01/26/1983 Meeting - Laserfiche WebLink

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e - e Mr. Gleason introduced Tim Sercombe, City Attorneyls Office. Mr. Sercombe said that the resolution before the council had the dual purposes of formalizing the initiation of an an antitrust compliance audit for the City and of setting City policy regarding compliance with Federal antitrust law. He said that recent U.S. Supreme Court decisions indicated that municipalities could be held liable in antitrust suits. He noted that such suits, if successful, could result in award of triple damages plus attorney fees and court costs. He said that the policy proposed by the City Attorneyls Office would intitiate a paper trail, which could be used in defending the City from such suits. He said that the resolution also recommended ordinance changes and changes in City Council procedures. Mr. Sercombe emphasized that this action should be interpreted as an indication that any antitrust liability for the City currently exists but that it would have the effect of removing any grounds for possible future legal actions. Responding to a question from Councilor Holmer, Mr. Sercombe gave examples of recent court cases involving municipal antitrust suits, includin~ one case in which damages of $500 million awarded in in a suit against the Clty of Cape Girardeau, Missouri, would probably bankrupt that city. Mr. Sercombe said that the resolution before the council would have the effect of making certain that the Cityls processes follow the competition policies enshrined by the Sherman Act. He noted that in the past the City had acted by ordinance and required permit to set rates for garbage haulers operating in the City. He said that the City Attorneyls Office had recommended in September 1982 that the City cease enforcement of this practice to avoid any risk potential. He said the City Attorney's Office would be recommending to the council repeal of this ordinance. Councilor Holmer asked if Section 1 of the proposed resolution would serve as a legal defense for the City in an antitrust suit. Mr. Sercombe responded that while this language was not a total legal defense, it was strongly recommended for adoption by corporations and had been given some effect in court cases as removing the element of intent in antitrust violations. Responding to a follow-up question from Councilor Lindberg, Mr. Sercombe said that the proposed resolution would put the City in the most defensible position in terms of current antitrust case law. Mr. Gleason added that the resolution would refine the process and content of the Cityls contract awards. Councilor Hansen and Mayor Keller asked if the City has adequate insurance coverage for antitrust actions. Mr. Sercombe and Mr. Gleason said that this matter would be studied in the antitrust audit. Councilor Lindberg asked if the new Job Partnership Act removed any possible liability to the City for third-party contracts involved in the CETA/Job Training program. Mr. Sercombe cited Article XI, Section 9, of the Oregon constitution and responded that this was a question of State constitutional law. Mr. Gleason said that the principle behind the act is that the Federal government is deregulating this area. He noted that the changes would not take effect until November 1983. He said that the State had not developed a program yet but that it would be possible for the State it indemnify the Private Industry Councils. MINUTES--Eugene City Council January 26, 1983 Page 7