The Clinton City Council adopted a resolution approving the hiring of two law firms to represent the city Tuesday night.

The resolution states that Hannafan and Hannafan, LTD, of Chicago, and Gosma, Tarbox and Associates, P.L.C., of Davenport, will be retained to prosecute a suit alleging legal malpractice.

After the meeting, Mayor Mark Vulich said he could not confirm specifics of the city’s claim until it is filed later this week. As a governmental body, the city is required to adopt resolutions giving approval before actions take place, Vulich said, even if details cannot be released before the suit is officially filed. He also said he could not confirm the cost of retaining the law firms until further details of the suit are made public.

Former mayoral candidate Ed O’Neill, however, had no qualms about sharing what he believes he knows. Citing a source with inside knowledge of city hall, O’Neill accused the council of spending city funds on a “wild goose chase” to seek restitution from attorneys representing the city in a 2010 Emergency Medical Services  billing lawsuit, which resulted in the city’s decision to pay a $4.5 million settlement.

A team of attorneys, led by Michael Walker, were paid over $160,000 to represent the city’s interests from September 2009 until the conclusion of that settlement. A former Clinton firefighter, Timothy Schultheis, called EMS officials out on what he believed were improper billing procedures that resulted in greater Medicare reimbursement rates.  The city voted to pay the $4.5 million rather than face more significant fines.

Since the settlement was reached, the two city employees believed to be responsible were fired, then rehired after the Civil Service Commission found no evidence of wrongdoing. Council members have since questioned the decision to settle, and former Mayor Rodger Holm said he would petition federal legislators to assist in reducing the settlement amount.

Speaking at Tuesday’s meeting of the City Council, O’Neill claimed that Iowa open meetings laws have been violated in discussions surrounding the retainer of the law firms, and that the suit is little more than an attempt to keep closed session records collected in advance of the 2010 settlement decision out of public domain.

“At minimum, it’s going to cost $500,000 to retain this law firm, and you’re going to lose,” O’Neill said.

If the city is retaining the firms to seek damages for legal malpractice for advice received regarding the 2010 decision, O’Neill said that they had very little chance of winning. He believes that any parties targeted by the suit will probably counter-sue the city for defamation.

In a phone interview following the City Council meeting, O’Neill expanded on his accusations, including his belief that a motivating factor for the suit is the continued suppression of the closed session records.

Currently, the city faces a suit filed by the American Civil Liberties Union of Iowa, on behalf of local group Citizens for Open Government, demanding that the records be made available for public scrutiny. By getting involved in another lawsuit, the city will be able to argue that releasing those records could compromise legal strategy, according to O’Neill.

Spending money on what he believes will be an unsuccessful lawsuit is improper, O’Neill said, especially considering the city’s financial situation.

“We don’t have enough money to run a garbage collection,” O’Neill said. “We’re $600,000 in the hole trying to collect garbage...Where’s the money coming from to underwrite this lawsuit? That’s the question that should be being asked right now.”

Vulich said that he was unsure where O’Neill had received his information regarding the cost of retaining the law firms, but said it was inaccurate. He said that the city’s decision to not release details of the suit until it is filed is a result of legal advice.

When the suit is officially filed, which he believes will happen later today or Thursday, Vulich said a press release will reveal the city’s intentions and goals.  Finance Director Jessica Kinser confirmed that a $25,000 payment had been made to Hannafan and Hannafan, LTD on March 5. She said no payments have yet been made to Gosma, Tarbox and Associates, P.L.C.

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