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This post shows the Federal Government’s strict policy against confidentiality clauses in settlement agreements.  They get it.  They understand that the government is the people and we, the people, have a fundamental right to know what agreements are made on our behalf.  The New Hampshire constitution reiterates that principle in article 8.

[Art.] 8. [Accountability of Magistrates and Officers; Public’s Right to Know.] All power residing originally in, and being derived from, the people, all the magistrates and officers of government are their substitutes and agents, and at all times accountable to them. Government, therefore, should be open, accessible, accountable and responsive. To that end, the public’s right of access to governmental proceedings and records shall not be unreasonably restricted.

Followers of this blog know that this gets to the very heart of the matter – lack of open government.  There is hardly a Selectman’s meeting that goes by that doesn’t have a non-public session.  Now we have entered a new phase where the Selectmen make multimillion dollar settlements and agree to keep the details from the public.

There are two possible reasons why the Wright Pierce settlement has a confidentiality clause:

1. The Selectmen asked for it because they don’t want to be accountable to the public.
2. Another party to the settlement insisted on it.
3. (Number 2 provides convenient cover for number 1.)

Number one just says that the Selectmen put themselves above the public.  While arrogant, it’s definitely the least offensive of the two possibilities and truth-be-told would be no big surprise.

The second possibility,  definitely the most egregious, is that the Selectmen sold our constitutional right to know.  That is the selectmen may have agreed to forfeit our right to know what happened in return for this cash settlement.  They didn’t forfeit any of their rights, but my rights and your rights, no problem.  There are a lot of things that the Selectmen can legitimately negotiate, but let me be as clear as I can about this.

The Selectmen do not have the authority to agree to forfeit my right to know in return for money.

An underlying principle of Right-to-Know is that it doesn’t matter why the public wants to know.  It is a basic right and part of the foundation of open and free government.  The burden is on the Town to prove disclosure will result in harm.  Simply claiming “confidential” is insufficient.  After 4 years and $1.4 million, the town’s case had some settlement value.  The Selectmen had no authority to sell the public’s right to know in order to increase that value.

The NH Supreme court has used the Federal Freedom of Information Act as a basis for interpreting the NH Right to Know law.  As you can see, the federal policy toward non-disclosure clauses in government settlement agreements is pretty unequivocal.

The Feds get it, the State gets it, how about you?  You may feel that it’s OK if they sold out your rights, but the real question is whether you think it’s OK if they sold out my rights.  It’s a slippery slope folks.

As a result of settlement, the parties filed a Stipulation of dismissal with prejudice and the court subsequently responded with this Judgement.  The final docket indicates that the case is now closed.

The blog will pursue the details of the settlement agreement.  As it stands, the issue of whether the site can be fixed was suppressed from the trial on procedural grounds, not the merits of the proposal.  So it is important for us to understand what has been agreed to in the settlement.

Already, there is a suggestion that NHDES may want the town to pursue remediation.  The town’s letter to NHDES includes a 30 month study of alternatives.  That’s 2½ years folks. It almost seems like the town now wants NHDES to order us look into fixing the facility.  Hmm.

§50.23   Policy against entering into final settlement agreements or consent decree that are subject to confidentiality provisions and against seeking or concurring in the sealing of such documents.

(a) It is the policy of the Department of Justice that, in any civil matter in which the Department is representing the interests of the United States or its agencies, it will not enter into final settlement agreements or consent decrees that are subject to confidentiality provisions, nor will it seek or concur in the sealing of such documents. This policy flows from the principle of openness in government and is consistent with the Department’s policies regarding openness in judicial proceedings (see 28 CFR 50.9) and the Freedom of Information Act (see Memorandum for Heads of Departments and Agencies from the Attorney General Re: The Freedom of Information Act (Oct. 4, 1993)).

(b) There may be rare circumstances that warrant an exception to this general rule. In determining whether an exception is appropriate, any such circumstances must be considered in the context of the public’s strong interest in knowing about the conduct of its Government and expenditure of its resources. The existence of such circumstances must be documented as part of the approval process, and any confidentiality provision must be drawn as narrowly as possible. Non-delegable approval authority to determine that an exception justifies use of a confidentiality provision in, or seeking or concurring in the sealing of, a final settlement or consent decree resides with the relevant Assistant Attorney General or United States Attorney, unless authority to approve the settlement itself lies with a more senior Department official, in which case the more senior official will have such approval authority.

(c) Regardless of whether particular information is subject to a confidentiality provision or to seal, statutes and regulations may prohibit its disclosure from Department of Justice files. Thus, before releasing any information, Department attorneys should consult all appropriate statutes and regulations (e.g., 5 U.S.C. 552a (Privacy Act); 50 U.S.C. 403-3(c)(6) (concerning intelligence sources and methods), and Execution Order 12958 (concerning national security information). In particular, in matters involving individuals, the Privacy Act regulates disclosure of settlement agreements that have not been made part of the court record.

(d) The principles set forth in this section are intended to provide guidance to attorneys for the Government and are not intended to create or recognize any legally enforceable right in any person.

[Order No. 2270-99, 64 FR 59122, Nov. 2, 1999]

Someone posted a comment to yesterday’s post pointing out that WP’s answer to the Amended Complaint contained a counterclaim. The author did not identify him/herself and so, in keeping with the blog comment policy, the comment was not published with the post, but here is what it said.

I am no lawyer, but Wright-Pierce filed counterclaims against the Town. That would make the ‘lawsuit’ also “against the government unit”, no? I think Dave Owen has it wrong and you should try again to get the settlement agreement.

The counterclaim in WP’s response is:

WHEREFORE, Wright-Pierce respectfully requests that the Amended Verified Complaint be dismissed with prejudice and judgment entered in Wright-Pierce’s favor on the merits, and that it be awarded costs and attorneys’ fees, and that Wright-Pierce be granted such further relief as this Court may deem just and proper.

Now you may think this is just the boilerplate included in every response of this type, and that’s probably true.  Nevertheless, it is a claim against the town.  But more to the point, there is a distinct possibility that the settlement addresses this claim. Currently, the lawsuit is frozen with two motions pending:

1.  A motion by the town for treble damages and attorney fees.
2.  A motion by Wright-Pierce to dismiss for lack of subject matter jurisdiction.

The settlement was no doubt driven by the potential consequences of both motions.  Consider if the motion to dismiss had been granted.  WP had said in their answer to the amended complaint there was a lack of jurisdiction and that the case should be dismissed for improper venue.  So they would have been seeking fees and costs for defending an action that was filed in the wrong venue by Wolfeboro.  If the case is settled with such a motion still pending, lacking a judgement in Wolfeboro’s favor, it is possible that WP could request fees and costs.

We all know that is improbable, but it is possible, and as such, the settlement agreement may specifically addresses that claim.  In that event, not only would there be a legitimate argument that this is a settlement of a claim against the town, it would be supported by the settlement document itself.

I’ve filed another RTK request based on RSA 91-A:4,XI.  This may be quicker and easier than hiring a lawyer who specializes in RTK law.  In ant event, it will provide a more solid basis for a petition to the Superior Court should it come to that.

The blog has received anonymous unsolicited information in the past.  Sometimes the source and/or authenticity of the information or documents cannot be determined, so it can’t be used.  In this case, those issues don’t apply.  This comment has been a great help and thanks to the person who sent it in.

Today I received word from the Town Manager that a settlement agreement has been signed.

Bob:  In response to your previous Right-to-Know law request to see a copy of the signed settlement agreement between the Town and Wright-Pierce Engineers, I can inform you that all the parties have now signed the settlement agreement, and so the signed settlement agreement now actually exists.  However, I must decline to make a copy of the document available for your inspection for the following reasons;

·        The Settlement Agreement is “confidential” within the meaning of RSA 91-A:5, IV and therefore not subject to disclosure to the general public, and

·        RSA 91 A:4, XI provides that “every agreement to settle a lawsuit against a governmental unit, threatened lawsuit, or other claim, entered into by any political subdivision or its insurer, shall be dept on file at the municipal clerk’s office and made available for public inspection for a period of no less than 10 years from the date of settlement.”  The Wright-Pierce litigation was a lawsuit by, not against, a governmental unit.  Had the Legislature intended that agreement to settle a lawsuit by a governmental unit be made available for public inspection, it could simply have added the words “by or” before “against a governmental unit” in RSA 91A:4, XL.

Dave Owen

Sounds great!  So Wright Pierce (and their insurance company) paid us $7.5 million right?  I’m not so sure about that.  That is, I believe the town is going to get $7.5 million, I just doubt it’s all coming from Wright-Pierce.

I’m disappointed that the Selectmen would make such a high stakes agreement with a complete lack of transparency.  They have told us only what they want us to know.  It wouldn’t take a month to finalize the agreement as they have characterized it.  We don’t know who is paying us the money.  We don’t know what concessions the town has made in return for the money.  Most importantly, we don’t know how this agreement affects the town’s options regarding moving forward with solving our effluent disposal problem.  That’s not open government.

Of course the Selectmen will say that the agreement doesn’t affect our options.  Then again, if they think it does, they can’t tell us, and that’s just their interpretation anyway.  That’s why there is a Right-to-Know law.

After two days of avoiding the question, the town has finally responded to my specific RSA 91-A questions:

Bob: Good morning. To definitively answer your question of yesterday of whether the settlement agreement has been signed yet, the answer is no. Relative to your formal request to see the signed settlement agreement, a document that does not yet exist, the clock on the 5-day response period under the Right-t-Know law will begin when I receive a copy of the signed document, and you will be provided with the reasons for the Town’s declining to make it available to you in that timeframe. Dave Owen

So they are still searching for those last few I’s and T’s.

If you read further, you will see that the town does not intend to disclose the settlement document to the public.  That is, except the parts they want you to hear.

So think about it.  The Selectmen are negotiating a $7.5 million contract for the town, and in the end, they don’t want the taxpayers and voters to be able to see the terms of that agreement.

I’ve been asking for this agreement for a month now.  It’s possible that they are delaying the signing simply to retain their shield of secrecy and ability to conduct discussions in non-public session.  At the last BOS meeting, the Chairwoman implied that the due date for the payment would be retroactive to the date of  verbal agreement.

In any event, if and when they sign the agreement, and if they decline to make it available, it is relatively straightforward to ask the Superior Court to rule on it.

Since the end of August, we have been hearing about settlement activity with Wright-Pierce.  First the Selectmen announced that a deal was eminent.  Then two meetings ago on September 3, the Selectmen announced that a settlement had been reached and that it would be signed shortly.

A week later, I asked to see the agreement.  I was told it wasn’t signed yet.

At last week’s meeting on September 17, the chairwoman told us that it took awhile to “dot the i’s and cross the t’s” but the agreement would be signed on Friday (Sept 19).

Today I asked to see the agreement.  The town manager told me:

I have not seen and do not have a signed copy of the settlement agreement

I’m not sure what to make of this.

Is the agreement signed or isn’t it?  As I understand the Right-to-know laws, the fact that the town manager doesn’t have a copy isn’t a legitimate reason to deny the request.

Today the court scheduled a teleconference for Oct 2.  Seems to me that if the parties had settled, the court would have been notified.  It’s been more than a month since the parties met with the arbitrator.   The town is being pressured by NHDES to bring the town’s waste water system “into compliance”.

At the last Selectman’s meeting, the town reported that they had a good meeting with NHDES.  That may be a little sugar-coated.  Since the summer, NHDES has been asking the town for a meeting to talk about what the town is going to do about the violations at the site.

The town stonewalled until NHDES told the town that they might turn it over to EPA, explaining that the town might prefer to deal with NHDES.  The meeting was scheduled after that.

The result will be an Administrative Order on Consent, which is basically an administrative order that the town agrees to.  It will include specific actions that the town must take, and will be enforceable in court.

Time will tell, but I think NHDES is looking for something more than a drip-irrigation pilot program.  When they say “bring into compliance” it seems like they are interested in having the town fix the RIB site’s violations.  That’s pretty much what the NHDES said in court – they would like to work with the town to fix the RIB.

The town seems to have delayed these discussions with NHDES until they could reach a settlement with Wright-Pierce.  The prospect of continued litigation with a new Administrative Order would be difficult for the town.  Perhaps Wright-Pierce is rethinking their position.

How long does it take to dot I’s and cross T’s?

In the remake of The Graduate, to be filmed on location in Wolfeboro, the buzzword will be updated from “plastics” to “drip irrigation”.  OK, that’s two words. Tune in to any recent Selectmen’s meeting and listen to them talk about drip irrigation like it’s going to miraculously solve the town’s ten-year saga of sewage effluent disposal.

In an effort to jack-up Wright Pierce for tens of millions of dollars, the town swore to a judge and jury that our RIB system was completely failed and the land with all of the infrastructure has absolutely no value going forward. Now that all we got was enough to pay the lawyers and the loans, we are left with nothing going forward.

Enter drip irrigation to present the illusion that there is some miracle solution that has eluded us up until now.  The Selectmen are planning to spend $700,000 next year on a “pilot program” and have submitted a request to the state for $5.1 million in loans to build a larger system.

The request to the state is based on a December 2012 report produced by Underwood Engineers.  Back then, they had identified a bunch of town land that they thought could be used for drip irrigation.  They didn’t actually look at the land, mind you.  They just – identified it. You know, on a map.

The suggested capacity of the proposed drip system was 43 million gallons per year.  According to the report, combined with the existing spray fields, that would be about half of what the town currently needs.  The cost was estimated at $5.1 million.

They proposed an in-depth evaluation to include accurate mapping, test boring, and soil sampling to more accurately determine capacity.  The town ponied up the requested money.  On June 3 of this year we got the report.  Turns out most of the land is not that viable, and the estimate was downgraded from 43 million gallons per year to 16.

Well, at least the 16 million can be supported by test pits and soil samples right?  Er, not really.  It seems the money to do actual engineering ran out, so they just walked around for a couple of days and looked at the land.   Maybe they learned a lesson from Wright-Pierce.  Once you start doing that scientific stuff, you leave yourself wide open for an expert witness who’s never done it to say you didn’t do enough.

Not to be discouraged, two weeks later on June 20, the town filed a request for $5.1 million in loans to build the system anyway.  Moreover, there is an “urgent” CIP item this year to allocate $700,000 for a pilot program.

We haven’t identified any significant useable land.  We haven’t tested any soil.  We don’t even have a conceptual plan that suggests that a significant portion our effluent disposal needs can be met with this technology.

Next time you flush your toilet, don’t let these things get you down.  Just think “Drip Irrigation”.  It’s the future.

Those Wright-Pierce guys are looking smarter by the day.

At the trial, the town mocked a “windshield survey” that they had done prior to suggesting to the town that they investigate constructing a RIB system.  WPs guys defended themselves by telling us all about land based disposal.  They said that geologically speaking, there are few good options for disposing of effluent in Wolfeboro, and no cheap ones.

But looking at a topographical map of Wolfeboro, there was this glaring feature.  A glacially formed hill that a trained geologist knows is composed of sand.  Moreover, it was on a power-line right of way that connected the site to the town’s waste water treatment facility.  They said it looked like a gold mine.

Nevertheless, they did the work to estimate the life cycle cost of other alternatives, but couldn’t come up with anything that could compare with a RIB system on that sandy hill.

After the town filed the RIB lawsuit, they engaged Underwood Engineers to take a fresh look at alternatives.  The first cut was a “desktop study” (not to be confused with a “windshield survey”).  27 town owned sites were identified for a potential $5 million drip irrigation system.  The town gave them some money and almost a year to develop the idea.  We prepared a preliminary request with the state for $5.1 million in loans.

So this spring, they actually went out and looked at the land that they had identified in their “desktop study”.  Big surprise!  most of it was rocky, or saturated, or just inaccessible.  Long story short only 10 of the original 27 sites appeared feasible to an engineer just walking the land and looking at it.  Sort of a “windshield survey” without the windshield.

Now the new estimate is that spray irrigation on existing land might only be able to dispose of 16 to 32 million gallons per year.  To put that in perspective, the town produces about 121 Mgal/year, and the existing 49 acres of spray fields dispose of about 31 Mgal/year.

So the drip system might be able to handle 13%-26% of the town’s current needs.  That’s based on a guy walking around with a handheld gps and a notebook for two days.  Oh, and they say “Most of the potential areas are remote from existing pumping stations and would require long supply/return pipes to be installed”.

But hey, we’re going to get a bag of money from Wright-Pierce so what’s the big deal right?  Well, after the sewer fund is repaid for legal fees, the remainder just about covers what we owe on the RIB system.

Go back Jack and do it again…

Those Wright Pierce guys are looking smarter by the day.

Surely the settlement of $7.5 million with Wright-Pierce Engineers marks a milestone and a change of direction in the town’s sewer plight.  No doubt it unburdens Wright-Pierce as well, notwithstanding the huge financial impact it will have on them.  But before we celebrate victory, let’s take a minute to put this all in perspective.

As of the start of 2014, the Town’s annual report lists about $6 million in bonded debt related to the RIB system.  The motion for costs that was filed but subsequently stayed lists $1.4 million in lawsuit related costs.  So with this settlement we are back to square one.

I’m not talking about square one 2012 when we filed the lawsuit.  I’m talking about square one April 19, 2005 – nearly ten years ago, when the NHDES declared the town’s effluent disposal capability inadequate and imposed a moratorium on future connections.

To be fair, the moratorium was lifted when the RIB was started up, but the town has said that the system is completely failed and must be abandoned.  Moreover, for the past year the system has been operated at such a diminished capacity that it cannot keep up with the town’s effluent production.

The big question, after nearly ten years, is “Now What?”

Does the town use these funds to reimburse the sewer fund for $1.4 million in legal fees and to retire the debt incurred in building the soon to be abandoned RIB system?

Do the Selectmen and town manager stash away the proceeds of this settlement to be used at their discretion to make new capital projects appear to be paid for by the proceeds of this settlement?

Do the high sewer rates caused by the comedy of mismanagement of the system ever get reduced?

I think we all know the answers.

Tonight, the Selectmen announced a settlement in the RIB lawsuit.  I missed the actual announcement, but will be sure to tune in to the replay tomorrow, and try to get a copy of the agreement through right-to-know  I’m told that the essential deal that was announced is a cash settlement of $7.5 million payable within 90 days.

When asked if the funds would be used to repair the existing RIB site, the response was that alternative disposal methods are being explored by Underwood Engineers.  Presumably, the cash settlement will be used to pay the legal fees and to retire the outstanding debt on the RIB project. 

Yesterday, the court conducted a brief (5 minute) teleconference with the lead attorneys.  This was not the regular monthly conference.  That was scheduled for September 9.

Aside from logging the call,  the docket provides no insight into the subject except to note that Ms. Cull still appears to be our attorney of record.  There was speculation and an unconfirmed report that the town had a falling out with them over post trial developments.  The issue of diversity jurisdiction and venue shopping continues to hang over the case, and whether we really were well advised that there was potential for a reasonable return on the $1.4 million that we have spent with them.

Apparently, the Selectmen feel that the citizens of the town are not entitled to know anything about “their” legal matters.  It’s legitimate to exclude the public from discussions concerning legal strategy and other information that might compromise the town’s negotiating position. But the reality is that the defense knows the current status of the suit and we, the taxpayers that are funding the whole thing, are the only ones in the dark.

Let’s talk about the dynamic of the board of Selectmen.  They require a simple majority to slam the door and talk about this in non-public session.  But to seal the minutes of that non-public session, they require 2/3 vote.  In our town, that means they need 4 out of 5 Selectmen to say the public is not entitled to know anything about what was discussed.  We have at least one Selectman who was elected on a platform of fixing the town’s wastewater system.  From where I sit, there has been no fixing, and a lot of litigating and spending.  Any two Selectmen can change the tone of this by refusing to allow the minutes of these meetings to be sealed.

Next time the newspaper prints an editorial about how nobody showed up for town meeting, think about how the town is run, and the message that the Selectmen send us concerning our right to know what’s going on and to participate in the discourse.

I have been told that the parties have arrived at a settlement to the RIB lawsuit.  I will try to obtain confirmation over the next few days.  Here’s what my source disclosed:

The settlement was agreed to on Friday, August 15.  That would be consistent with the series of non-public Selectmen meetings that were noticed and culminated on that day with a meeting in Boston.

Wright-Pierce has agreed to remediate the site.  I assume that means that in addition to providing the engineering, they will pay for the work.

It’s not clear if the settlement also includes reimbursing the town for its cumulative legal tab of $1.4 million.  There is another report that the town is considering legal action against their attorneys.  The blog suggested that possibility in a previous post.  Given that the town’s attorneys had led them down a golden path with little possibility that Wright-Pierce could pay the staggering amount of the award, and given that the town’s attorneys filed the case in Federal Court with questionable justification, perhaps the town is considering collecting our attorney fees from their professional liability insurer.  I hope not.  I hope they have learned their lesson and stop throwing good money after bad.

No doubt the lack of subject matter jurisdiction dismissal motion undermined the town’s position in the post-trial settlement talks.  But to recover damages from our attorney’s seems like a catch-22 situation.  In order to make the case that they filed in the wrong court, I think they would have to lift the stay on further proceedings and allow the court to actually rule on the motion, and potentially pay for an appeal.  On the other hand, if the court were then to dismiss, Wright-Pierce would have no reason to settle.

Then again, it would be an interesting twist of fate to see Wright-Pierce agree to fix the site, and to work with the town against their old attorneys to recoup legal fees.  After all, it’s in the best interest of both parties.

You can’t make this stuff up.

Today, the Board of Selectmen noticed two non-public sessions with attorneys.  The first meeting will take place Wednesday morning at the offices of our current attorneys, Hinckley Allen & Snyder, at their offices in Concord.

The second meeting will be Friday morning at the offices of Sherin and Lodgen in Boston.  This law firm has never been noticed on the case, so it is not clear which party, if any, they represent.

That’s the extent of what is known.

Of course, the complete vacuum of information that is the Selectmen’s veil of secrecy breeds wild speculation, and regular readers will know that the blog enjoys wild speculation as much as anyone else.

Possibly the settlement talks have been successful, and the meetings are to formalize an agreement.  The meeting tomorrow with our attorneys would suggest that, and it would be the most productive outcome for all involved.

The meeting in Boston on Friday with the previously unmentioned law firm of Sherin and Lodgen is curious though.  It’s not inconceivable that, as has been rumored with Wright Pierce, the town may have had a falling out with their attorneys over the lack of subject matter jurisdiction debacle, and now need to change attorneys. If that’s the case, we’ll know soon enough as new attorneys would need to notice with the court.

Ever the optimist, I’m going with the settlement possibility.

On schedule, the court held a teleconference with the parties in the RIB lawsuit today.  It lasted 5 minutes.  The net result was a continuation of the stay of all proceedings.  The parties will teleconference again on Sept 9.

The reported reason for the indefinite stay of further proceedings is that there are third parties involved in the settlement discussions and it is “essentially impossible at this stage to represent to the Court just how long that process will take“.

There is no additional information provided as to who the third-party could be.  It could be the process of developing the engineering and obtaining construction bids to remediate the RIB as proposed by Wright-Pierce, or it could simply be waiting for the results of the Underwood Engineering study of proposed alternatives with a mind to negotiating that Wright Pierce pay for one of those proposals as part of the settlement.  Or it could be none of the above.

We are probably the only town in New England where the public is told absolutely nothing about the status and future plans of their municipal sewer system.  I guess that goes along with unresolved ongoing problems for eight years and one of the highest sewer rates in the state.  I’m not talking about marginally higher rates, Wolfeboro’s rates are nearly twice as much as a typical city or town in New Hampshire.

Here’s an interesting twist that I’ve been ruminating on.  Wolfeboro has filed a motion in the RIB lawsuit, pursuant to the Consumer Protection Act,  to recoup our legal fees.  I think the amount was something like $1.4 million.  Subsequently, Wright-Pierce has informed the town that there isn’t much left of their professional liability insurance because the amount wasn’t very large to begin with, and it is being further reduced by their ongoing legal fees.

So while Wolfeboro may be legally  entitled to recover their costs under the CPA laws, we as taxpayers actually may be indirectly paying Wright-Pierce’s  legal costs, in addition to our own, because they reduce the total amount that we can recover.

I wonder if anybody thought of that before we spent half-million to amend the complaint beyond what it was reasonable to expect in the first place.

This week’s editorial in the Grunter portrays my position in the RIB lawsuit more accurately than last week, but there are still some pretty important points that need to be corrected.

While much has been made of a 600,000 gallon per day capacity requirement that NHDES asked for in 2007.

THE TOWN DOES NOT NEED THE ABILITY TO DISPOSE OF 600,000 GALLONS PER DAY.

We currently handle a daily average of 400,000 gallons or so, and the trend has been down rather than up.  We simply have no present or anticipated need to handle 50% more wastewater.  There is no credible scenario where the town’s effluent disposal needs increase to anywhere near that amount.

I sat through the entire trial and didn’t hear any convincing testimony that the RIB site was improperly designed.  While it was shown that slope stability issues should have been anticipated, they in fact were.  The 2007 Phase III report by Wright-Pierce says it could happen, as well as wetland erosion issues as we also have experienced. But considering that the town only had a need to actually use the site at 400,000 – 450,000 gallons per day, they advised waiting to see what would happen and spending the additional money to reinforce the slopes on an as-needed basis.

What they did not count on was the town using a whole winter’s worth of effluent to severely overload the system during the first two months of operation.  Expert after expert, from both sides, testified that the site was never actually run at it’s design capacity of 600,000gpd.  It was started up and run at 800,000 – 950,000 gpd and subsequently the slopes did fail.  Wright-Pierce did not learn the full extent of the overloading until the actual chart recorder records were produced in the lawsuit.

Wright-Pierce contends that that initial overloading caused damage that continued to erode the site for years.  Now, even at reduced flows, there are channels that cause water to seep from the hillsides at elevations above the predicted discharge areas.  I picture these to be much like natural springs where groundwater has found a low resistance path to the surface.  The only difference is that these are man-made and in violation of the permit as they represent “discrete discharges”.   The slope remediation plan would fix that.

The town contended that the hillside contained an impermeable layer that severely restricted it’s capacity.  At trial, no evidence was presented that indicated the original modeling was fundamentally flawed.  While the town’s experts were saying that Wright-Pierce did not adequately investigate the composition of the soils at the site, they could show no evidence that the data used in the modeling was substantially wrong.

In December 2013 and February of this year, the town, along with it’s experts, dug a bunch of test pits at the site.  What they reported was that the wetlands were……. wet.  Our expert, Mr. Bowden from Fuss&O’Neil, wrote an opinion that the site was doomed because additional effluent flow in the wetlands would come to the surface.

Wright-Pierce’s experts at Haley and Aldrich responded that the town’s “expert” was applying a standard for groundwater recharge that is contrary to industry understanding, and that under the Fuss&O’Neil theory of the applicable regulations, the site could not have possibly been permitted in the first place.  The wetlands are supposed to be wet, and groundwater originating from the RIB beds is supposed to “recharge” the surface water in these areas.

Fuss & O’Neil’s contention that all water must remain in the ground all the way to nineteen-mile brook is contrary to what was anticipated in the original design.  Much of the effluent is supposed to recharge the existing and newly created wetlands.  The ability of the wetlands to further absorb and process nutrients is a major consideration in the system design.

NHDES apparently sides with Wright-Pierce’s experts.  They said in their letter that the remediation plan plan should be implemented.  Their representatives at trial said that their preference was to work with the town and Wright-Pierce to fix the site.

All of this pit digging and opinion publishing on the eve of the trial was a direct response to the demonstrated feasibility of the remediation plan.  They were desperately building a new argument to convince the jury that the site was a total-loss.  Wolfeboro’s attorneys waited until their last word in closing arguments to claim that the problem was in the wetlands.  Wright-Pierce’s experts, or even their attorney, had no opportunity to refute it.

We need to uncouple the town’s outrage that the system doesn’t handle 600,000 gallons per day from the town’s needs.  Before the town asks for millions to build new disposal facilities, they need to tell us why they will not consider what it will cost, both initially and operationally, to fix the system we have now to serve our actual needs.  We can argue about who pays for it, but at the end of the day, we need a system that works and it’s in everyone’s best interest to be objective.

The editorial in the Grunter this week is telling in it’s almost knee jerk defense of the town dogma regarding the RIB lawsuit. 

But that’s not the point.  My letter doesn’t question the merits of the lawsuit, who’s to blame, or whether there was an alternative course of action.  It simply lays out the current status, because the town has neglected to inform us of these important developments.  Nowhere does the editorial refute any of those developments.

I’m not going to get bogged down in arguing who’s right or wrong in the lawsuit.  The blog has plenty of opinion about that and more importantly, plenty of documents that you can read for yourself.  I’ve got my opinion, the town has theirs, and at the end of the day people hear what they want to hear.

After 5 years of telling us nothing about the problems, negotiating with Wright-Pierce in secrecy, and prosecuting a lawsuit, here’s what we have:

• A $1.4 million legal bill.
• A Rib site that continues to deteriorate and according to the town cannot handle our current needs.
• A lawsuit that has been suspended and may be dismissed.
• A potential judgement that the defendant probably cannot pay.

At what point do citizens get concerned that there may have been better choices?  Everyone at the Deliberative session this year got a good look at the emotion that underlies this dispute.  Based on that performance, do you think it’s possible that some objectivity may have been lost?

My letter just says that after five years and poor results, it’s time to bring this mess out of the closet.  If these really are the best options, if we have to pay the bill, then lets get it out in the open and talk about it.  Let’s argue about it.

The Grunter says that they are “puzzled” that Wright-Pierce hasn’t found a solution after five years.  I’m puzzled how the Grunter missed that Wright-Pierce presented a remediation plan to NHDES who subsequently recommended it be implemented.  Wolfeboro’s own expert, Mr. Cullen offered a qualified opinion that it could work.  After NHDES gave their nod, Wolfeboro halted the plan in its tracks by refusing to allow Wright-Pierce on site to do a follow-up wetland study and by petitioning the court to prohibit presentation of the plan at trial.

Heck, when I tried to get a copy of the plan back in November of last year, one of the Selectmen, the Town Manager, and the Town attorney showed up in Superior Court to object to my right-to-know request.  I found out later from another right to know email that the town attorney actually saw no reason to withhold it from me.  It became clear later that the objection was to my telling people there was a plan at all.  I guess it worked.  The Grunter is still perpetuating that myth.

The last official statement the Selectmen made to the public regarding the RIB lawsuit was an announcement of the favorable verdict in the trial back in May. Since then, a lot has happened, and I’ve tried to cover it in the blog. Nevertheless, many people are still under the impression that the town will soon be getting a check for tens of millions of dollars. That could happen, but based on the information that is publicly available, I would say it is unlikely.

The actual lawsuit has been suspended. By mutual consent, the parties have agreed to indefinitely stay further proceedings, including Wolfeboro’s motion for treble damages and costs, which would bring the total award to about $25 million.

Wright-Pierce has hired new lawyers that specialize in appeals. They immediately filed a motion to dismiss for lack of subject matter jurisdiction.  Along with this memorandum of law. Basically, they are saying that because Wright-Pierce maintains their home office in Portsmouth New Hampshire, the suit should have been filed in State Court. Lawyers I’ve talked to say that the motion could well succeed on appeal, putting everyone back to square-one. At a minimum, Wolfeboro’s lawyers are saying that responding to the motion will result in substantial additional costs.

In the joint motion to indefinitely stay further proceedings, Wright-Pierce disclosed that their professional liability insurance is “considerably less than the un-multiplied amount” of the original damages claim of $7 million. Moreover, their policy limit includes the amount they spend on legal defense. Wolfeboro has spent in excess of $1.4 million, and it’s reasonable to assume that Wright-Pierce has spent the same to date. So between the two sides, probably $2.8 million has been spent on legal costs. If Wright-Pierce has $3 million in insurance, as has been rumored and is suggested in the motion, there is nothing left. Big surprise that our attorneys agreed to cease activity – the money is running out.

Also disclosed in the trial and in various filings are some hints at Wright-Pierce’s assets. Their annual revenue is around $20 million. They have said that they do not own any of their offices. It’s reasonable to assume that they lease their cars and any substantial equipment as well. Their most valuable asset as a corporation is probably their reputation, which Wolfeboro has spared no expense to destroy with allegations of fraud.

It’s hard to imagine that Wright-Pierce has the will or resources to pay anything close to the awarded damages. Nor does it seem likely that they have the collateral to borrow millions. The joint motion says the parties are in talks to settle. It’s not clear if Wolfeboro is trying to determine how much cash they can get, or if they are considering accepting Wright-Pierce’s original proposal to fix the site.

One thing that’s clear is that the town needs to do something about the situation sooner rather than later. At the diminished flow rate of 180,000 gallons per day claimed at the trial, the storage pond will be full next spring. The ongoing studies of alternative disposal methods would require voter approval and either a cash settlement or bonding to finance. That could take years.

After sitting through 17 days of trial testimony, I believe the problems at the RIB site can be mitigated to serve the town’s needs. If that is an option on the settlement table, we have a right to hear the proposal and to have the reasons for and against discussed in public.

That’s apparently how the RIB lawsuit will be monitored going forward.  Yesterday, the  court conducted a conference in chambers with the two parties.  The only result published in the docket was a notice of a follow up telephone conference scheduled for a month from now on August 7.

The conference was attended by two of the Town’s attorneys and the two new Wright-Pierce attorneys.  It lasted all of 28 minutes.  There is a note at the end of an appearance by a new attorney, Andrew Dunn.  His bio says he is a high-powered appeals lawyer.  He has not been noticed on the case and it is not clear which side has retained him.

So it appears that the court is going along with the joint motion to indefinitely stay further proceedings, at least for a month.  My sense is that the court will not want to do this indefinitely, and will be looking for real progress toward settlement.  Maybe the Selectmen will tell us what’s going on – ha ha.

The town spent $1.4 million on a legal team, has a $15 million award with another $10 in the works and probably can’t even expect to collect the original claim. They have all but committed to shutting down the RIB facility as part of their case.  Our attorney told the jury in closing arguments that the town will need to shut it down and put a fence around it because it is a contaminated hazardous site.  Why should the public care?

Today, the parties filed a  joint motion to indefinitely stay further proceedings  in the RIB lawsuit.  They are effectively freezing all legal activity indefinitely while they try to work out a settlement.  In the motion they state that settlement talks have been ongoing since the verdict, and that they need to engage some third parties to develop the settlement.

Within the motion they state that Wright-Pierce’s liability insurance policy is “considerably less than the un-multiplied amount of the damages alleged by Wolfeboro”.  The un-multiplied damages were around $7 million.  One rumored limit heard by the blog was $3 million, which would be consistent with that statement.

Another disclosure about the liability  insurance is that it is a “defense-within-limits” policy.  They explain that the limit includes their legal expenses, so the million or more that Wright Pierce has spent on their legal defense is money that will not be available to pay any settlement.  So potentially there is only a couple of million or so available from insurance.  Any settlement beyond their coverage would have to be paid by Wright-Pierce.

That would include the town’s current legal bill that’s currently north of $1.4 million as claimed in their motion for costs.  So the remaining insurance money to pay actual damages may be less than a million dollars at this point.  It should be no surprise that they have pulled the plug on further legal activity on the outstanding motions.  Wolfeboro’s lawyers are saying they want to conduct discovery as part of their objection to the motion to dismiss for lack of subject matter jurisdiction. Cha-ching.  Between the two legal teams, just resolving the current issues and getting the final judgement could consume all of the remaining insurance money.

So I’m not going to hold my breath waiting for millions in damages from Wright Pierce.  I hope the town can get back what they paid for lawyers and get the thing fixed.

The court has scheduled a hearing in chambers on July 9.  Too bad the public is being excluded, I would like to hear the arguments, even if I think I know the probable outcome.

The subject-matter jurisdiction rule, at least as described by the defendant’s motion, seems to be meant to discourage venue shopping.  From my perspective with the information available to me, some of the rulings in this case seemed to favor the Plaintiff.

From what appeared to be different standards for expert witnesses, to the suppression of the defense’s remediation plan, to ruling against a contributory negligence defense, if I were Wright Pierce I would probably feel that I wasn’t allowed to properly make my case at best.  At worse I might believe that the jury may have picked up on a perceived predisposition of the court.

So it comes as no surprise to me that the first thing a new attorney on the case would do is look into the circumstances of how this case came to be heard in this particular venue, and go for a mulligan.  Worth a shot.

That’s basically what the first motion from Wright Pierce’s new attorneys says. Quite a bold move, but then the stakes are high and you can expect just about anything.

What they have filed is a Motion to dismiss for lack of subject matter jurisdiction. Basically, they are saying that the US District Court does not have jurisdiction over this matter because Wright Pierce’s “principal place of business is Portsmouth New Hampshire”.

In the associated memorandum of law, WP cites Wolfeboro’s justification for filing in Federal Court:

Jurisdiction is based on 28 U.S.C. §1332(a)(1), which grants this Court original jurisdiction over actions between citizens of different states when the amount in controversy exceeds $75,000 exclusive of interest and costs.

In the motion to dismiss, WP argues that case law indicates that a corporation is a citizen of both the state of incorporation (Maine) and the state of their principal place of business (New Hampshire).   They file affidavits and related org charts to show that their President Bill Brown and most of the corporate team has been in Portsmouth since 2007, and that the Portsmouth office was the corporate “nerve center” in 2012 when the suit was filed.

Seems incredible that this issue is being raised after the trial, but they are arguing that the Federal Court is a court of “Limited Jurisdiction” and that anytime it is discovered that the court has exceeded it’s jurisdiction, the only remedy is to dismiss, regardless of who failed to previously recognize the defect.

I expect that the court will deny this motion, and that the merits of the argument will ultimately be decided on appeal.

Donovan Hatem has filed a withdrawal as attorneys for Wright Pierce.  Two attorneys from the firm of Sheehan Phinney Bass & Green have filed notice of appearance with the court.  They are Peter Cowan and John-Mark Turner.

Also filed today was a motion to extend time to object  to Wolfeboro’s outstanding motions for treble damages and costs.  The motion states that “…a situation has emerged that precludes further representation of Wright-Pierce by Donovan Hatem.   As a result of that situation, Wright-Pierce was required to engage new counsel to represent its interests with respect to the trebling and attorneys’ fees and costs issues, post-trial motions, and an appeal.”  It goes on to say that the new team was just engaged this past Friday, June 6 and that they cannot meet the current June 13 deadline.  They ask for 4 additional weeks, extending the time until July 11.

Although we all knew it was coming, this is the first formal mention of an appeal.

Wolfeboro has assented to the motion to extend,  therefore it probably will be granted by the court.

The court has ruled  in the Consumer Protection Act claim 5.  The jury had found in Wolfeboro’s favor but the court has the last word.  The judge confirmed the finding of the jury and in addition found that the damages were $7,658,532 – the originally claimed amount.  The jury had found the damages to be $6,795,000.  As I understand it, this amount will supersede the jury’s finding.

This award amount is automatically doubled, so $15+ million, and Wolfboro has until the end of the month to file a motion to increase it to treble damages.  Moreover, the town can (and no doubt will) file for costs.

As I sat at the back of the courtroom for three weeks, the question people kept asking was “exciting isn’t it?”.  Of course, the implication was that the slow pace was like watching paint dry.

But once you get into the rhythm of it, you realize that there is a lot of information being presented that just isn’t as directly available elsewhere.  If you want to understand the dilemma that our town faces, the primer on land based disposal was very informative.  Here’s what I got out of it:

Basically, waste water systems have two components.  First there is a treatment facility that essentially does all of the serious cleanup of removing solids and in our case cleaning up the organic components with bacteria that essentially eats it and settles out.  The resultant effluent is bacteriological inert but contains a high level of the nutrients nitrogen and phosphorus.  Those nutrients are the first two of the three numbers on a bag of fertilizer.  Like 5-10-5 contains 5 parts nitrogen, 10 phosphorus, and 5 potash.

We all know that the DES tries to prevent people from using fertilizers near the waterfront because the runoff can cause algae blooms and weeds.  The treated effluent from the Waste Water Treatment plant isn’t much different.  The nitrogen and phosphorus can actually be lower than the standard for drinking water, yet it cannot be released into a lake or pond in large quantities because it will “fertilize” the lake and cause unwanted growth.  It is a form of pollution.

So after treatment, the effluent must be disposed of in a way that doesn’t affect lakes, ponds, or even nearby property.  Most large municipal systems discharge into moving rivers, where the effluent is diluted so much that it is virtually undetectable downstream, and the moving water cannot produce algae.

When there is no suitable river available, the problem gets very complicated.  You need to dispose of the effluent over land.  The basic methods are:

• Rapid Infiltration
• Slow Infiltration
• Spray Irrigation

When the effluent travels through the ground (groundwater), it naturally loses it’s nitrogen and phosphorus, to the point where it can later emerge from the ground as surface water and be as benign as rainwater.  Both Rapid Infiltration and Slow Infiltration are methods of getting the effluent to sink into the ground, merge with existing groundwater, and clean up as it travels to some discharge point months later.  Slow infiltration uses the drip irrigation concept with buried pipes.  Unlike spray fields, it can be designed to operate year round.  Spray irrigation results in some amount of groundwater “recharge” and also benefits from evaporation and transpiration through plants.

According to testimony at the trial, Rapid Infiltration is by far the most economical form of land-based disposal.  The other methods involve much larger tracts of land as well as miles of pipe and/or tubing.  But the most significant factor for Wolfeboro is the geology of the town.  According to testimony, most of the land in town has a very shallow depth to bedrock, and so the carrying capacity of the unsaturated “overburden” soil in many places is unsuitable for any type of infiltration.

One geologist who testified said that looking at a topographical map of Wolfeboro, there were only a few formations that would appear to a geologist to be suitable for land-based disposal.  Those areas were obvious glacial deposits that would be composed of a lot of sand and be free of bedrock.

The town currently disposes of about 20%-25% of it’s effluent, about 30 million gallons,  on about 46 acres of spray fields.  That’s about 650,000 gallons per year per acre.  Extrapolating the town’s needs of about 160 million gallons per year, the current spray field equivalent is about 250 acres of spray fields.

Without a doubt, better suited land can be found and switching to a year-round technology would double the capacity and halve the land requirement.  So maybe 100 well selected drip acres could dispose of the town’s current needs of 160 million gallons, or say 135-150 acres of drip to get an equivalent of the 600,000 gpd that the RIB was supposed to provide.

The cost comparisons between RIB and other land based disposal methods include all of the life-cycle costs.  While our RIB system has been expensive to operate because of the problems, most ribs have very low operational costs.  The various forms of slow infiltration like spray and drip will have higher maintenance and operational costs because of the complexity of miles of pipes and dozens of monitoring wells.

So I hope the town thinks through the whole plan for the next 20 years or so before deciding there is a surplus from the punitive damages they extract from Wright Pierce.

The court acted swiftly on Wright Pierce’s latest motion to stay judgement on the Consumer Protection claim.  The outstanding motion for judgement as a mater of law was denied, and the motion to stay consume protection verdict was denied.

Today we enter the new post-trial phase of the lawsuit.  Wright Pierce has filed a motion to stay any hearing and ruling by the court on the Consumer Protection claim, pending the outcome of “various” other post-trial motions that presumably will be filed soon.

Wright Pierce is asking that those motions be heard prior to any final determination on the Consumer Protection claim.  In addition, they have an outstanding motion that deals directly with their request for a directed verdict on the CPS issue claiming insufficient evidence.

Then there’s a potential appeal….

Not sure how long this kind of activity will take, or if there is a way the town can leverage a favorable settlement from the circumstance.  I don’t know how realistic this would be, but what if Wright-Pierce were to accept a structured settlement that included fixing the RIB system and demonstrating some capacity over say – six months to a year, with subsequent cash payment dependent on that capacity.

The advantage to Wolfeboro would be that bulldozers could be at work this year, and if the remediated capacity were 300,000 – 400,000 gallons, the town could pocket whatever excess cash were in the deal and use the existing seasonal spray fields for the remainder, if necessary.  It would not be possible to demonstrate capacity more than 400,000 gpd because we don’t generate more than that, so maybe legal fees, cash for the unprovable (and probably unattainable) 600,000, and then demonstrated performance or cash for what they can salvage.

If Wright Pierce declined, or tries and fails, that would be proof positive that the site is useless and the town would get the full settlement to do something else.  At least we would be working toward a solution to the real problem.

Wright Pierce gets the opportunity to save their reputation and “not leave town till it’s fixed” as they claimed at trial.  Wouldn’t it be better to start fixing the problem?

At the heart of the lawsuit was the interpretation of the various representations of daily-limit, and daily average measured monthly, and annual average.  The town ran the RIBs at 850,000 to 940,000 gallons per day in the five days leading up to the failure.  The town says there was no daily limit, and that they complied with the monthly limit.

The way the town presented the issue, there is no daily limit at all.  Mathematically, as described by them, there was only a monthly limit of 18 million gallons.  That’s what 600,000 gpd monthly average works out to.  Using that interpretation, it was acceptable to put 18 million gallons in one day, or 2 million gallons per day for nine days, or 1 million gallons per day for 18 days, or 850,000 gallons per day for 21 days (what the town was doing).

The hydrogeological  model produced by Wright Pierce indicated the site had a capacity of 600,000 gallons per day, and would probably fail at 800,000 gallons per day.

So if you believe in this monthly average theory, you would still blame Wright Pierce if the town had pumped 2 million gallons per day for that week in April 2009.  Think that might be pushing it?  OK, so the real question is who decides?  Who decides what’s reasonable and safe if there is only a monthly limit of 18 million gallons and the site was rated for 600,000 gallons per day?  At the trial, Wolfeboro argued successfully that the jury could not be asked to decide, that Wright Pierce needed to produce an expert with a smoking gun.

We know who takes the fall, but the fundamental question remains. A wise old man that I once knew always said “The blame has no home”.

The court just posted the verdict.  Wolfeboro prevailed on all five counts.  The jury awarded damages in the amount of $6,795,000.

As I understand it, count 5, the violation of the consumer protection act was an advisory verdict by the jury and the court makes the final determination as to the standard of law and multiple damages.  I don’t know when that will happen, but the damage amount can double or triple based on the decision of the court, and probably will award attorney and other costs.

I’ll post that decision when it becomes available, but I think it requires reconciling the facts submitted by the parties and may take a few days to rule on.