November 12, 2011, 02:52 AM By Michelle Durand Daily Journal Staff
A dozen San Mateo County school districts do not have the authority
to sue the county and its former treasurer for a collective $20 million
loss caused when the Lehman Brothers bankruptcy leeched at least five
times that amount from the county investment pool, according to a San
Francisco Superior Court judge.
Judge Richard Kramer on Thursday affirmed an earlier tentative
ruling that San Mateo County and former treasurer-tax collector Lee
Buffington are immune from civil suits. The ruling essentially dismisses
the case but the districts plan to appeal.
Even so, Michael Celio, attorney for the county and Buffington, said Kramer’s ruling is a victory.
“We are very pleased with this development and that this is over in one form,” Celio said. “This is one large step.”
County officials are deferring any comment on the ruling to Celio, said spokesman Marshall Wilson.
Farley Neuman, attorney for the districts, said he respectfully
disagrees with the ruling and is optimistic the districts will prevail
on the appellate level.
“We don’t think this is consistent with case law. I don’t think
it makes any sense,” Neuman said. “And on top of this they were getting
paid to collect and manage this money they lost.”
Celio said an appeal was always expected and the dismissal saves
time and money because a trial is not first needed on the merits.
Instead, the case heads straight to the higher court for a decision on
the standing. If Neuman prevails, the case will return to San Francisco
Superior Court for trial.
“It is definitely an advantage,” Celio said. “We’re pleased that our legal theories were right and we’re happy to move on.”
In January, the districts and the superintendent of county
schools sued the county and Buffington for $20 million plus interest.
The suit argued the county and Buffington should have pulled investment
pool funds prior to the Sept. 15, 2008 collapse of Lehman Brothers. The
pool lost approximately $155 million from its collection of cities,
agencies and districts.
The county has 24 public school districts of which 12 are named
in the claim along with the San Mateo County Superintendent of Schools:
the San Mateo Union High School District, Menlo Park City Elementary
School District, Belmont-Redwood Shores Elementary School District,
Cabrillo Unified School District, Burlingame Elementary School District,
Ravenswood City Elementary School District, San Bruno Park Elementary
School District, San Carlos Elementary School District, Las Lomitas
Elementary School District, Portola Valley Elementary School District
and Woodside Elementary School District.
The San Mateo County Community College District also lost an estimated $25 million itself but did not join the suit.
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Submitted by Jim Alex
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1 comment:
Just because it was a win does not mean you will get a dime. Good luck, anyways.
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