Settled out of Court

The ACLU and Eureka City Schools settled. But who got what?



Last month, the National Center for Youth Law announced that it and the American Civil Liberties Union of Northern California had reached a settlement in the federal civil rights lawsuit they brought against Eureka City Schools on behalf of four local minority students who they said suffered pervasive and systemic discrimination in the district's schools.

What wasn't announced is that the settlement included a $700,000 payout, 85 percent of which went to paying the fees and reimbursement costs of ACLU and National Center lawyers. The plaintiffs in the case — four teenagers who each alleged years of racial taunting and discrimination in Eureka schools — each received $27,500, according to court documents and Eureka City Schools' response to a California Public Records Act request submitted by the Journal.

Filed in December 2013, the lawsuit alleged district administrators ignored complaints of racial taunting and bullying, disproportionately disciplined minority students, and that district staff made racially and sexually insensitive comments to students on numerous occasions. The specific allegations in the suit included things like male students regularly pinching and punching girl's breasts and buttocks on "titty-twisting Tuesdays" and "ass-slap Fridays" as staff looked the other way; a teacher telling students things like "black people get bored easily" and, "don't give me your black attitude;" a history teacher telling her students to "make up" different Native American tribes and pretend to fight each other to mimic the way tribes "traditionally resolved conflicts between their communities;" and an administrator refusing to help a student with a learning disability until her mother proved its existence.

The four plaintiffs alleged this school environment left them anxious, depressed and angry, in some cases leaving their educational needs unmet.

In filing the suit, attorneys said they were seeking both injunctive relief — essentially a court-ordered plan directing Eureka City Schools to address these issues and make the district a more welcoming place for all students — and a payout to their plaintiffs. When the settlement was announced by the National Center on Jan. 29, everyone involved seemed willing to talk about the "wide-ranging settlement," which included the district's agreement to enhance multi-cultural curriculum, provide students with disability-appropriate services, reduce race and disability disparities in discipline, and contract with an independent research group to do a district-wide assessment surrounding issues of racial and gender equity in student discipline. But when the subject turned to money, no one would comment.

"I'm not allowed to talk about that," said National Center for Youth Law senior attorney Michael Harris. "Both the defendants and the plaintiffs have agreed not to say anything about whether there were damages awarded as a part of the settlement."

Eureka City Schools Superintendent Fred Van Vleck similarly declined comment, but public documents offer clarity. The documents show that the settlement awards each of the four plaintiffs $27,500, with two of them getting up to another $2,000 in reimbursements for tutoring expenses. And the four plaintiffs lawyers are to be paid $600,000 — $137,133 in cost reimbursements, with the balance going to pay attorney fees.

None of that money will come directly out of Eureka City Schools' coffers, however. The district is a part of a joint powers authority that's under the umbrella of Northern California ReLiEF, which acts of as an insurance pool for hundreds of schools and districts. The setup allows schools to share liability and risk, but sacrifices local control.

Speaking generally and not about any specific case, Van Vleck said when a lawsuit is filed against the district, Northern California ReLiEF takes up the defense. Its attorneys then negotiate any potential settlement and defense, with little — if any — input from the district. "It becomes a business decision for the insurance carriers," Van Vleck said, adding that an ultimate jury award of $1 to one plaintiff can leave a defendant responsible for exorbitant attorney fees.

While settlements and awards of damages don't come out of Northern California ReLiEF's members' budgets, they can affect premiums and deductibles, just as an auto insurance claim would, Van Vleck said.

When looking at the $600,000 attorneys received in this case compared to the much smaller sums taken home by the plaintiffs, it might be easy to think the case was little more than a fundraiser for the ACLU and the National Center. But University of California Hastings College of Law professor David Levine cautioned against jumping to that conclusion.

For one, Levine said governing rules dictate that attorneys can only charge going market rates in case settlements. And, he said, it's important to remember that these kinds of cases are generally taken with the understanding that if they succeed the defendant will pay attorney fees, and if they don't the plaintiffs' attorneys walk away with nothing. But Levine said the real question at hand in judging whether attorney fees are excessive is how much work went into the case.

"How much litigation took place before they got that settlement?" he asked. "Do you have a case file that's a couple of feet thick, or one that's one sheet of paper?"

Court documents indicate lawyers with the ACLU, the National Center and a firm offering pro-bono services counseled all four defendants and their guardians on the case regularly, deposed more than 20 witnesses, submitted written requests for documents and ultimately reviewed and exchanged thousands of pages of documents. And that's all after the case was filed. Levine said plaintiffs' attorneys have to pour a lot of hours into a case before filing — "due diligence to make sure a case is well grounded in fact and law."

Based on the brief accounting provided in a sworn declaration by Harris, it seems Eureka City Schools and Northern California ReLiEF may have received a steep discount. Harris states in the document that plaintiffs' counsel, valued at current market rates, put more than $3 million into the case but substantially discounted its fees during negotiations to achieve a quick settlement that was in the best interest of its clients. Together, the ACLU and National Center discounted their rates by 20 percent for senior attorneys and 40 percent for junior attorneys, which still left a $1.8 million bill for fees and costs. The ultimate settlement amount, Harris states, "constitutes a two-thirds reduction to the already-substantially discounted fees and costs."

The damages awarded the plaintiffs in the case will mostly be put in trust funds that the court will oversee until the students turn 18 (25, in one case). The court approved several exceptions to that, including releasing $4,500 from one plaintiff's account to allow his family to buy a used car. Currently the family is carless, and the teen doesn't feel safe taking the bus. The family pledged to transfer the vehicle's title to the teen on his 16th birthday. Another exception approved using some of the trust funds to purchase clothes for a teen who regularly speaks at United Indian Health Services and Yurok Tribe events on suicide prevention. The other exception was to release $2,400 to one guardian to pay for a year's worth of twice-monthly therapy sessions with a counselor specializing in treating adolescents who have suffered trauma.

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