move on.
4 MAYOR LINDA KUHN: Right.
5 MR. FLOOD: But he may be there. And I don't
6 know if the press would come for something like
7 this; I can't imagine that they would, but you
8 never know.
9 MAYOR LINDA KUHN: And maybe this isn't the
10 right venue, but as I think at the end of the
11 meeting before said, I know that this contract was
12 approved by the commission and then kind of
410 13 negotiated and signed by the former mayor. Just as
14 a precaution, I'd like to see that somehow, whether
15 it be by ordinance or by charter, that all future
16 contracts for the City of Sanford have to be
17 reviewed by our legal counsel.
18 MR. YEHL: Well, they do and this one was. And
19 in addition to that, as I understand it, staff was
20 given direction to make some changes, particularly
21 as it related to the venue, and that was not done.
22 And that staff person isn't with the City.
23 MAYOR LINDA KUHN: Any longer?
110 24 MR. YEHL: Any longer.
25 MAYOR LINDA KUHN: It's probably a good thing,
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110 1 isn't it?
2 MR. YEHL: It's probably a good thing. It is
3 for me and my blood pressure.
4 COMMISSIONER BRIDGES: Since I wasn't at the
5 last meeting, I spent a significant amount of time
6 with Mr. Flood, who I know as Joe, and I've known
7 him since he came to Sanford. I hate to put this
8 on the record, Joe, but you're a damn good lawyer.
9 MR. FLOOD: Type this up.
10 MAYOR LINDA KUHN: I used to work with Joe.
11 COMMISSIONER BRIDGES: We tried the case for
12 about three or four hours over a round of golf, and
13 then Joe has been kind enough to keep me abreast.
14 And the plain facts are, we had a bad contract; we
15 had bad administration of the contract; we had
16 venue in Osceola County. And if they had hit a
17 home run, we could have been looking at a million -
18 three to a million -five. I told Joe that if he
19 could get us out for less than half a million --
20 and I don't like paying anybody a dime, but when
21 you're wrong, you're wrong. And I think Joe and
22 his firm has done a great job for us.
23 I appreciate you doing it gratuitously.
• 24 This is only the second executive session I've
25 ever set through, I don't know if it's procedurally
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411 1 appropriate that we move to approve, here in
2 executive session?
3 MAYOR LINDA KUHN: No.
4 MR. FLOOD: That's a great question. That has
5 to be done at the public session.
6 COMMISSIONER BRIDGES: My two cents worth is,
7 we write them a check and don't ever make the damn
8 mistake again. Venue in Osceola County, my God.
9 What I told Joe is, I'm sitting in Osceola County
10 and I'm going to nail a municipality up in
11 Sanford: "Sanford is a city, and it's the biggest
12 city in the county seat; they've got plenty of
410 13 money, and it's no money off our back." So I have
14 to applaud Mr. Davis. I mean, give the devil his
15 due. And how it got past staff, well, that's
16 historical. But I think --
17 MR. JONES: Well, I've got an idea.
18 MAYOR LINDA KUHN: Certainly not on the record.
19 COMMISSIONER BRIDGES: We approve it; Linda
20 signs it, as the mayor of the city; and we fund it,
21 and be done with it.
22 COMMISSIONER WILLIAMS: Well, I have a question
23 I want to ask. Because it is concerning the
110 24 agenda. Do you still have to put it off and
25 approve it? Is that what you're saying?
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411 1 MAYOR LINDA KUHN: No.
2 COMMISSIONER WILIAMS: Just approve at the
3 consent agenda?
4 MR. FLOOD: At the consent agenda, at a public
5 meeting that the public at least has the right to
6 be at. The government can't take any official
7 action.
8 COMMISSIONER BRIDGES: Like Mr. McIntosh says,
9 on the consent agenda, it does not allow
10 discussion and yee -haw, and "I got you," and second
11 guessing, and "Why are we doing this ?"
12 Let's do it and be done with it.
411 13 MAYOR LINDA KUHN: That's why it's on the
14 consent agenda.
15 COMMISSIONER BRIDGES: Right. And I assume we
16 have the funds to pay it?
17 COMMISSIONER WOODRUFF: Where is it coming
18 from?
19 MAYOR LINDA KUHN: It will have to come out of
20 reserves.
21 MR. YEHL: Technically, it could -- I mean, it
22 might have required a budget adjustment. But the
23 fact that you're approving this is, in fact, I
411 24 think, recognition that the only place the money is
25 going to come from is reserves. We don't have this
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411 1 kind of change floating around.
2 MR. FLOOD: I certainly appreciate the kind
3 words from Mr. Bridges, and I appreciate
4 Mr. McIntosh and the council setting this up. I
5 think its an excellent settlement, for what its
6 worth. It's a case that's always concerned me
7 somewhat. The result, I think, was the result of a
8 great deal of hard work by John. And Fred Fosson,
9 your risk manager, shouldn't be overlooked either.
10 He did a great job at the mediation, which was
11 quite contentious, I have to say, with people
12 storming out.
411 13 MAYOR LINDA KUHN: That's what mediations are
14 usually about, isn't it, Joe?
15 MR. FLOOD: Sometimes they are, and this one
16 certainly was. But I'm pleased we were able to get
17 it done.
18 With regard to the comment about attorney's
19 fees, after I heard the amount of fees that had
20 been charged to the plaintiff and I know that we
21 have done more work than the attorneys for the
22 plaintiff, and it's significantly more than our
23 fees...
24 MAYOR LINDA KUHN: Adjust his rates, hm?
41)
25 COMMISSIONER BRIDGES: The under - billing theory
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1 is coming?
2 MR. FLOOD: I thought there could be a slight
3 adjustment.
4 No, our firm, we've represented and had the
5 pleasure to represent the good folks at the City of
6 Sanford for many, many years and appreciate the
7 opportunity. And it is always a pleasure to work
8 with all of you.
9 MR. McINTOSH: We move to introduce one of
10 those agreements in the record, if you do not
11 mind.
12 MR. FLOOD: No.
13 MR. McINTOSH: John and I talked about it, and
14 I have a copy I can give to Linda.
15 MR. FLOOD: I agree; I think that copy has to
16 be attached to the transcript. It does not have to
17 be referenced at the consent agenda meeting.
18 Just so all of you know, and you probably do,
19 at the time that this case becomes complete and
20 that the plaintiffs actually execute the release
21 that they're required to execute and dismiss the
22 case with prejudice, this transcript then becomes a
23 public record.
411 24 MAYOR LINDA KUHN: Right.
25 MR. McINTOSH: You will let us know in writing
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• 1 when that comes about, and we will not release it
2 from the clerk's office until we get the written
3 declaration.
4 COMMISSIONER BRIDGES: So in the interim, do
5 you want these back?
6 MR. FLOOD: Yes.
7 MAYOR LINDA KUHN: If there's no further
8 business, then I guess this meeting is adjourned.
9 MR. FLOOD: And I believe, Ken, correct me if
10 I'm wrong, that the next thing procedurally is that
11 the public meeting is then reopened, and you
12 announce the adjournment of the executive session
13 at the public meeting.
14 MR. McINTOSH: Let me open the door first.
15 MAYOR LINDA KUHN: So we've reopened the public
16 hearing. And there being no further business, this
17 meeting is adjourned.
18 (Thereupon, the meeting was concluded at
19 6:05 p.m.)
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1 C E R T I F I C A T E
2 STATE OF FLORIDA
3 COUNTY OF SEMINOLE
4
5 I, JULIE EVANS, COURT REPORTER, certify that I
6 was authorized to and did stenographically report the
7 foregoing proceedings; and that the transcript is a true
8 and complete record of my stenographic notes.
9
10 I further certify that I am not a relative,
11 employee, attorney, or counsel of any of the parties,
12 nor am I a relative or employee of any of the parties'
13 attorneys or counsel connected with the action, nor am I
14 financially interested in the action.
15
16 Dated this 31st day of July, 2007.
17
18 n�7
19 hc)i.CA,
JULIE EVANS, SSR
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