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Municipal & Public Entity Litigation
CPM has a long history of representing public entities as outside counsel. CPM is often engaged to handle complex litigation that requires a law firm with the legal skills, dedication and resolve to litigate cases that often demand significant time and resource commitment, plus a thorough understanding of the intricacies of representing public entities. CPM has a proven record of successfully prosecuting and defending cases on behalf of large and small public entities throughout the State of California, including the City and County of San Francisco, City of Los Angeles, the County of Los Angeles, Los Angeles World Airports, San Diego County, Sacramento County, County of Monterey, East Bay Municipal Utility District, Sacramento Municipal Utility District and the Santa Clara Valley Transportation Authority.
RECENT CASES OF NOTE
LIBOR-Based Financial Instruments Antitrust Litigation
USDC Southern District of New York
CPM represents more than a dozen public entities including the UC Regents, San Diego Association of Government, the County of Sacramento the Counties of San Mateo and San Diego, the Cities of Richmond and Riverside, East Bay Municipal Utility District, and others who invested in financial instruments with interest rates that were set to the London Interbank Offered Rate, or LIBOR. LIBOR is the world's benchmark rate used for setting interest rates on a wide range of financial instruments from car and home loans to municipal derivatives. LIBOR is set daily based on the borrowing costs reported by members of the British Bankers' Association. The complaints allege that the member banks conspired to suppress LIBOR, both to reduce the amounts they were required to pay on LIBOR-based transactions, and to increase their perceived credit strength in the market. Plaintiffs invested significant sums in LIBOR-based financial instruments such as interest rate swaps and corporate securities, the rates of return of which were tied to LIBOR, and earned less on those investments as a result of the alleged suppression of LIBOR.
In re: Municipal Derivatives Antitrust Litigation
USDC, Southern District of New York
CPM represents dozens of public entities in ongoing complex litigation alleging a conspiracy to manipulate the bidding process for municipal investments of bond funds by financial institutions, insurance companies and brokers in the multi-billion dollar derivatives market. Bank of America obtained amnesty for violations of US antitrust laws by admitting its involvement in the conspiracy. Several executives from major financial institutions and brokers including JPMorgan, UBS and GE Capital have been convicted or pled guilty to criminal charges for their involvement in the bid-rigging conspiracy. By bringing individual actions, CPM is able to maximize gains on behalf of its public entity clients.
Municipal Bond Insurance Litigation
San Francisco County Superior Court
CPM represents public entities and non-profit organizations in California alleging that bond insurance companies and the credit rating agencies colluded to suppress their credit ratings forcing them to buy bond insurance before they issued bonds at a cost of millions of dollars. Defendants include Standard & Poor’s, Moody's and Fitch. Major bond insurance company defendants including Ambac and MBIA also misrepresented the extent of their exposure to subprime mortgage securitizations, which negatively impacted their ability to maintain their highest AAA-rated insurance, and the credit rating agencies misrepresented the insurers' AAA ratings knowing they were increasingly insuring toxic subprimes. These individual actions are coordinated in San Francisco County Superior Court before the Honorable Richard A. Kramer.
The People of the State of California v. Atlantic Richfield Co., et al.
Santa Clara County Superior Court
CPM represented the People of the State of California alongside ten California Cities and Counties in a public nuisance action in the Complex Department of Santa Clara County Superior Court. The six defendants included the largest historical manufacturers of lead-based paint and lead pigments in the country. The case was initially filed in March of 2000, and was finally brought to trial in the summer of 2013. The Lead Paint Litigation is considered one of the largest representative public nuisance actions in the country ultimately resulting in a judgment for the People in the amount of $1.15 Billion.
Santa Clara Valley Transportation Authority
CPM represented the Santa Clara Valley Transportation Authority (“SCVTA”) in a contractual dispute relating to several lease transactions that SCVTA entered into with a number of major financial institutions concerning the sale and lease-back of rail cars. These banks sought to extract tens of millions of dollars in unwarranted penalties from SCVTA after the financial crisis resulted in the downgrading of credit ratings of the insurance companies that insured the transactions, at no fault of SCVTA. CPM was able to assist SCVTA resolve the contract dispute in a manner beneficial to SCVTA without resorting to litigation.
National Gas Anti-Trust Cases I, II, III, & IV
San Diego County Superior Court
City of Los Angeles v. Reliant, et al.
County of Santa Clara v. Sempra, et al.
City and County of San Francisco v. Sempra, et al.
County of Alameda v. Sempra, et al.
County of San Diego v. Sempra, et al.
City of San Diego v. Sempra, et al.
County of San Mateo v. Sempra, et al.
UC Regents v. Reliant, et al.
Association of Bay Area Government v. Sempra, et al.
Sacramento Municipal Utilities District v. Sempra, et al.
School Project for Utility Rate Reduction v. Sempra, et al.
Nurseymen’s Exchange, Inc., v. Sempra, et al.
Owens-Brockway Glass Containers, Inc. v. Sempra, et al.
TAMCO Steel, et al. v. Dynegy, et al.
Antitrust litigation on behalf of eleven public entities and others who filed individual actions statewide that were coordinated in San Diego County Superior Court with related class actions. The complaints alleged that non-core natural gas retailers manipulated the market by reporting false pricing to published price indices to fix prices in the natural gas market during the California energy crisis. The case was venued in San Diego Superior Court before Judge Ronald S. Prager. The last settlements were done in 2009 and overall settlements totaled approximately $124 Million.
City and County of San Francisco v. Cobra Solutions, Inc., et al.
San Francisco County Superior Court
CPM successfully represented the City and County of San Francisco (“CCSF”) in a contract dispute with one of its former outside contractors, Cobra Solutions, Inc. (“Cobra”). Cobra submitted bills to CCSF for work that was never performed by one of the subcontractors that the contractor was responsible for supervising. CCSF was forced to bring a lawsuit against Cobra when Cobra refused to allow CCSF to conduct an audit. Cobra responded by filing a $12 million counter-claim against CCSF. After a three week jury trial, the jury found Cobra liable to CCSF and rejected Cobra’s $12 million counter-claim in its entirety.