One of Colorado's most powerful law firms has gone face to face with the tiny Moffat Tunnel Commission--and the lawyers blinked.
Earlier this year, the attorneys at Brownstein Hyatt Farber & Strickland sent the tunnel board a bill for $28,000 for sixteen days of work. Among other things, the law firm charged up to $250 per hour for time its attorneys spent discussing whether they had a conflict of interest representing the state agency--which, it turns out, they did.
When the obscure but irascible tunnel board objected to the bill, it simply didn't pay it for more than three months. And when the state agency did write a check earlier this summer, it was for half the amount--a portion the law firm grudgingly agreed to accept as full payment.
"We were actually stunned at the size of the bill presented to us," says tunnel commission president Edward J. "Jake" Jakubowski Jr.
The tunnel board's hiring of the politically connected 17th Street firm was controversial at any price. The five commissioners, elected to oversee a pair of railroad and water tunnels built in the 1920s, have few official duties left. But they nonetheless retained Brownstein Hyatt to help them fend off an effort in the state legislature to abolish their agency. That measure was backed by the Winter Park Recreational Association, a group of prominent businessmen and socialites who pay their staff handsomely to run the Winter Park ski area for the City of Denver and with whom the commission has been involved in a long-running feud.
The tunnel board owns the land on which Winter Park's base facilities are located, but under the terms of a sweetheart lease signed by a previous group of tunnel commissioners, it receives no rent. Last year the tunnel board sued the WPRA in an effort to void the lease and boot the ski resort off its land. That prompted Winter Park to counter with its legislative end-run, touching off a heated battle at the Capitol.
Brownstein Hyatt assigned three attorneys to the skirmish, including name partner Thomas L. Strickland, a $250-per-hour lawyer rumored to be mulling a run for the U.S. Senate, and Cole Finegan, a former legal advisor to Governor Roy Romer who charges $210 an hour.
The firm knew from the start it had a potential conflict, since partner Steve Farber had represented Denver Mayor Wellington Webb and City Attorney Dan Muse when they attempted to cut a secret deal to sell the ski resort to the WPRA in 1993. However, it took the case anyway and ran up $9,605 in charges in the first ten days. According to the firm's billing statement, a good part of those expenses involved Brownstein Hyatt attorneys talking to each other--and to a second law firm the commission had hired--about the case.
The tunnel board paid that first bill in full. But it balked when it got the follow-up invoice--which arrived just days after Dan Muse belatedly decided that Brownstein Hyatt did indeed have a conflict, forcing the law firm to withdraw at the height of the legislative battle.
That second billing statement included a charge from a $70-per-hour assistant to "obtain" a copy of an article by Denver Post columnist Chuck Green, who has regularly ridiculed the tunnel board. Finegan tacked on subsequent $210-per-hour charges for preparing for and then holding a "conference" with the newspaperman. "We went in and said, `There's two sides to this story,'" recalls Finegan. Days later, Green responded with a column urging legislators to get rid of the tunnel commission.
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Finegan and Strickland also billed for holding several "conferences" with each other, and Strickland even tacked on a $450 charge for spending roughly two hours discussing the firm's "conflict issues" with Finegan.
Finegan says he believes his firm was "very effective" in its work for the commission but that it agreed to accept a reduced payment in part because it had to bow out before the job was done. "From time to time, we certainly have clients where we have taken less than the full amount," says the attorney somewhat sheepishly. "But we try not to make it a habit."
Jakubowski says that in retrospect, the tunnel board probably should have dumped the firm as soon as it learned it might have a conflict. Meanwhile, he says, the commission plans to continue its expensive war with Winter Park--but will keep pinching pennies wherever possible.
"People can say what they want about the MTC," adds the tunnel boss. "But if everyone ran as tight a ship as we do, we wouldn't have the problems we do in government.