1 The Honorable Janet Helson

Noted for Hearing with Oral Argument: February 10, 2017

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IN THE SUPERIOR COURT OF THE STATE OF WASHINGTON
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IN AND FOR KING COUNTY
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CCD BLACK DIAMOND PARTNERS LLC, a No. 16-2-29091-4 KNT
Delaware Limited Liability Company,
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Plaintiff, PLAINTIFFS RESPONSE TO
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MOTION FOR PRELIMINARY
vs. INJUNCTION OF DEFENDANTS
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ERIKA MORGAN, PAT PEPPER
CITY OF BLACK DIAMOND and BLACK AND BRIAN WEBER
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DIAMOND CITY COUNCIL, a Public Agency,
and ERIKA MORGAN, PAT PEPPER AND
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BRIAN WEBER, Black Diamond City Council
Members,
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Defendants.
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I. RELIEF REQUESTED
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Plaintiff asks that the Court deny these Defendants Motion.
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II. ARGUMENT AND AUTHORITY
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Defendants Erika Morgan, Pat Pepper and Brian Weber have filed a motion they
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entitle a Motion for Preliminary Injunction. It is possible it was so titled because
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Motions for Preliminary Injunction are one of the few non-dispositive motions for which
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King County Superior Court Local Rules automatically grant hearings with oral argument
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and these Defendants wanted a live hearing. It is not clear what other basis exists for the
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PLAINTIFFS OPPOSITION TO MOTION P.O. Box 33744

FOR PRELIMINARY INJUNCTION- 1 Seattle, WA 98133
(206) 443-0200
1 naming of the motion, as by its terms it does not seek to enjoin anyone from taking any

2 action but rather tries to force the City of Black Diamond to take an affirmative act. The

3 Motion is not a Motion for a Preliminary Injunction. Rather, it seeks an order from the

4 Court requiring the City, and thus the taxpayers, of Black Diamond, to pay for their legal

5 defense in this matter. This Motion is an inappropriate vehicle to make such a demand,

6 and as explained more fully below, and presumably in any response filed by the City,

7 these Defendants are not entitled to the relief they seek.

8 First, the Black Diamond Municipal Code provision on which they rely, Chapter

9 2.66 (Mot., Attachment A), illustrates that these Defendants have failed to follow the

10 procedures required to request taxpayer-paid counsel and that the Code provision itself

11 affords a basis to deny their request for such payment.

12 Section 2.66.020 requires that the employee or official seeking to be indemnified

13 for the reasonable cost of defense for representation by his or her own attorney must

14 first obtain consent from the city council, by motion, approving the representation by the

15 attorney, other than the city attorney. (Att. A at p. 2).

16 Defendants Morgan, Pepper and Weber claim the City Council approved a

17 resolution to pay for their attorney, but they have not provided proof of the Motion

18 required by Section 2.66.020, nor have they provided proof of approval by the City

19 Council. The resolution (Taraday Decl., Ex. A) shows that the three Defendants were

20 disqualified from participating in a decision to use taxpayer funds for their own benefit.

21 The other two elected Council Members did not vote in favor of this Resolution. And so

22 these Defendants have not shown the necessary triggering event of a motion approved by

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PLAINTIFFS OPPOSITION TO MOTION P.O. Box 33744

FOR PRELIMINARY INJUNCTION- 2 Seattle, WA 98133
(206) 443-0200
1 the non-conflicted members of the Council necessary to even begin the indemnification

2 process.

3 Section 2.66.030.A states:

4 In no event shall protection be offered under this chapter by the city to:

5 1. Any dishonest, fraudulent, criminal willful, intentional or malicious act or

course of conduct of any official or employee;
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2. Any act or course of conduct by an official or employee which is not
7 performed on behalf of the city;

8 3. Any act or course of conduct which is outside the scope of the official or
employees service or employment with the city; and/or
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4. Any lawsuit brought against an official or employee by or on behalf of the
10 city. Nothing in this chapter shall be construed to waive or impair the right of
the city to institute suit or counterclaim against any official or employee not to
11 limit its ability to discipline or terminate an employee.

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(Att. A at p. 2-3). The City has asserted a cross-claim against these defendants, so under
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Section 2.66.030.A.4, indemnification may not be provided. Further, these Defendants
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were warned several times by lawyers hired to advise the City that the actions they were
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taking, and continued to take, were illegal and wrongful and would result in liability for
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them and for the City, and yet these Defendants acts continued. (See Attachments to
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Complaint and the Citys Answer to Complaint.) Thus under Section 2.66.030.A.1 the
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City is authorized to deny indemnification and a tax-payer paid defense.
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Section 2.66.040 states:
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The determination of whether an official or employee shall be afforded a defense
21 for the city under the terms of this chapter shall be finally determined by the city
council on recommendation of the mayor. The decision by the city council shall
22 be final as a legislative determination of the council.

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PLAINTIFFS OPPOSITION TO MOTION P.O. Box 33744

FOR PRELIMINARY INJUNCTION- 3 Seattle, WA 98133
(206) 443-0200
1 The Mayor did not recommend tax-payer paid defense of these individuals, and the non-

2 conflicted Council Members the only ones authorized to vote on the measure did not

3 approve it. The decision of the Council is a final legislative determination of the council

4 which these defendants can take up in a separate lawsuit or in their counter claim, but

5 they cannot merely void that final decision through a hastily-prepared, improperly-

6 characterized motion for preliminary injunction.

7 Further, Section 2.66.030.B states:

8 The provisions of this chapter shall have no force or effect with respect to any
accident, occurrence or circumstance for which the city or the official or
9 employee is insured against loss or damages under the terms of any valid
insurance policy; provided that this chapter shall provide protection, subject to its
10 terms and limitations, above any loss limit of such policy. The provisions of this
chapter are intended to be secondary to any contract or policy of insurance owned
11 or applicable to any official or employee. The city shall have the right to require
an employee to utilize any such policy protection prior to requesting protection
12 afforded by this chapter.

13 (Att. A at p. 3). No evidence has been submitted that these Defendants have submitted

14 this claim to all of the various personal and professional insurance policies they and their

15 families hold to determine if other coverage is available. The submission of the claim to

16 all their various policies is required prior to requesting protection under the Chapter,

17 and evidence of such submission, and any denials, was required with the request.

18 Section 2.66.050 states:

19 The provisions of this chapter shall apply only when the following conditions are met:

20 A. In the event of any incident or course of conduct potentially giving rise to a

claim for damage, or the commencement of a suit, the official or employee
21 involved, as soon as practical, give the city attorney written notice thereof,
identifying the official or employee involved, all information known to the
22 official or employee with respect to the date, rime, place and circumstances
surrounding the incident or conduct giving rise to the claim or lawsuit, as well
23 as the names and addresses of all persona allegedly injured or otherwise
damaged hereby, and the names and addresses of all witnesses.
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PLAINTIFFS OPPOSITION TO MOTION P.O. Box 33744

FOR PRELIMINARY INJUNCTION- 4 Seattle, WA 98133
(206) 443-0200
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2 (Att. A at p. 3). Sections B-D impose other obligations on the official in terms of ongoing

3 cooperation and assistance. (Att. A at pp. 3-4.) These Defendants have offered no evidence that

4 they have complied with the requirements of Section 2.66.050. These terms are a precondition to

5 any coverage under this Chapter. Section 2.66.070 states that anyone who fails or refuses to

6 comply with any of the conditions of Section 2.66.050 or who elects to provide his/her own

7 representation with respect to such claim or litigation, than all of the provisions of this chapter

8 shall be inapplicable, and have no force or effect with respect to any such claim or litigation.

9 (Att. A at pp. 4).

10 The Chapter provides a method to address disputes regarding whether or not the

11 City should have paid for an officials defense. Section 2.66.080 provides that

12 If the city determines that an official or employee does not come within
the provisions of this chapter, and a court of competence jurisdiction later
13 determines that such claim does come within the provisions of this
chapter, then the city shall pay any judgment rendered against the official
14 or employee and reasonable attorney fees incurred in defending the
claims. The city shall pay any attorney fees incurred in obtaining the
15 determination that such claim is covered by the provisions of this chapter.

16 (Att. A at p. 5). The provision illustrates that such a determination is to be made after

17 judgement has been, and if the City is held to have been wrong, then the City can be

18 ordered to reimburse an official, with the City to pay the fees incurred in obtaining the

19 determination that such claim is covered by this Chapter. The Chapter does not

20 authorize, or envision, an attack as is occurring here to the Citys Legislative Authority to

21 determine a particular claim is excluded from the Chapters protection or that the official

22 has not satisfied the requirements to receive such protections.

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PLAINTIFFS OPPOSITION TO MOTION P.O. Box 33744

FOR PRELIMINARY INJUNCTION- 5 Seattle, WA 98133
(206) 443-0200
1 Finally, the blank check, automatic approval of bills these Defendants seek would

2 not be authorized by the Chapter even if the Mayor and non-conflicted Council Members

3 determined coverage was available. First, Section 2.66.020.C (Att. A at p. 2) limits the

4 rate that will be indemnified. It states:

5 in no event shall the officer or employee be indemnified for attorney fees

in excess of the hourly rates established by the citys contract with tis city
6 attorney. The hourly rate of the city attorney, who is on a retainer, shall be
calculated by taking the average number of hours directed toward city
7 work for the last complete fiscal year, dividing that into the total retainer
amount to determine an hourly rate. The officer or employee shall be
8 liable for all hourly rates in excess of the rate for the city attorney.

9 Further, all fees related to the cross-claims against these Defendants would be excluded

10 under Section 2.66.030.A.4. And the Mayor would need to approve all bills to determine

11 if the hours expended and costs incurred were reasonable since the Chapter only allows

12 for payment of reasonable fees and costs. These Defendants cannot lawfully vote to

13 expend taxpayer money to pay their lawyer any more than they can vote to approve their

14 own resolution or motion to obligate the taxpayers to pay their lawyer in this case.

15 Plaintiffs request for relief in this action specifically asks that the Court

16 G, Order that Defendant Council Members Morgan, Weber and Pepper be

personally liable for the penalties awarded in this action and that the City,
17 Council, and taxpayers of Black Diamond not indemnify them or
reimburse them for those penalties;
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and
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I. Order Defendant Council Members Morgan, Weber and Pepper to
20 reimburse the City, Council, and the taxpayers of Black Diamond any fees
or costs paid by the City or Council in connection with this action,
21 whether as a payment to Plaintiff pursuant to RCW 42.30.120(4) or in
defense of Defendant Council Members Morgan, Weber and Pepper;
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PLAINTIFFS OPPOSITION TO MOTION P.O. Box 33744

FOR PRELIMINARY INJUNCTION- 6 Seattle, WA 98133
(206) 443-0200
1 Complaint, Page 31. These Defendants with this Motion are seeking to wrongfully

2 deprive Plaintiff of this requested relief and its day in Court. Plaintiff filed this lawsuit to

3 ensure a well-functioning government, to protect its and other citizens of Black

4 Diamonds taxpayer dollars, and to prevent future harm to the City of Black Diamond at

5 large by rogue Council Members ignoring the law. This Motion seeks to deny the City

6 its right to interpret and enforce its own Municipal Code, and to order the City to issue

7 checks to their own private attorney apparently subject to no restrictions. The City has

8 interpreted its Code to not authorize a tax-payer paid defense in this matter, and that

9 determination should stand. These Defendants have not shown an entitlement under the

10 Code provision upon which they rely. They have failed to establish a right to the relief

11 they seek. Plaintiff and the taxpayers of Black Diamond have a right to have this lawsuit

12 resolved and request the relief Plaintiff has sought, and then, and only then, should these

13 Defendants if they have properly complied with the Chapter, be allowed to seek judicial

14 determination of whether or not the Citys determination was in error.

15 Plaintiff has filed this response because the Motion filed by these Defendants

16 seeks to deprive Plaintiff of the relief it has requested, and seeks to harm the taxpayers of

17 the City including itself. Plaintiff was concerned the City could not speak fully to these

18 interests, and so offered them here for the Courts consideration.

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PLAINTIFFS OPPOSITION TO MOTION P.O. Box 33744

FOR PRELIMINARY INJUNCTION- 7 Seattle, WA 98133
(206) 443-0200
1 III. CONCLUSION

2 For the foregoing reasons, Defendants Motion should be denied.

3 Respectfully submitted this 8th day of February, 2017.

4 ALLIED LAW GROUP LLC

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By:_
6 Michele Earl-Hubbard, WSBA #26454
P.O. Box 33744
7 Seattle, WA 98133
Attorneys for Plaintiff
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I certify that this Memorandum contains
9 1989 words in compliance with the
Local Civil Rules.
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PLAINTIFFS OPPOSITION TO MOTION P.O. Box 33744

FOR PRELIMINARY INJUNCTION- 8 Seattle, WA 98133
(206) 443-0200