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VOL. 123 | NO. 198 | Thursday, October 9, 2008

Lee’s Legal Fees Suit Could Surface Again

By Bill Dries

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TOP OF THE AFTERNOON: Memphis City Council members Shea Flinn, left, and Jim Strickland talk before Tuesday’s council session. Both voted against the proposed payment of former MLGW President Joseph Lee’s utility bills.PHOTO BY BILL DRIES

It was one year ago this week that nine new members were elected to the Memphis City Council.

It was the largest turnover of seats on the 13-member body in its 40-year history.

This week, the council had its most serious difference of opinion to date over a controversy that began onthe watch of the previous council. And it was one of the previous council members that made the difference in the outcome.

On a 6-6 tie vote Tuesday, the council rejected paying $426,422 in legal bills for former Memphis Light, Gas and Water Division President Joseph Lee.

Council member Jack Sammons was absent. Sammons was appointed to the council last month to fill the seat vacated by Scott McCormick until a special council election is decided next month. Sammons returned to the council just nine months after leaving office.

The MLGW board endorsed the payment to Lee’s attorneys, which comes from utility funds. Any utility expense more than $25,000 must be approved by the council.

‘An injustice’

Lee ran up the legal bills starting with a 2006 federal grand jury investigation that led to his indictment on corruptioncharges. The fees also include legal advice Lee got during a council investigation of how he handled the overdue utility bills of former City Council member Edmund Ford Sr.

Those overdue utility bills were at the heart of the criminal charges that included Ford as a codefendant. Prosecutors dropped the charges earlier this year following Ford’s acquittal by a jury in another corruption case unrelated to the overdue utility bills.

The legal fee payment would have settled a civil lawsuit Lee filed against the city and utility following his resignation. The suit sought to recover the fees.

Council member Bill Boyd said Lee showed Ford “extreme preferential treatment.”

“Mr. Lee betrayed the public trust by knowingly allowing this to occur,” Boyd said. “He made a series of bad decisions.”

But other council members said it has been a city policy and that the city paid roughly the same rate to attorneys who conducted the council’s internal probe of Lee’s tenure.

Council chairman Myron Lowery was unsuccessful in a move to lower and cap the legal fees at $275,000. Lowery, who was a critic of the way Lee was appointed by Mayor Willie Herenton and Lee’s decisions as utility president, said Lee was due “reasonable” legal fees.

“Mr. Lee got a raw deal. He should have never been indicted for a criminal offense,” Lowery said. “I called for his resignation early. I called for it often.”

But Lowery said he also offered to testify as a character witness had Lee’s case gone to trial.

“The charges were dropped. He was done an injustice.”

Council member Jim Strickland, an attorney, spoke highly of Lee’s attorney, Robert Spence, but said Lee violated utility policies.

“Mr. Lee had a very good lawyer and obtained a fantastic result,” he said. “But the ratepayers should not bear the cost. Mr. Lee’s actions, which resulted in the indictment, were done so outside the scope of his authority as president and were therefore not related.”

MLGW President Jerry Collins said elected and appointed city officials can be “sued or indicted whether or not they did anything wrong. … And if a person is not guilty of a crime, we should back that person as they carry out their duties.”

Fine lines

The failed federal case was a personal issue for several council members.

Ford’s son, current City Council member Edmund Ford Jr., cited a legal opinion from the city attorney’s office holding that it was not a conflict of interest for him to vote on the matter. His father is not seeking legal fees. The younger Ford pointed to a vote by the previous council to pay Lee’s legal fees and the fees paid to Glankler Brown PLLC attorneys who conducted the council’s investigation of Lee.

“We need to put pride to the side on this,” Ford said. “We need to be fair regardless of what people may perceive of you. I know how to be fair.”

He attributed the criminal charges against his father and Lee to a “media free-for-all” and “frenzy.”

Council member Wanda Halbert, a former Memphis school board member, recently was called to testify before a grand jury investigating Memphis school construction contracts. The grand jury indicted former Shelby County Board of Commissioners member Bruce Thompson, who later pleaded guilty and is awaiting sentencing.

Halbert’s campaign got a $2,000 campaign contribution at Thompson’s instructions, said a witness in the case. Halbert told reporters she never got the money.

She was never charged.

“As one who was almost put in the same situation, I would certainly hope no one decides after the fact that you spent too much on helping me to save my life when someone does me wrong,” Halbert said.

Council member Joe Brown predicted Spence would reopen the lawsuit against the city seeking the legal fees.

The yes votes for the legal fee payment were by Ford, Halbert, Brown, Janis Fullilove, Harold Collins and Barbara Swearengen Ware. The no votes were from Boyd, Lowery, Strickland, Shea Flinn, Reid Hedgepeth and Bill Morrison.

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