Settlement impending in Berkeley co-op lawsuit?

Attorneys in a lawsuit involving a Berkeley senior housing cooperative last week told conflicting stories about efforts to settle the case, ranging from “imminent” to impossible.

In court filings last week, attorneys in two lawsuits involving a Berkeley senior housing cooperative told opposing stories about efforts to settle both cases. Three attorneys claimed that a settlement by the end of May is likely, while a fourth attorney rejected that hope and asked the court to keep the pressure on the litigants to settle the cases or face a mid-May trial.

An optimistic story was told by attorneys for the co-op and and eight individual litigants in a joint statement filed in Alameda County Superior Court on Wednesday. Their statement revealed plans to settle a four-year-old lawsuit and a more recent related lawsuit filed in July.

The statement was filed by Hugh A. Donohoe, representing Berkeley Town House, a sixty-unit co-op apartment building near the U.C. Berkeley campus; David H. Schwartz, representing Jonathan Pool, a member of the co-op; and David L. Jordan, representing seven current and former members of the co-op whom Pool is suing for breach of contract in the July case.

In their joint statement, the attorneys told Judge George C. Hernandez, Jr., that Pool and the co-op “have exchanged several drafts of a settlement agreement and have continued to make progress in reaching a global settlement.” Now, they said, a settlement is “imminent”. According to the statement, Pool made a settlement offer to the co-op on 25 March, expiring on 31 May. The attorneys noted that new directors of the co-op are scheduled to take office on 23 May, and “it is prudent to allow Plaintiff’s current settlement offer to be reviewed by the directors who will have the responsibility of implementing its provisions.”

Donohoe, Schwartz, and Jordan argued that the court should not permit the parties to resume preparations for a trial, because doing so “would shift resources away from settlement efforts to time-consuming and expensive litigation efforts”, cause the parties to take “antagonistic positions”, and undermine the agreement to have the costs of litigation covered by insurance. Moreover, they claimed, the co-op’s members “also have a stake in the outcome of this case as Plaintiff’s claims involve matters of governance. These governance matters are best addressed through negotiation and collaboration between the parties”, giving co-op members “an opportunity to provide their input to any settlement that is reached.”

On the same day, a very different story was told by Fred M. Feller, the attorney representing the same seven defendants in the four-year-old case. Feller’s statement said that these defendants have been waiting for over 3 years for a settlement and are convinced that “only a trial, or the pressure of an imminent trial deadline, will ever force this matter to conclusion”. Therefore, wrote Feller, the court should permit the parties to resume preparation for trial, and the trial, currently set for 13 May, should not be postponed.

The attorneys’ conflicting arguments will be reviewed by Hernandez on Tuesday.

The lawsuit initiated in March 2012 involves claims by Pool of wasted funds, defective construction, earthquake hazards, and violations of co-op members’ rights. In the later suit, Pool claims that the seven defendants entered into a contract to pay the co-op $224,415 and then broke that contract. The latest attempt at settling the cases began in mid-December with the aid of mediator David J. Meadows.

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