Taxpayers Watch (TW) has settled its 2006 lawsuit with the Los Osos Community Services District (LOCSD), removing a key obstacle to resolving the District’s financial woes, presently knotted in bankruptcy.
In addition to Taxpayers Watch and the LOCSD, parties in the suit include TW officers Gordon Hensley and Joyce Albright, the State Water Resources Control Board (SWRCB), American Alternative Insurance Company (AAIC) and law firm Burke, Williams & Sorenson LLP (BWS). The agreement still has to be approved by the bankruptcy court.
The settlement requires former LOCSD attorneys Burke, Williams & Sorenson to drop payment claims and outstanding invoices against the District in bankruptcy court totaling $812,151.52, and for dismissal of any and all claims by TW against individual LOCSD board members and the District in TW’s Measure B suit and in bankruptcy. Taxpayers Watch has also agreed not to file any further complaints against the acquitted board members to the California Fair Political Practices Commission (FPPC).
The agreement calls for no admission of guilt or liability for any claim or cause of action by any party as a result of the Taxpayer Watch suit, and assigns “no validity or invalidity” to any claims filed by any of the parties. Taxpayers Watch filed its initial suit against the LOCSD in October 2005 and filed FPPC complaints against BWS and the individual board members in July 2009.
Julie Tacker, one of the former LOCSD members targeted by TW, believes “none of these (TW) players would have gotten a thing had the matter gone to trial. It was the will of the five Directors being sued as individuals, as well at the currently seated LOCSD Board of Directors and more importantly the insurance company ordered by the court to defend us, to stop the bleeding… To that end, it’s (the suit) over. The debt incurred was the LOCSD’s and it was paid by the LOCSD or discharged to bankruptcy.”
Wrote Taxpayers Watch spokesperson Richard LeGros in part of an comment to The Razor, “The TW settlement is of huge benefit of all Los Osos taxpayers, and helps the LOCSD in balancing its books while reducing the LOCSD debt in the US bankruptcy Court… This is a great day for Los Osos as justice has been served.”
Burke, Williams & Sorenson will also pay TW attorney fees totaling $95,000, according the agreement released to local media by LeGros, one of the three recalled LOCSD board members, and provided to him by current LOCSD attorney Jon Seitz at the April 1 LOCSD meeting.
As a result of the settlement, all parties agree to dismiss any claims and counterclaims, and Taxpayers Watch agrees to waive any damage claims against individual board members Chuck Cesena, Lisa Schicker, Julie Tacker, Steve Senet and John Fouche.
According to the settlement, within 10 days of bankruptcy approval, AAIC will pay $348,150 to the SWRCB and $50,000 to TW attorneys, while BWS will pay $95,000 to TW attorneys. Within five days of monies exchanging hands, all suits and cross-suits will be dismissed.
The agreement copy provided by LeGros had not yet been signed by TW’s attorneys.
Taxpayers Watch, comprised of 2005 recalled former District board members and their supporters, filed suit as an organization, although Hensley and Albright also filed separately.
The agreement is not without its political ironies, since the LOCSD has signed the agreement and current board majority members Marshall Ochylski, Maria Kelly and Joe Sparks were all supported for election by Taxpayers Watch.
Taxpayers Watch had accused BWS of advising LOCSD members – some also former members of the Los Osos Technical Task Force (LOTTF) and Concerned Citizens of Los Osos (CCLO) political groups – to settle suits that TW claimed benefitted BWS and LOCSD board members by, in essence, agreeing to settle with themselves for financial gain. Those TW claims against individual board members were dismissed with prejudice in the settlement, which focuses primarily on BWS and the District.
Added Tacker, “The most important message to those in the public who might want to serve as a public official is that one can serve on a board, act as a board and not be sued individually by a vindictive recalled board majority to take our homes, as they desired. The entire matter has been another example of (five) years of wasted District resources and human energy.”
— Ed Ochs








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