Like all political subdivisions in Louisiana, the City may sue and be sued in its official capacity for a variety of causes. The following narrative summarizes the major litigation affecting the City at this time:
New Orleans Firefighters Local No. 632, et al v. The City of New Orleans, et al.: This original suit, filed on July 14, 1981 as a class action by the New Orleans Firefighters Union and individual employees of the New Orleans Fire Department (“NOFD”), asserted a claim that the City’s implementation of the New Orleans Civil Service Commission’s annual leave policy, which limited the amount of unused annual leave that could be accrued and carried over into subsequent years, was an unconstitutional “taking of property” in violation of Article 1, Sections 2 and 4 of the 1974 Louisiana Constitution. Plaintiffs sought back pay and “all other damages” arising from the alleged unconstitutional “taking” of excess unused annual leave days and injunctive relief enjoining the City from denying the plaintiffs the use of accrued annual leave beyond the City-imposed limit (then 90 days).
The plaintiffs amended their petition on April 24, 1985, adding the Director of Personnel and the Civil Service Commission as defendants and asserting a second cause of action by claiming that the limitation on accumulation of unused leave by the City and the Civil Service Commission also violated La. Rev. Stat. 33:1996. Specifically, plaintiffs alleged that the City’s cap on accrued annual leave resulted in a prohibited “forfeiture” of the vacation benefits provided by the statute.
On March 2, 1993, some twelve years after the original suit was filed, the plaintiffs filed a second amended petition to add two new causes of action alleged to be “materially related” to the original claim; specifically, that (1) the City policy establishing a lesser accrual rate for annual leave privileges and the forfeiture of accumulated annual leave benefits violated La. R.S. 33:1996 by providing less “vacation and annual leave privileges” than that mandated by the statute, and (2) the City’s Civil Service Commission Rules, which provided for a different schedule of longevity pay increases than that mandated by La. R.S. 33:1992(B), violated that statute. See CSC Rule IV (8).
This case has been litigated for over 20 years. There are a number of issues remaining, all concerning the amount of damages that are owed. The issues concern how much annual leave is owed to active and retired members, how much in longevity is owed on millage
National Union Fire Insurance Company of Pittsburgh, PA, Et AL. versus the City of New Orleans, USDC # 09-6598.
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collected and paid to the firefighters, how much in back pay is owed to active and retired firefighters and how much in DROP and PLOP benefits are owed to retirees. The City is in earnest settlement negotiations presently to try and resolve this matter with liability approximated between $56 million to $150 million.
John Johnson, et al v. Orleans Parish School Board, et al Civil District Court No: 1993-1433, C/W 1994-5446, C/W 1994-12996, C/W 1995-13271: Residents of houses built on Agriculture Street landfill brought class action against the City, its housing authority (HANO), school board (Orleans Parish School Board), and liability insurers to recover for negligence in converting municipal landfill into residential area. The class included current and former business owners and employees and students and employees of elementary schools estimated at over 7,000 claimants.
The City was in litigation with the United States with respect to certain clean-up costs associated with the Agriculture Street Landfill. Following Hurricane Katrina, the United States dropped their demand for monetary damages, and settlement negotiations resulted in operational commitments only. A consent decree was entered into on September 9, 2009 on terms that require no financial obligations of the City.
The first trial of nine (9) plaintiffs involving the Agriculture Street Landfill occurred in 2005. The court held the City 50% liable and in solido and in virile share with the HANO and HANO’s former insurers: National Union Fire Insurance Company of Pittsburg, PA, Republic Insurance Company, Louisiana Insurance Guaranty Association as successor in interest to Southern American Insurance Company, and United States Fire Insurance Company. The 4 Circuit Courtth
of Appeals affirmed the percentage of fault, but reduced all emotional distress awards and ranges by one-half. On April 8, 2010 the co-defendants obtained a judgment in the amount of $529,935.41 plus interestsagainst the City for its virile share of the January 12, 2006 class-action Judgment .1
This judgment has been placed on the City’s Unpaid Settlement Judgment List.
In 2011 the trial court scheduled trials for the next 76 plaintiffs. The 76 Plaintiffs First Flight trials were continued without date pending pre-trial motions, writs and appeals to the Fourth Circuit and Supreme Court. Recently, in 2012 the Supreme Court remanded the insurance coverage issues back to trial court.
In 2011 plaintiffs made a demand on the defendants for approximately $96,000,000.00, not including judicial interest. It is estimated that the financial impact to the City of New Orleans could range from $38,000,000.00 upwards plus interest.
Doretha Walker, et al. v. Amid/Metro, et al., CDC No. 07-14795 Div. H, Class Action: This matter relates to the taking of private citizens’ land over the course of several decades to operate the Gentilly Landfill. On March 21-22, 2011, a hearing on plaintiffs’ Motion for Class Certification and Appointment of Class Representatives and Counsel (“Motion”) was held in the above-referenced matter. On August 24, 2011, Judge Bagneris granted plaintiffs’ Motion. Since that time, defendants have appealed the Court’s certification of the class, and said appeal is still pending in the 4 Circuit. The City’s liability varies greatly depending on whether the 4 Circuit upholds theth th
class and the scope of said class. Regardless, the potential exposure to the City could range between $2,326,281.90 and $11,419,979.60.
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Bartholomew/Holmes/Madison, USDC 2006-5695: These consolidated cases involve the three cases brought by the above families seeking compensation for the deaths and injuries that occurred on the Danziger Bridge in the aftermath of Hurricane Katrina. The Madison family seeks to recover for the alleged wrongful death of Ronald Madison. The Holmes/Bartholomew families seek to recover for the injuries allegedly sustained as a result of gunshot wounds. Potential liability is difficult to predict, but could be upwards of $10 million or above.
Succession of Henry Glover, et. al. v. City of New Orleans, et. al, USDC 2010-1719: These three cases (which have yet to be consolidated, but likely will be) arise out of the death of Mr. Glover in Algiers after Hurricane Katrina. Potential liability could exceed $50,000,000.
FOP v. CNO CDC 80-7924: Class-Action lawsuit by police officers for millage payments that alleged to have been paid to them rather than the millage going into the general fund, for the years 1980-2003. There is a prior judgment for $3,376,740.00 for failure to pay a portion of the 1928 millage dedicated to a supplemental pay for police officers from 1979 to 1994, which has been placed on the City’s Unpaid Settlement/Judgment List. Currently, litigation is pending for other years and is in discovery mode. Potential liability could exceed $5 million.
The litigation information relating to the City is provided for general information purposes. The above litigation does not affect the security for the Bonds.