University of Oregon Economics Prof. Bill Harbaugh last week filed a complaint (PDF) with the Oregon State Bar against prominent Eugene lawyers Bill Gary and Sharon Rudnick and University of Oregon General Counsel Randy Geller.
The complaint accuses Gary and Rudnick of misleading Marion County Judge Thomas Hart about the value of legal services their firm, Harrang Long Gary Rudnick, provided in a public records battle with the Oregon Department of Justice. The complaint accuses Geller of helping the lawyers mislead the judge with a less than candid affidavit in support of their request for fees.
The lawyers deny any wrongdoing.
The complaint stems from one of the biggest legal skirmishes in recent Oregon political history. The Oregon Department of Justice, led by then-Attorney General John Kroger, launched an investigation in the summer of 2010 into a contract that the Oregon Department of Energy issued indirectly to a company owned in part by Cylvia Hayes, the longtime companion of Gov. John Kitzhaber.
The investigation led to the temporary suspension of four Department of Energy employees, including interim Director Mark Long, but ultimately led to no charges. Long, whose father, Stan Long, is a longtime powerbroker and former deputy attorney general. He alsoran the state-owned workers' compensation insurer SAIF Corp., and co-founded Harrang Long Gary Rudnick. That firm brought its considerable influence to bear in a quest to clear Mark Long's name.
In the DOJ investigation, Harrang Long lawyers Bill Gary and Dave Frohnmayer represented Mark Long. Frohnmayer is a former Oregon attorney general and University of Oregon president; Gary, a top lieutenant of Frohnmayer's at DOJ, is one of the state's top lawyers.
Gary and Frohnmayer's firm sued then-AG Kroger and DOJ for the agency's handling of the investigation, alleging DOJ had withheld and mishandled public records related to the investigation. A Marion County judge found partially in their favor and awarded the firm legal fees of $550,000. (The Department of Justice is appealing that award.)
The same month the public records case was decided, Kroger resigned to become president of Reed College, his once-promising political career tarnished by the mess of the Department of Energy investigation.
In their request for legal fees, Harrang Long presented a schedule of its lawyers' charges, which topped out at the $550 per hour that Frohnmayer billed.
That schedule of charges is part of the basis for the bar complaint Harbaugh filed on May 27. In his complaint, he alleges that Harrang Long used one fee schedule to justify costs in the Long v. Kroger case but in current work it is doing for the University of Oregon, the firm charged much lower hourly rates for the same lawyers.
In effect, Harbaugh is arguing that the firm duped Hart, the Marion County judge, into awarding fees based on artificially high invoices.
Gary says that allegation is without merit.
"Dr. Harbaugh claims that our submissions to a court, (in a case involving neither him not the University) were inaccurate. On the contrary, the submissions were both truthful and candid. The hourly rates that we charged in that case, and which the court awarded, were the Firm's standard hourly rates that we routinely charge clients for similar work," Gary wrote in an email to WW.
"Like most law firms, the Firm sometimes considers alternative fee arrangements based upon the nature or volume of work involved. The Firm has agreed to perform work for the University at discounted rates. We are not aware of anyone other than Dr. Harbaugh who has expressed concern about our willingness to provide a discount to the University."
A second cause of Harbaugh's complaint is an affidavit that U of O General Counsel Geller submitted to the court in support of Harrang Long's request for legal fees.
In that affidavit, (PDF) Geller wrote that he had wanted to hire Harrang Long to represent the University in various legal matters but that the Department of Justice refused, saying the representation would represent a conflict of interest. Geller's affidavit supported Harrang Long's contention it had been deprived of legal work because of the Long v. Kroger case and therefore deserved not only legal fees, but should have them doubled because the economic penalty meted out by the Department of Justice's conflict of interest claim.
Again, Harbaugh claims foul.
In his bar complaint, Harbaugh notes that Geller wrote his affidavit in July 2012. He further notes that Geller hired Harrang Long to represent the University in February 2012, five months earlier, to represent the university in a faculty union organizing drive. After the faculty unionized in April 2012, Harrang Long continued to represent the university in negotiations with the faculty.
In his complaint, Harbaugh faults Geller for failing to mention in his affidavit that Harrang Long, despite getting blocked from some University work, was handling the unionization issue.
"[Geller] gave the court a detailed statement about the legal work UO had been unable to give [Harrang Long] because of the Long case, while omitting the substantial work he had been able to give them, a fact which would have been as relevant in arguing against doubling the [Harrang Long] fees as were the facts which he did choose to report to the court," Harbaugh writes in his complaint.
Geller says the affidavit he filed with the court was accurate.
"My declaration was complete," he told WW via email. "It addressed the issue of whether [Harrang Long] was not approved to represent the University in specific cases. During the time frame addressed in the declaration, the State's approval was required for [Harrang Long] (or any other firm) to represent the University in the cases described in my declaration because the University's defense was covered by the State's risk fund. The University was able to hire [Harrang Long] in 2012 for work that was not covered by the State's risk fund, including work on the faculty union matter, because the State's approval was not required."
Harbaugh's complaint is not the first Bar issue to arise from the DOJ investigation. In 2011, Gary and Frohnmayer filed a bar complaint against former DOJ criminal chief Sean Riddell over his tactics during the Department of Energy investigation. That complaint was dismissed last year.
A Bar spokeswoman says the Bar is considering Harbaugh's complaint.