HRT ready to sever ties with Williams Mullen law firm

NORFOLK

Hampton Roads Transit is poised to hire its first in-house attorney and end its decades-long relationship with the Williams Mullen law firm, partly out of frustration over paying millions of dollars for legal advice that some transit board members aren't happy with.

HRT has paid the firm $6.6 million over the past 4-1/2 years for work including light rail, labor union negotiations, lawsuits, accident claims, workers' compensation and general board business.

Board members said they favor the change primarily to save the public agency money. But some members said they were not completely satisfied with the counsel provided.

Williams Mullen and its legal predecessors have represented HRT and its forerunners since 1975.

"I don't think we always received the best legal advice we could have been given," said Suffolk Councilman Curtis Milteer.

Cliff Hayes, a Chesapeake councilman, said: "I'm not confident in any of the old regime of HRT staffers or consultants, including legal."

The agency is defending several lawsuits challenging the way it condemned property for light rail. Property owners say HRT improperly used eminent domain powers. Williams Mullen handled the transactions for HRT.

In addition, Williams Mullen advised HRT it did not have a strong enough case to prosecute a suspected theft of bus fares. Two former employees are now charged with embezzlement.

"I think Williams Mullen is an extremely well respected and capable law firm, and I wouldn't begin to second guess their advice on many different issues," Virginia Beach Councilman Jim Wood said. "I did, however, disagree with them over the prosecution of the theft from the money room."

Wood, who was HRT chairman at the time, brought the case to the Virginia Beach police himself. Still, the agency has "spent a heck of a lot on legal representation," he said. "In-house counsel would be a cost-savings move, and it would make accountability a lot easier," he added.

The HRT board meets today and will consider adopting a bylaw change authorizing the attorney's position.

Philip Shucet, HRT president and CEO, said bringing HRT's routine legal work in house could save hundreds of thousands of dollars a year. He said, though, there would be legal needs - labor union talks, for example - that would require outside help.

"When I look at a five-year picture of our legal expenses and the amount that pertains to more day-to-day business, it's a substantial amount of money, partly because we're procuring it through a law firm as opposed to employing in-house," he said.

Shucet said if the board approves the change, he hopes to have an attorney hired within six months so the agency can start reducing reliance on Williams Mullen. The contract with the law firm would be terminated at the end of the calendar year, he said.

"In all fairness, another part of the reason our expenses are high is that as soon as a question passes someone's desk or head here, we call Williams Mullen and ask for legal advice."

This year, the third in a five-year contract with the firm, the billing rate is $315 an hour for lawyers' time.

Thomas Frantz, president and CEO of Williams Mullen, said the firm was not billing HRT at its full rate because it has a commitment to support transportation in the region.

"I do think getting a general counsel in house is a good idea for a company of its size and the volume of legal matters they have," Frantz said.

He said the criticism of his firm's work is "unfortunate in a couple situations." He added, however, that he cannot comment on ongoing legal or client-privileged matters. Frantz said he hopes the firm will be considered for other HRT legal work.

Of the $6.6 million paid to Williams Mullen since 2007, about $2.2 million was for light rail, mostly relating to real estate. The next-largest sum was $1.9 million, for personal injury and accident cases. Close to $900,000 was for personnel issues, and about $800,000 was spent for staffing commission meetings and administrative issues.

Williams Mullen is based in Richmond and has 12 offices, including locations in Norfolk, Portsmouth and Virginia Beach.

Many other transit agencies have in-house lawyers. Cities with the newest light-rail systems, Charlotte and Phoenix, have in-house legal staff that did most, if not all, of their light-rail legal work. Charlotte has four city attorneys assigned to its transit agency "that work and function as part of our department," said Jean Leier of the Charlotte Area Transit System.

Phoenix, which began light rail two years ago, has one in-house attorney. Since 2002, the agency has spent about $400,000 on outside legal help, said Hillary Foose of Phoenix METRO. Property acquisition for light rail was done by city attorneys, she said.

Raleigh and Richmond, which run bus operations similar to HRT's, each relies on city attorneys for legal work.