Orrick Agrees to Settle San Diego Malpractice Suit for $2.8M
Orrick Herrington & Sutcliffe has agreed to pay San Diego $2.8 million to settle a malpractice suit that contended the law firm failed to uncover the extent of the city’s unfunded pension debt in time to help avert the problem.
San Diego city attorney Michael Aguirre announced the settlement yesterday at a press conference, report the American Lawyer and Daily Journal (sub. req.). Orrick is among several law and accounting firms sued for malpractice after providing advice on the city’s bond offerings.
“I brought this lawsuit because I believed Orrick should have discovered the pension problems earlier than it did in September 2003, at which time Orrick advised the city that its financial statements had failed to properly disclose the scope of the shortfall of funds in the pension,” Aguirre said.
Orrick admitted no wrongdoing in the settlement, and the city has included the law firm on a list of potential bond counsel for future offerings. Orrick spokesman Allan Whitescarver said the firm settled on the advice of its insurance company, which will cover the entire settlement.
“We are proud of the work we performed for the city of San Diego,” he told the Daily Journal.
Other law firms sued by the city are Vinson & Elkins and Willkie, Farr & Gallagher. V&E settled with the city for $4.35 million in June, while the case against Willkie is pending. V&E, which had been hired to investigate the city’s disclosure practices, also did not admit wrongdoing.
