By NANCY WEST, InDepthNH.org
The state is paying an out-of-state law firm to vet claims by victims who were abused as children while incarcerated at the Sununu Youth Services Center in Manchester – then called YDC – out of the same $160 million the legislature approved to compensate victims through the settlement fund.
The Verrill Dana law firm of Portland, Maine, was also employed in the civil trial of YDC victim David Meehan against the state Department of Health and Human Services, but the state says it didn’t use the victims’ settlement fund for that purpose.
Mark Knights of the firm Nixon Peabody, who represents most of the 1,400 victims, is troubled by the fact that the Maine law firm is recommending the settlement amount that should be paid on claims from the settlement fund. The firm has an incentive to recommend as small an amount as possible for victims that will come from the same pool of money from which the firm is paid, Knights said.
The Verrill Dana firm has either been paid or is waiting to be paid $2.8 million from the settlement fund, according to the most recent quarterly report submitted by John Broderick, the fund’s administrator.
“It should be of significant concern to New Hampshire taxpayers that the Attorney General’s Office—which employs more lawyers in New Hampshire than any single law firm—looked outside its own office and hired out-of-state lawyers who specialize in bankruptcy law and intellectual property to do this kind of sensitive work with deeply traumatized victims,” Knights said.
“Although the AG’s Office says this was anticipated when the legislation was passed, you won’t find any reference to hiring an outside law firm anywhere in the statute.
“It’s shocking that the AG’s Office apparently intends to continue to funnel settlement money intended for victims to these outside lawyers, even though the revised legislation contemplates a reduced role for the AG’s Office in the process. Why are they spending public money on private lawyers to do work the AG’s Office isn’t even required to do?”
The Verrill Dana firm referred questions to the Attorney General’s Office.
Mike Garrity, spokesman for Attorney General John Formella, said the victims settlement fund didn’t pay out anything to Verrill Dana for the trial in David Meehan’s civil lawsuit against the state Department of Health and Human Services for the hundreds of beatings and rapes he endured which incarcerated at YDC in the 1990s.
According to an April 30 invoice to the Department of Justice, Verrill Dana charged the state $501,669 for their work on the David Meehan trial.
Meehan won his civil lawsuit against the state Department of Health and Human Services for hundreds of beatings and rapes he endured during his stay at YDC in the 1990s. The jury awarded Meehan $38 million, but the state is fighting to reduce the award to $475,000.
Court settlements are different than those settled in the settlement fund and would have to be paid out of the general fund because New Hampshire is self-insured.
Verrill Dana lawyer Martha Gaythwaite represented the state Department of Health and Human Services, along with several attorneys from the Attorney General’s Office against Meehan.
Any payments to Verrill Dana for work done by that firm on the Meehan civil case would come from the NH Department of Justice litigation budget, not from the victims settlement fund, Garrity said.
“Part of our role at NH DOJ is to protect the integrity of the fund and ensure that victims are being appropriately compensated. To fulfill that role, we require outside support given the volume of claims,” Garrity said.
He said the vast majority of appropriations from the victims fund are being awarded as settlements to victims.
“NH DOJ’s outside expenses are a small fraction of the total amounts paid out, and they will continue to be going forward. These expenses are dedicated to ensuring that the administration of the fund runs smoothly; that every claim is reviewed and analyzed; and that victims are heard and compensated efficiently by allowing our office to resolve many claims without the need for a resolution proceeding before the Administrator and narrowing the gap in many other cases.
“The out-of-state firm was selected for their litigation expertise and capacity to handle both the intake of claims and the preliminary recommendation of settlements impartially,” Garrity said.
All of the $2.8 million listed in the Attorney General’s Office victims fund for special and outside expenses to date in the quarterly report have gone to the Verrill Dana firm, Garrity said.
Verrill Dana charges the settlement fund for claimants a $2,500 intake fee, $2,500 for selection of resolution proceeding and $3,000 for a preliminary recommendation.
Many New Hampshire firms are involved in litigation related to YDC, Garrity said.
“For example, Nixon Peabody and Shaheen & Gordon represent plaintiffs, and nearly all other mid- and large-sized firms—including McLane Middleton, Devine Millimet, Morrison Mahoney, Preti Flaherty, Gallagher, Callahan & Gartrell, and Orr & Reno—already represent third-party contractor defendants in various litigation cases, meaning that the ethical rules concerning conflicts prevent them from being able to also assist with the claim fund,” Garrity said.
The law establishing the victims settlement fund has been revised and became effective June 14, causing some delays in processing and paying out claims until Aug. 31.
The revised law made some significant changes, including allowing Broderick to pay out awards over up to 10 years, which could be a hardship for victims who have borrowed large sums at high interest rates against their claims because the longer the loans are not repaid the more the victim owes.
The revised settlement law was intended to draw more YDC victims to the settlement fund process where there are caps on how much victims can be paid instead of going to Superior Court where a jury would decide the award.
Knights said some of the other changes in the law for victims mean:
*If a claimant has pursued a claim in the settlement fund to completion, that claimant can’t seek additional compensation under the settlement fund, even if they allege forms of abuse that weren’t previously covered (solitary confinement, unlawful strip searches, etc.).
*By accepting a settlement under the fund, however, a claimant usually doesn’t sign away their right to pursue those previously un-covered claims. Unless the claimant has agreed with the Attorney General’s Office to globally resolve all their claims of abuse at YDC with a settlement, they’re free to pursue claims based on solitary confinement, unlawful strip searches, and that type of conduct in court.
*In practice, any claimant who’s (a) accepted the Attorney General’s position on their claim or (b) has had Administrator Broderick make a decision on their claim may not be able to refile. If, however, the claimant’s claim hadn’t already been resolved by the time the new statute was enacted, they shouldn’t be barred from obtaining compensation under the fund for the “new” types of abuse recognized.
Knights said Broderick has started up resolution proceedings again, and the Verrill Dana attorneys continue to be intimately involved in the settlement fund process.
“Usually, it is only Verrill Dana attorneys and paralegals who attend the resolution proceedings on behalf of the state, with no representative from the Attorney General’s Office there,” Knights said.
