Portsmouth faces hundreds of thousands of dollars in outside legal fees

PORTSMOUTH — City Manager Karen Conard is asking to use $450,000 from surplus funds to pay the legal fees of two outside law firms the city hired.

The city hired the two outside law firms and agreed to pay both their lead attorneys in excess of $600 per hour for their work, according to documents obtained by Seacoast Media Group through a Right to Know request.

The city hired the law firms to help them with two lawsuits they’re facing, including litigation regarding the McIntyre federal building, according to a memo from Conard to the City Council and other city documents.

“The city is involved in two complex litigation matters that are being handled by outside counsel and require additional funds,” Conard said. “These matters are the City v. SoBow Square (the McIntyre litigation in the Superior Court’s Business Court that sits in the Hillsborough Northern District Superior Court in Manchester) and Banfield Road LLC v. the City, et al., (an environmental claim filed against the City and several other parties in Federal Court).”

The council must vote to approve the use of the $450,000 in surplus monies.

Conard told the council that the city hired law firm Hinckley Allen to represent it in the McIntyre-related lawsuit and the McLane law firm to work for the city in the Banfield Road litigation.

“In these two matters, there is no dedicated fund from which to pay the on-going monthly invoices from outside counsel,” Conard said. “Both matters were initiated in the spring of this year, after the budget was published and before the litigation was significantly underway.”

“It would have been difficult to anticipate the on-going legal expenses associated with these matters at the time the budget was passed,” Conard added.

She is asking for the $450,000 to pay the legal fees after “our outside counsel has provided us with an educated approximation of their anticipated fees for the remainder of this fiscal year,” she told the council.

McLane Middleton’s fees

Attorney Mark Rouvalis of McLane Middleton states in an April 6, 2023 letter to City Attorney Susan Morrell that the document “sets forth the terms of my firm’s engagement by the city of Portsmouth” in the Banfield Road litigation.

He states he is a partner in the firm’s litigation department “and will have primary responsibility for your representation.”

“I may use other attorneys and legal assistants in the office in the best exercise of our professional judgment,” Rouvalis said.

“My rate is $615 per hour. I have asked my associate Jesse O’Neil and my paralegal Mary Jo Herman, to assist on this matter,” he said. “Their current rates are $375 and $230 respectively.”

He explained the hourly rates are “based on years of experience and expertise required.”

Regarding the Banfield Road litigation, he said the lawsuit “arises out of (the) alleged disposal of solid and hazardous waste from urban redevelopment projects some decades ago.”

Hinckley Allen’s fees

The city hired law firm Hinckley Allen in April 2020 to represent it in a lawsuit brought at the time by Sobow Square LLC against the city.

The LLC was more commonly known to city residents as Redgate/Kane and served as the city’s private development partners in Portsmouth’s efforts to redevelop the McIntyre federal building property.

Several editions of the City Council tried for the past eight years to secure the McIntyre property through the National Park Service's Historic Monument Program.

GSA dropped Portsmouth from that program earlier this year when the city and Redgate/Kane couldn’t agree on a redevelopment plan, and they ended up suing each other.

Hinckley Allen began representing the city in April 2020 when Redgate/Kane filed an initial lawsuit against the city.

Attorney Michael Connolly of the firm stated in his April 2020 letter to then City Attorney Robert Sullivan that he would be the “attorney primarily responsible for handling this litigation matter.”

“My billing rate is $675 per hour,” he said in the letter obtained through the Right to Know request.

He added that at times he would “use associates whenever advisable.”

His associates, Owen Graham makes $370 an hour, Julianna Malogolowkin makes $400 per hour and Alexa Millinger makes $425 an hour, he said.

That lawsuit was settled in April 2022 after the City Council agreed to pay Redgate/Kane a total of $2 million in exchange for dropping the lawsuit.

Portsmouth has its own legal staff

The city hired the outside law firms despite having an experienced group of attorneys on staff.

They include City Attorney Morrell, Sullivan (who now works part-time), Deputy City Manager and regulatory counsel Suzanne Woodland, Senior Assistant City Attorney Jane Ferrini and Deputy City Attorney Trevor McCourt.

Conard is scheduled to ask the council at their Monday meeting to schedule a public hearing “on the proposed supplemental appropriation from Unassigned Fund Balance of $450,000 for Outside Counsel Legal Fees at the December 18, 2023 City Council meeting,” according to her memo.

Monday’s meeting is scheduled to start at 7 p.m. and will be held in City Council chambers.

This article originally appeared on Portsmouth Herald: Portsmouth NH faces big legal fees for McIntyre