Wednesday, May 20, 2009

Duke’s Soaring Brodhead-Steel Defense Costs

Attorney and former Chronicle editor Ed Rickards writes frequently about Duke’s finances. Often what he says has not been confirmed by Duke or appeared in The Chronicle.

But Ed’s numbers have always stood up as have his analysis of what the numbers mean for Duke.

A few days ago Ed sent the following - - -

I have just acquired new figures about Duke's soaring legal bills.

-- these are for the 2007-2008 school year. Nothing more current will surface for at least nine months.

-- Duke does not indicate the reason for these soaring costs. But I follow Duke affairs closely, and know of no other substantial litigation other than the lacrosse cases.

-- The biggest bill comes from Jamie Gorelik and her Washington law firm, apparently performed through their Philadelphia office. We know this firm was retained to work on lacrosse matters.

So we start with the term "legal fees."

It's not known if this includes reimbursement of expenses to law firms. For example if a lawyer flies to Durham, is it covered on this line or under the line for "travel." These law firms run up substantial bills in addition to fees -- charging for every xerox and paper clip.

New legal costs figure:

2007-2008 academic year --- $17,040,989

Previously known legal costs figures:

2006-2007 --- $10,207,165

2005-2006 --- $5,879,719

2004-2005 --- $4,316,301

Note: the Prosecutor Nifong - Prostitute Mangum hoax embraced three months of the 2005-2006 school year.

Note: the leap from $10 million to $17 million is extraordinary. 70 percent. In this period, undergraduate financial aid only increased 11 percent, a Brodhead priority.

There's more:

For the first time, I can report on fees paid to Wilmer, Cutler and Pickering. Their partner Jamie Goreleck was retained to review the lacrosse litigation. So far as is known, this is their only activity for Duke.

Wilmer,Cutler has leaped to the 5th largest professional contractor dealing with Duke University, with payments during the 2007-2008 academic year for professional fees of $1,966,288. This law firm charges at least $800 an hour for a partner's time. At least. Again, I do not know if this total embraces all the costs the firm runs up or just fees for lawyers.

Best regards,

Folks, I’ll say three things:

1) --- I don’t doubt what Ed’s reporting.

Many of you will recall Ed’s op-eds in the Durham Herald Sun and my posts here reporting information he provided which weeks and months later Duke would finally confirm.

Ed, for example, revealed Duke’s huge endowment drop at a time when President Richard Brodhead and BOT Chair Robert Steel were fobbing off the university community off with a faux back-and-forth routine reminiscent of Laurel and Hardy.

“Things are just fine and there’s no need to worry, right Ollie?”

“That's right, Stanley. And that’s because we’ve managed the endowment so wisely.”

2) --- I checked last night with two attorneys not themselves employed by Duke, or members of law firms representing Duke, or firms who’ve represented litigants in cases growing out of Duke’s scandalous response to Mangum and Nifong lies, which cases have been settled, or firms representing plaintiffs who’ve brought still unsettled suits against Duke in connection with its scandalous response to Mangum’s and Nifong’s lies.

The attorneys told me the figures Ed’s presented seem, if anything, low given all that’s transpired.

They also noted that attorneys usually bill clients such as Duke in arrears, so that Duke’s actual legal costs to date are almost certainly significantly higher than what Ed’s reporting.

There’s more I’d like to report but time is very short.

3) -- Why haven’t The Chronicle and Duke Magazine reported on the costs of defending Brodhead, Steel and the rest of the Duke Defendants?

Both publications claim to serve the Duke community.

But keeping secret the huge attorneys’ and settlement fees Duke's already run up only serves the interests of Brodhead, Steel, the other trustees, the other Duke Defendants, and many others not named as defendants in any suit but who did their part in crafting and/or enabling the most disgraceful chapter in Duke’s history since it officially repudiated racial segregation practices.


Ken said...

The 70% jump looks even more outrageous when you figure that the previous year had a 73% increase. In two years the costs tripled.

Anonymous said...

This is what is known as buying justice -- the law firms are no doubt big political contributors and, in the end, some procedural maneuvering may result in the case being disposed of on favorable terms, and perhaps quietly fizzling out.

One wonders what Durham has had to pay thus far and suspects that it is substantially less.

At some point, Duke is going to spend more than it would have cost them to settle -- this can be viewed as hush money and as more money extorted from Duke by Durham. In addition to the silence, they are protecting Durham from having to have court-appointed supervision of the DPD, despite a long-standing pattern of DPD and city hall victimizing Duke students.


Anonymous said...

Would not Duke students have a case for a broad class-action lawsuit against Durham for the disparate police treatment of Duke students and Durham residents?