Loading...
2524 Shutts & Bowen - Allstate Ins Co - COSShafts 0A Lt �r imoE- �oUr.c�tcrl City of Sanford Florida 300 N. Park Avenue Sanford, Florida 32771 July 31, 2023 BRETT R. RENTON PARTNER Shutts & Bowen LLP 300 South Orange Avenue Suite 1600 Orlando, FL 32801 DIRECT (407)835-6791 EMAIL BRenton@shutts.com VIA U.S. MAIL and E-MAIL Mr. Wade Fairchild Florida PIP Regional Claim Leader Allstate Insurance Company 8333 Bryan Dairy Road Largo, Florida 33777 Re: Conflict Waiver: Allstate Insurance Company and City of Sanford, Florida Dear Mr. Colbert and Mr. Fairchild: The City of Sanford, Florida ("City") has requested that Shutts & Bowen represent it to assist the City as a Public Service Water entity with status updates attendant to a class action settlement and attendant compilation of data and submission for award concerning a nnllti- district litigation settlement pending in South Carolina concerning AFFF that caused PFAS contamination of ground water. Shutts & Bowen currently represents Allstate Insurance Company and its related entities ("Allstate") in fee schedule litigation under Florida's No -Fault Statute brought by the City. In our view, the matters are completely unrelated and are connected in no way. The purpose of this letter is to confirm the waiver of potential conflict of interest regarding Shutts & Bowen's representation of the City in connection with the above -noted matter, and Shutts & Bowen's representation of Allstate in the current and any future fee schedule litigation brought by the City and/or its affiliates. This letter will confirm your consent to such representation and the waiver by each of you of any conflict of interest. The rules regulating the Florida Bar (the "Rules"), as well as Shutts & Bowen's loyalty to its clients, require that we provide you all explanation of the possible conflicts of interest resulting from our legal representation of the foregoing parties. We believe it is prudent to inform you fully of the terms of our representation and advise that you seek independent counsel on these issues. ORLDOCS 20757223 11"13F.11311: shutts.com FORT LAUDERDALE I JACKSONVILLE I MIAMI I ORLANDO I SARASOTA I TALLAHASSEE I TAMPA I WEST PALM BEACH July 31, 2023 Page 2 Rule 4-1.7 of the Rules does not permit the representation of a client which will be directly adverse to the interests of another client unless (i) a lawyer reasonably believes the representation will not adversely affect the lawyer's responsibilities to and relationship with the other client and (ii) each client consents after consultation. Further, Rule 4-1.7 does not permit the representation of a client if a lawyer's exercise of independent professional judgment in the representation of that client may be materially limited by the lawyer's responsibilities to another client or to a third person or by the lawyer's own interests unless (i) the lawyer reasonably believes the representation will not be adversely affected and (ii) the client consents after consultation. Subject to your consent, Shutts & Bowen will implement an ethical screen, such that the attorneys directly involved providing services to the City will not communicate formally or informally with those attorneys representing Allstate concerning the pending litigation, including without limitation, in-person conversations, telephone and e-mail communications. Tile attorneys providing representation to the City, on the one hand, and the attorneys providing representation to Allstate, on the other hand, shall not share, or access, any paper or electronic files that relate in any manner to the respective parties. We advise you to consult with independent counsel before deciding whether to proceed on this basis. if the foregoing accurately reflects our agreement, and you waive any conflict of interest that may result from Shutts & Bowen representation of any of the parties (after having been advised of the effect and consequences of such waiver), please sign, in counterparts, the Consent and Acknowledgment below and forward all counterparts to my attention at your earliest convenience. Upon our receipt of all counterparts from all parties, we will provide each party a counterpart signed by all parties. Very Truly Yours, Shutts & Bowen LLP T .. 7, i/ r" /r iii/,vr Brett R. Renton ORI.00CS 20757223 1 TB17 TBF shutts.com I FORT LAUDERDALE I JACKSONVILLE 1 MIAMI I ORLANDO I SARASOTA 1 TALLAHASSEE 1 TAMPA I HEST PALM BEACH July 31, 2023 Page 3 CONSENT AND ACKNOWLEDGMENT The undersigned hereby acknowledges receipt of the foregoing letter, consents to the representation referred to therein and waives the conflict(s) of interest as described above. City of Sanford, Florida Allstate Insurance Company By: -1��� By: William Colbert City Attorney Date: 1�1/j- 2 Date: Wade Fairchild Florida PIP Regional Claim Leader ORLDOCS 20757223 1 TBI'.TBI' shutts.com I FORT LAUDERDALE I JACKSONVILLE I MIAMI I ORLANDO I SARASOTA I TALLAHASSEE I TAMPA I WEST PALM BEACH July 31, 2023 VIA ELECTRONIC MAIL City of Sanford, Florida c/o Lonnie N. Groot, Esq. 300 N. Park Avenue Sanford, Florida 32771 luroot custenstrom.com Re: Class Claim in AFFFMDL Settlement Dear Mr. Groot: BRETT R. RENTON PARTNER Shutts & Bowen LLP 300 South Orange Avenue Suite 1600 Orlando, FL 32801 DIRECT (407)835-6791 EMAIL BRenton@shutts.com Thank you for selecting Shutts & Bowen LLP (the "Firm") to represent the City of Sanford, Florida ("Client") with regard to the above -referenced matter. This letter and the enclosed Terms of Engagement will describe the basis on which our firm will provide legal services. This letter will confirm our understanding as to the nature and scope of legal services ("Services") to be performed by Shutts & Bowen LLP (hereinafter "Firm") in the representation of the Client in the above -referenced matter for which Services the Client will be responsible for payment. The points of contact for the Client with respect to the Services is to be Lonnie Groot, Esq. and William L. Colbert, Esq. ("City Attorneys"). 1. Nature and Scope of Services. It is agreed that the Finn shall provide Services consisting of assisting Client as a Public Service Water entity with status updates attendant to a class action settlement and attendant compilation of data and submission for award concerning a multi -district litigation pending in South Carolina styled IN RE AQUEOUS FILM -FORMING FOAMS PRODUCTS LIABILITY LITIGATION, MDL 2873, consolidating all federal actions alleging that AFFF caused PFAS contamination of ground water. In re Aqueous Filnt-Forming Foams Prods. Liab. Litig., 357 F.Supp.3d 1391, 1392 (J.P.M.L. 2018) and a class action settlement for public water service providers ("Services"). We have agreed that the Finns engagement is limited to performance of the Services only. Because we are not general counsel for the Client, our acceptance of this engagement does not involve an undertaking to represent the Client in any other matter. We may agree with you to limit or expand the scope of our representation from time to time, provided that any such change is confirmed by the Firm in writing. City Attorneys shall remain the lead counsel on the matter and the Firm shall provide Services solely at the direction of and upon request of the City Attorneys. The Finn shall not attend any meetings without the express request of the City Attorneys. 2. Attorneys to be Assigned. It is agreed that Partner Brett R. Renton, Esq. will be assigned to this matter by the Firm. Other attorneys and paralegals may be used where deemed appropriate in order to promote efficiency and cost effectiveness. 3. Fees and Billing. The Firm will be compensated by the Client for all Services rendered at the discounted rates of $450.00 per hour for partner Brett R. Renton, Esq. Others shall be billed at their standard rate with a 10% discount applied. The Firm shall provide a written statement of the hours worked per month to the Client and Client should remit payment within thirty (30) days of the invoice. 4. Costs, Expenses, and other Disbursements. The Client shall be responsible for costs and expenses associated with the Finn's rendering of these Services. All costs and expenses billed to the Client will be at the Firni's actual cost, without any mark-up. All billings for allowed costs, expenses, and disbursements must be accompanied by backup documentation, such as invoices from the vendor for services, etc. 5. Other Clients in Unrelated Matters and Conflicts. The Firm has advised, and the Client acknowledges that the Firm currently and, in the fixture, represents other clients that may be adverse to the Client in matters which are unrelated to the current Services. As a material term to the Firm's engagement by the Client, the Client agrees to waive any potential conflicts of interest for the Finn to represent clients in planning, zoning, licensing, land use, contractual and related matters adverse to the Client as long as such matters do not relate to the Services that is the subject of this agreement or representation. Examples of matters involving the Client that would be subject to the waiver described in the preceding sentence include, but are not limited to, land use and zoning matters, procurement matters, public-private and other transactions (other than transactions relating to the scope of Services under this agreement), assisting clients in quasi-judicial proceedings involving the Client, Eminent Domain and affordable housing matters. The Finn has advised, and the Client acknowledges, that the Firm currently represents Allstate Insurance Company, or one of its subsidiaries, attendant to a dispute concerning a charge for emergency response services incurred by the City of Sanford. The Client agrees that this representation does not relate to the Services that is the subject of this agreement or representation, does not constitute a conflict of interest for the Firm and expressly waives any potential conflict of interest. The Client agrees that to the extent future potential conflicts of interest may arise that involve litigation, appeals or arbitration against the Client, that the Client will consider whether it is reasonable for the Client to provide a waiver on a case by case basis depending on the degree to which the Client determines: (1) the new matter is unrelated to these Services; and (2) the sufficiency of the Finn's protocols for ensuring that any lawyers or staff involved in providing Services are separated from any involvement in the new matter. The Client's willingness to issue conflict waivers on these bases shall not be unreasonably withheld. G. Termination and Withdrawal Without Cause. The Client agrees that the Firm may terminate its relationship with the Client or the City Attorneys at any time for any reason. The Firm agrees that the Client may terminate its relationship with the Firm at any time for any reason. No fees shall be paid by Client for Services rendered after the termination of this Agreement. 2 SHUTTS.COM 1 FORT LAUDERDALE I MIAMI I ORLANDO I SARASOTA g TALLAHASSEE I TAMPA I :VEST PALM REACH Additional information regarding fees and other important matters appears in the enclosed Terns of Engagement, which are incorporated as part of this letter and which you should review carefully before agreeing to our engagement. Please indicate your acceptance of the terms of this letter and our Terns of Engagement by signing and returning a copy of each document to me. Please call me if you have any questions. Very Truly Yours, Shutts & Bowen LLP Brett R. Renton AGREED TO AND ACCEPTED: CITY Or SANFORU; By: / t Title: Date: z 3 SHUTTS.COM I FORT LAUDERDALE I MIAMI I ORLANDO I SARASOTA I TALLAHASSEE I TAMPA I WEST PALM BEACH ATTORNEY-CLIENT P NILE E/ 3 PRt ;ll[7CTti . SHUTTS & BOWEN LLP TERMS OF ENGAGEMENT We appreciate your (the `Client") decision to retain Shutts & Bowen as your legal counsel. Although our engagement is limited to the matter(s) identified in the engagement letter that accompanies this attachment, the terms of engagement set forth herein and in that letter will govern the relationship between us (including all of the Client's subsidiaries and affiliates) on this and all future matters, regardless of the scope of any such future legal services, unless modified in a writing signed by both the Client and the Firm. The following summarizes our billing practices and certain other terms that will apply to our initial and any future engagement to represent you. 1. MONTHLY BILLING: We bill monthly throughout the engagement for a particular matter, and our statements are due when rendered. In instances in which we represent more than one person with respect to a matter, each person that we represent is jointly and severally responsible for our fees with respect to the subject of representation. Our statements contain a concise summary of each matter for which legal services were rendered and a fee was charged. We record and bill our time in one-tenth hour (six minute) increments. 2. ADVANCE DEPOSIT AND ESTIMATES: When establishing fees for services that we render, we are guided primarily by the time and labor required; the novelty and difficulty of the legal issues involved; the legal skill required to perform the particular assignment; the fee customarily charged by comparable tires for similar legal services; the amount of money involved or at risk; the time constraints imposed by the client and/or Revised Ane 2014 the circumstances; and the inability to work on other matters in order to devote time to you, the Client. It is the Firm's standard policy to obtain an advance deposit (herein, the "Deposit") upon acceptance of representation in each new matter. The Deposit shall be retained by the Finn in our trust account during the terms of this Agreement and will be used by the Firm to pay costs, expenses and fees for legal services. Upon billing you, the Firm, at its option, and any time prior to payment of such invoice by you, may apply the Deposit to satisfy the invoice. You agree to pay each invoice timely, in accordance with its terms, whether or not the Finn elects to apply all or part of the Deposit to a particular invoice. Upon payment by you of each such invoice to which the Deposit may have been applied, the payment will be used to replenish the Deposit to the level of its original amount. The Deposit, as replenished each month during the term of this Agreement, shall be applied to the Final Bill issued by the Firm following the termination of the Finn's representation under the terms of this Agreement. If the Final Bill amount does not exceed the then -unapplied portion of the Deposit, the excess amount shall be refunded to you. If the Final Invoice amount exceeds the then -available Deposit amount, you shall pay the excess amount upon receipt of the Final Bill. The Deposit required for the legal matter encompassed by this engagement letter has been waived for this matter. As we have discussed, the fees and costs relating to this matter are not predictable. Accordingly, we have made no commitment to you concerning the maximum 4 SHUTTS.COM I FORT LAUDERDALE 1 MIAMI I ORLANDO i SARASOTA i TALLAHASSEE i TAMPA ± WEST PALM BEACH fees and costs that will be necessary to resolve or complete this matter. Any discussion of fees and costs that we may have had represents only an estimate of such fees and costs. It is also expressly understood that payment of the Firm's fees and costs is in no way contingent on the ultimate outcome of the matter since we cannot guarantee any particular result or forecast the outcome of a legal matter with precision and 1.00% accuracy. 3. ANNUAL ADJUSTMENT OF RATES: This Firm annually adjusts its billing rates for lawyers and paralegals. 4. EXPENSES (Costs and Cost Retainer): The Firm may require an advance cost retainer to ensure that funds are available to pay consultants, experts and vendors (e.g. copy services, translators, court reporters, etc.) whose services are engaged on your behalf to assist in the representation. A cost retainer is separate from and in addition to the Advance Deposit referred to in paragraph 2, supra. Any unused funds remaining in the cost retainer at the conclusion of the representation will be refunded to the Client or applied to any outstanding fees owed to the Firm. In addition to legal fees, our statements may include out-of-pocket expenses that we have advanced on your behalf and other charges (which may exceed direct costs) for certain support activities. Advanced costs generally will include such items as travel expenses, filing, recording, certification, and registration fees charged by governmental bodies, facsimile charges, long distance telephone calls, courier services, computer research, photocopying expenses, and court reporter charges. The Firm, however, reserves the right not to advance expenses which exceed $100 and the Client may be asked to pay such expenses in advance. Any unused funds remaining in the cost retainer will be refunded to the Client or will be applied to any outstanding amounts owed the Firm at the conclusion of the representation. 5. THIRD PARTIES SUCH AS EXPERTS AND COURT REPORTERS: During the course of our representation, it may be appropriate or necessary to hire third parties to provide services on your behalf. These services may include consulting or testifying experts, investigators, providers of computerized litigation support and court reporters. Because of the attorney- client privilege and "work product" protection afforded to services that an attorney requests from third parties, in certain situations our Firm, with your consent, may assume responsibility for retaining the appropriate service providers. The Client, however, will be responsible for paying all fees and expenses of third party service providers who render services for your benefit. You will be consulted in connection with any third parties whose services we engage to assist in your representation. 6. DELINQUENCIES: If our monthly statements are not paid timely after they are rendered, we reserve the right to discontinue services until our account is brought current. You agree that non-payment of statements shall entitle us to withdraw from your representation and you agree not to contest any such withdrawal and to execute such documents as will permit us to withdraw. 7. NO GUARANTEES: Either at the commencement or during the course of our representation, we may express opinions or beliefs concerning the litigation or various courses of action and the results that might be anticipated. Any such statement made by any attorney or employee of our Firm is intended to be an expression of opinion only, based on information available to us at that time, and should not be construed as a promise or guarantee. We have made no warranties or guarantees about an outcome or result. The only thing predictable about a lawsuit is its unpredictability. Success in a lawsuit means different things to different people and is a highly subjective concept. Lawsuits are not subject to quantitative or mathematical formulae. The outcome of a lawsuit depends on a host of variable facts which differ from case to case and individual to individual. Predicting the outcomes of lawsuits and the possibility of monetary recoveries with accuracy is impossible. But be forewarned that lawsuits can be expensive, time- consuming and disruptive to your life. The process of "civil discovery" will lead to you being deposed and having to produce a large amount of records. While your attorney can and will assist you in this regard, you will be spending much time assisting in the preparation of the case since it is your lawsuit in which you have a personal stake. Accordingly, please do not entertain any unrealistic expectations of obtaining a specific result. Our objective will be to help you achieve in every ethical and legal way we can the best result that a strong effort, the law and the facts will permit. S. SCOPE OF DUTIES OF FIRM AND CLIENT: We will provide the legal services generally described in the engagement letter that accompanies this attachment. You will provide us with such cooperation 5 SHUTTS.COM I FORT LAUDERDALE I MIAMI I ORLANDO I SARASOTA 1 TALLAHASSEE I TAMPA I WEST PALM BEACH and truthful and accurate factual information and materials as we require to perform legal services on your behalf. Failure of the Client to disclose material facts to us truthfully and accurately and/or to cooperate with us or otherwise fulfill the terms of our engagement may lead to our decision to withdraw from the representation and it is understood and agreed that Client will not oppose such a decision if it is made. It is also understood that you are not relying on us for business, investment, financial, or accounting advice or to investigate the character or credit of persons with whom you may be dealing, unless otherwise requested and agreed to by the Firm. We will keep you advised of developments as necessary to perform our services and will consult with you as necessary to ensure the timely, effective and efficient completion of our work. Client is encouraged to request at any time information pertaining to the subject of the representation. 9. TERMINATION OF SERVICE: Upon completion of the matter to which this representation applies, or upon earlier termination of our relationship, the attorney-client relationship will end unless Client and the Finn have expressly agreed to a continuation with respect to other matters. We hope, of course, that such a continuation will be the case. The representation is terminable at will by either party subject to ethical restraints and the payment of all fees and costs. In the event that a court of competent jurisdiction refuses to permit Shutts & Bowen to withdraw upon termination, the Client remains responsible for fees and costs. 10. RETURN OF CLIENT RECORDS: During the course of our representation of you, you may be asked to provide to us various documents. We will hold these records for you during the pendency of our representation and for six months thereafter. We will retain the balance of your file for seven (7) years. It is your responsibility, however, to secure the return of your records. 11. INSURANCE: Our engagement does not include responsibility for review of your insurance policies to determine the possibility of coverage for the claim asserted in this matter or for notification of your insurance carriers about the matter or advice to you about your disclosure obligations concerning the matter under any applicable law (for example, the securities laws). 12. USE OF ELECTRONIC COMMUNI- CATIONS: Client acknowledges that Shutts & Bowen LLP and Client may, during the course of this engagement, exchange information, convey documentation and otherwise communicate electronically with one another and, from time to time, with third parties in furtherance of the purposes of the engagement. For purposes of this provision, electronic communications include, but are not limited to, internet e-mail, instant messaging, facsimile, and wireless communications. Client further acknowledges that neither party has control over the performance, reliability, availability or security of such electronic communications. Consequently, Shutts & Bowen will not be liable to Client for any loss, damage, expense, harm or inconvenience resulting from the loss, delay, disclosure, interception, corruption or alteration of any electronic communication. In the event Client objects to the use by Shutts & Bowen of any form of electronic communication, it shall so advise Shutts & Bowen in writing. 13. CHARGING LIEN/RETAINING LIEN: The Client agrees that the Firm shall have a lien on all of the Client's documents and personal property and money in its possession or another's possession for the benefit of the Client, including any funds held in a trust or retainer account of the Client which is maintained at or through the Firm, in order to secure the payment of all sums owed by the Client to the Firm under this agreement. The Client also agrees that the lien extends to property or funds received or receivable by the Client by settlement, judgment, or otherwise, or which was an issue in litigation between the parties. 14. CHOICE OF FORUM/CHOICE OF LAW: In consideration of the Firm's agreement to represent the Client, the Client agrees that the validity and effect of this Agreement shall be governed by and construed and enforced exclusively in accordance with the laws of the State of Florida, without regard to principles of conflicts of laws, and agrees to submit to the personal jurisdiction of Florida courts in connection with the contractual relationship embodied in these Terms of Engagement. The Client and Firm ("Parties") hereby submit to the exclusive jurisdiction of any federal or state court sitting in Seminole County, Florida for the purpose of any action arising out of or relating to this agreement (an "Action"), and agree that all such actions shall be heard and determined in such Florida federal or state court. Each of the Parties hereby irrevocably waives, to the fullest extent it may effectively do so, the defense of an inconvenient forum to the maintenance of any Action in Seminole County, Florida. b SHUTTS.COM i FORT LAUDERDALE 1 MIAMI i ORLANDO i SARASOTA i TALLAHASSEE f TAMPA ; WEST PALM BEACH 15. NO THIRD PARTY BENEFIT. Nothing herein is intended to create any benefit for a third party. The attorney-client relationship which is the subject of this document and the accompanying cover letter would, if created, exist only between the Finn and the undersigned Client(s) unless expressly specified otherwise. A third person or entity who is not named herein as the "Client(s)" has no legal right to claim that this Finn owes it (them) any duty or obligation as a result of the execution of this document. The Firm's only duty of representation is to the Client(s) named herein and that duty arises only when the attorney-client relationship is established in conformity with the ten -ns of this document. The Client(s) named herein understands that (he(she)(it) should not say or do anything which might lead a third party to believe that this Firm is representing the interests of that third party. Whatever legal advice is given to the Clients) by this Firm is intended only for the benefit and use of the Client(s). 16. CLIENT'S ADVANCE CONSENT TO CONSULTATION WITH FIRM'S IN-HOUSE COUNSEL OR OUTSIDE COUNSEL. In connection with our representation of the Client, the occasion might arise for us to consult with our General Counsel or other finn lawyers working with our General Counsel who do not perform work for the Client on the subject matter of the representation or with our own outside counsel at our expense, of course. To the extent that we are addressing our own rights or responsibilities, a conflict of interest might be deemed to exist between us and the Client as to such consultation or resulting communications, particularly if a dispute were to arise between us and the Client. A condition of this engagement is that, in such circumstances, the Client hereby consents to such consultation occurring, and waives any claim of conflict of interest based on such consultation or resulting communications that could otherwise disqualify us from continuing to represent the Client or from acting in our own behalf, even if doing so might be deemed adverse to the interests of the Client. The Client acknowledges that such communications are protected by our own attorney- client privilege from disclosure to the Client. Client agrees that such discussions and documents about legal and/or ethical issues affecting the firm's obligations will remain privileged and confidential. Please rear! these Terms of Engagement carefully. Your agreement to this engagement constitutes your acceptance of the foregoing terms and conditions. If any term is unacceptable to you, please advise us now so that we can resolve any differences and proceed with a clear, complete and consistent understanding of our relationship. These Terms of Engagement and the attached cover letter contain the entire agreement between you and the Finn. There are no other agreements or understandings stated or implied. It is understood and agreed that any changes, modifications or alterations of these Terms of Engagement shall be in writing and executed by the Client and the Firm. If you have any questions, please call me. If you agree to our representation on the terms described herein, please sign below and return this document (cover letter and Terms of Engagement) to me in the enclosed, self- addressed envelope. By signing and returning a copy of this document (including the cover letter) to us, together with any requested Deposit, you authorize us to undertake your representation. 7 SHUTTS.COM 1 FORT LAUDERDALE i MIAMI I ORLANDO I SARASOTA i TALLAHASSEE I TAMPA I WEST PALM BEACH ACKNOWLEDGMENT I have read and understand the foregoing and I agree to and accept the terms and conditions set forth herein. AGREED AND ACCEPTED: CITY OF SANFORD, FLORIDA as Name: /Ir Its: Rav Lo �. Date: 8--(fk'z' ORLDOCS 20713229 2 City of Sanford, Florida 300 N. Park Avenue .,,Sanford, Florida 32771 566001328 Tax I.D. No. Telephone No. Facsimile No. Email: lurootw stenstrolll.com shutts.com I FORT LAUDERDALE I JACKSONVILLE I MIAMI I ORLANDO I SARASOTA I TALLAHASSEE I TAMPA I WEST PALM BEACH Sr.FoRb Z APP' E CITY OF r. SkNFRD • FLORIDA CITY COMMISSION MEMORANDUM 23.148.H AUGUST 28, 2023 AGENDA WS X RM X Item No. �rl To: Honorable Mayor and Members of the City Commission PREPARED BY: Lonnie N. Groot, Assistant City Attorney SUBMITTED BY: Norton N. Bonaparte, Jr., ICMA-CM, City Manager SUBJECT: Engagement of Legal Counsel; PFAS; 1,4 Dioxane STRATEGIC PRIORITIES: ❑ Unify Downtown & the Waterfront ❑ Promote the City's Distinct Culture ❑ Update Regulatory Framework ❑ Redevelop and Revitalize Disadvantaged Communities SYNOPSIS: Approve a plan of action relating to engaging legal counsel relating to the PFAS and 1,4 Dioxane contamination issues is being submitted for the City Commission's approval. FISCAL/STAFFING STATEMENT: The City investment in engaging legal counsel relative to the PFAS issue is anticipated to be $10,000 while the proposals anticipated to be received relative to the 1,4 dioxane matter would be on the basis of a contingency fee with no direct City costs. BACKGROUND: A. Technical Matters Introduction: (1). 1,4 dioxane: The background provided will not explain the 1,4 dioxane issue in depth as the City Commission has been briefed as to that matter in great detail and has been reviewing the articles published by The Orlando Sentinel relative to the matter and impacts on the water supplies of Seminole County water utilities. A link to the series of articles follows: https://www.orlandosentinel.com/tag/toxic-secret/ (2). PFAS: With regard to the PFAS issue; Per- and polyfluoroalkyl substances (PFAS) are chemicals that resist grease, oil, water, and heat. They were first used in the 1940's and are now in thousands of various everyday products. For example, PFAS are used in paints, in products which keep food from sticking to packaging or cookware, in clothes and carpets to make them resistant to stains and in firefighting foam to make it work more effectively. PFAS have been given the common name of "forever chemicals". PFAS molecules have a chain of linked carbon and fluorine atoms. Because the carbon -fluorine bond is one of the strongest, these chemicals do not degrade easily in the environment. The United States Environmental Protection Agency (EPA) has published a great deal of information on PFAS at the following web site: https://www.epa.gov/pfas/pfas-explained as has the National Institute of Environmental Health Sciences at the following web site: https://www.niehs.nih.gov/health/topics/agents/pfc/index.cfm If additional educational sources are desired, they can be readily provided. B. PFAS Litigation: Numerous lawsuits have been filed against the largest chemical manufacturers in the world, as well as a number of other industrial and manufacturing companies as a result of PFAS contamination. A large portion of these lawsuits deal with Aqueous Film Forming Foam ("AFFF"), which is used in fire suppression, fighting and training. As the City Commission may recall, it assigned the litigation rights for land and/or any water contamination at the Sanford Orlando International Airport to the Sanford Airport Authority ('*SAA"), who had Shutts & Bowen bring a lawsuit in 2018. The SAA has been fully funding this litigation. That lawsuit was removed to federal court and removed further to a multi -district litigation (MDL) in South Carolina, which removed all litigation in the federal court system involving AFFF based claims. The first trial out of some 4,000 lawsuits in the MDL over PFAS pollution caused by AFFF was set to start in June of 2023. This litigation involved a lawsuit brought by the City of Stuart associated with PFAS contamination of City of Stuart's wells due to fire fighter training activity by the City's Fire Department and use of AFFF. As a settlement of that litigation, 3M and Dupont have reached global settlements of a new filed class action lawsuit filed on behalf of all public water systems in the United States. Those two proposed settlements, totaling nearly 11.5-13.5 Billion, are pending before the Court for approval. As the SAA is not water service utility provider to the public and does not operate a public water system, it is not going to be able to make a claim to the settlement proceeds. Inasmuch as the City does, however, maintain a public water system and would qualify as part of this class action settlement, if it is approved by the Court, then the City will get formal notice of the settlement and, currently, would have 60 days to decide to accept or opt out of the settlement. Unfortunately, the argument is that the 60 -day window will not be enough time for all the well over 10,000 public water systems in the Nation to get the information necessary to make this decision. The City, which has a relatively large public water system, is being proactive on this matter and by moving quickly will be at the front of the line for modeling and decision making (not caught with facilities and engineers unable to assist due to competing public water systems trying to comply within the 60 day window). The City could anticipate the possibility of being paid well over a million dollars in the context of the settlement. Should the City decide to accept the settlement, it will be required to give a release of its claims against Dupont and 3M, however, the settlement agreement's terms currently expressly disclaim the SAA's claims in litigation from the release if the City accepts the proposed settlement. The efforts of Mr. Renton will be invaluable in the City perfecting its claims and, Mr. Renton will provide a memorandum explaining the settlement terms and seeking the information from the City staff necessary to get to support any payout the City based upon a formula that is complex and will vary due to the number of other public water systems that submit claims and as to how impacted each is as a result of PFAS contamination in their respective systems. Mr. Renton will further address and answer any questions the City may have concerning the settlement and litigation. Although there can be no cap of the amount of the fees, the City controls how much, and the level of, information required by legal counsel during the course of the proceedings and, more importantly, controls the provision and detail/volume of data provided with regard to the City's water system. As Shutts & Bowen is a diverse law firm, they are asking for a waiver of a dispute concerning a charge for emergency response services incurred by the City of Sanford against Allstate Insurance Company, or one of its subsidiaries and as to any conflicts of interest that would preclude the firm from represent clients in planning, zoning, licensing, land use, contractual and related matters adverse to the City as long as such matters do not relate to the PFAS settlement claim. Examples of matters involving the Client that would be subject to the waiver include, but are not limited to, land use and zoning matters, procurement matters, public-private and other transactions (other than transactions relating to the scope of Services under this agreement), assisting clients in quasi- judicial proceedings involving the Client, Eminent Domain and affordable housing matters. These types of waivers are not unusual for municipalities to enter and the City Attorney does not see these waivers as an impediment to the retention of Mr. Renton. C. 1,4 dioxane Litigation: This agenda memorandum will not go into the detail already explored with the City Commission as to the costs incurred by the City over the years addressing the threat of 1,4 dioxane contamination relative to the City's wells and water utility facilities. The City Commission is aware of the actions taken by the City and the potentially responsible parties (PRPs) because of the efforts of special legal counsel Jake Varn and the media focus of late on the matter by The Orlando Sentinel. As a summary for background purposes, 1,4 -dioxane is a synthetic industrial chemical that is completely miscible (mixes in all proportions) in water. Generally, 1,4 -dioxane is a likely contaminant at many sites contaminated with certain chlorinated solvents (particularly 1,1,1 -trichloroethane) because of its widespread use as a stabilizer for those chemicals. The EPA indicates that 1,4 -dioxane is used in "paint strippers, dyes, greases, varnishes and waxes" and is also found as an impurity in anti -freeze and aircraft deicing fluid, and in consumer products like shampoos, deodorants, cleaning detergents and cosmetics. The use of 1,4 dioxane by the PRPs is well documented and the potential health hazards have been well articulated in the recent articles published by The Orlando Sentinel. The City could, potentially, engage in claims against the PRPs. As an example of the type of litigation anticipated, the State of New Jersey has sued Dow Chemical and other companies, of which several are unnamed, alleging that the companies have significantly contaminated the State and its drinking water with the 1,4 -dioxane. The lawsuit claims that the firms sold the suspected human carcinogen knowing that it would "significantly pollute drinking water supplies, render drinking water unusable and unsafe, threaten the public health and welfare, and harm other natural resources." And, it has recently been reported that several Long Island water districts seeking to recover damages arising from alleged contamination of drinking water supplies by 1,4 -dioxane and the one the primary defendants and the U.S. government agreed to settlement in 2 cases with the Bethpage case settling in the amount of $49 million and South Farmingdale case settling in the amount of $15.5 million. The Bethpage lawsuit, sought damages "to ... restore its damaged drinking water supply wells..." and reimbursement "for the costs of designing, constructing, installing, operating, and maintaining the treatment facilities and equipment required to remove the 1,4 -dioxane from its drinking water wells..." As to damages, Bethpage stated that it had incurred approximately $37 million that related to "exploration, construction, and related infrastructure spending for its replacement supply wells and capital costs." Bethpage forecasted that it would require an additional $25 million in operations and maintenance costs associated with the 1,4 -dioxane treatment at some of its plants. South Farmingdale stated that it had incurred or will incur at least $30 to $35 million in capital and operations and maintenance costs for treatment of 1,4 -dioxane at some of its wells, depending on various operational factors. South Farmingdale estimates that the resolution of its claim against the U.S. would cover "the majority of the capital costs and a material percentage of the initial operations and maintenance costs associated with installing necessary treatment technology." The City could, similarly, pursue any and all similar claims under a contingency fee agreement with a selected provider of legal services, or otherwise. Although the procurement of legal services are exempt from competitive procurement requirements, the use of a request for proposals (RFP) or request for qualification process would provide the ability of the City to competitively evaluate firms that submit proposals/qualifications while also learning a great deal about the potential pathways to attaining recovery from the PRPs. The issue as to whether the filing of a lawsuit is prudent at this time, however, requires further evaluation. Mr. Vam would like to evaluate timing issues and the status of actions by the Florida Department of Environmental Protection prior to making a decision about initiating litigation that could require costly expert testimony. His points are well taken. And, there appears to be potential in joining forces with the County in any efforts that the County may initiate as to the 1,4 dioxane matter involving County water facilities, etc. If it is possible to collaborate with the County, that could result in an array of possible benefits to both the City and the County. A County consultant has already reached out to the City to obtain information about City facilities and the City has sought information from the County in the past about County water issues. The assessment of damages is, of course, critical in the pursuit of any lawsuit claiming damages. As a matter of full disclosure, this City Commission agenda memorandum was provided to both Mr. Renton and Mr. Varn and their comments and suggestions were solicited. In addition, please not that in the years 2000-2001, the Assistant City Attorney, Lonnie N. Groot, was engage as a contract partner with the Shutts & Bowen law firm. LEGAL REVIEW: The Assistant City Attorney has prepared this agenda memorandum. RECOMMENDATION: City staff recommends that the City Commission: (1). Approve the limited engagement of Shutts & Bowen, as set forth in this agenda memorandum with regard to the PFAS contamination issue, and authorize the execution of the waiver and engagement letter of Shutts & Bowen. (2). Consider taking action with regard to the pursuit of 1,4 dioxane claims after further evaluation as to the timing of any lawsuit being filed, the assessment of damages and potential collaboration with the County. SUGGESTED MOTION: "I move to approve the actions, as proposed." Attachments: (1). Shutts & Bowen Conflict Waiver: Allstate Insurance Company. (2). Shutts & Bowen Engagement Letter for Legal Services.