ILLINOIS POLLUTION CONTROL BOARD
April 7, 2005
PEOPLE OF THE STATE OF ILLINOIS,
Complainant,
v.
SKOKIE VALLEY ASPHALT, CO., INC.,
EDWIN L. FREDERICK, JR., individually
and as owner and president of SKOKIE
VALLEY ASPHALT, CO., INC., and
RICHARD J. FREDERICK, individually and
as owner and vice president of SKOKIE
VALLEY ASPHALT, CO., INC.,
Respondents.
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PCB 96-98
(Enforcement – Water)
ORDER OF THE BOARD (by T.E. Johnson):
This matter is before the Board on a number of motions filed by the People of the State of
Illinois (People) and the Skokie Valley Asphalt Co., Inc., Edwin L. Frederick, Jr., and Richard J.
Frederick (respondents). The motions all relate to the issue of attorney fees and costs. For the
reasons explained more fully below, the Board grants the respondents’ motion for extension of
time to allow for limited discovery, and sends this matter to hearing limited solely to the issue of
attorney fees and costs.
PROCEDURAL BACKGROUND
On September 2, 2004, the Board issued an order in this matter finding that the
respondents violated the Environmental Protection Act (Act) (415 ILCS 5 (2002)) and Board
regulations. The Board ordered the respondents to pay a civil penalty of $153,000, but withheld
a decision regarding attorney fees and costs until the matter was fully addressed by the parties.
People v. Skokie Valley Asphalt, Co., PCB 96-98, slip op. at 1 (Sept. 2, 2004). On
September 28, 2004, the respondents filed a motion to stay or extend the time to respond to the
People’s petition for attorney’s fees and costs. Also on September 28, 2004, the respondents
filed a petition to review the Board order with the State of Illinois’ Second District Appellate
Court.
See
Skokie Valley Asphalt v. PCB, No. 04-0977 (2nd Dist. 2004).
On October 18, 2004, the Board issued an order finding that the Board no longer had
jurisdiction of the case in light of the pending appeal and could not, therefore, rule on the petition
seeking attorney fees and the accompanying issues. People v. Skokie Valley Asphalt, Co., PCB
96-98, slip op. at 2 (Oct. 18, 2004). On November 18, 2004, the appellate court dismissed the
respondents’ petition for review.
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On November 19, 2004, the People filed a motion to void the Board’s October 21, 2004
order. On December 1, 2004, the respondents filed a response to the People’s motion, a motion
to renew their motion to stay or extend time to respond to the petition for attorney’s fees and
costs, as well as a motion to stay payment of penalty. On December 8, 2004, the People filed a
response to the respondents’ motions. On December 16, 2004, the Board issued an order giving
respondents until January 13, 2005, to respond to the People’s request for attorney fees and costs.
People v. Skokie Valley Asphalt, Co., PCB 96-98, slip op. at 3 (Dec. 16, 2004). In that order,
the Board stated that it will not hold any hearings on the issues of fees and costs, and also
continued the stay of the $153,000 civil penalty.
On January 10, 2005, the respondents filed a motion to establish discovery schedule and
for extension of time to respond under the Board order of December 16, 2005. On January 18,
2005, the People filed objections to the motion to establish a discovery schedule and the motion
for extension of time to respond. On February 15, 2005, the respondents filed a motion to
compel response to discovery. Finally, on March 1, 2005, the People filed a response to the
motion to compel.
Currently pending before the Board are the People’s request for attorney fees and costs,
the respondents’ motion for extension of time to respond and to establish a discovery schedule
the respondents’ motion to compel.
THE FEE REQUEST
In their petition for attorney fees and costs, the People request attorney fees in the amount
of $134,250 and costs in the amount of $3,482.84. The People attached affidavits itemizing the
time spent and work performed by Assistant Attorney Generals (AAG) Cohen, Sternstein, and
Murphy. The suggested hourly rate is $150 per hour.
MOTIONS
Respondents’ Arguments
In the motion for extension of time and to establish a discovery schedule, the respondents
assert that in its December 16, 2004 order, the Board implicitly ruled that the respondents are
entitled to discovery with respect to the issues of the request for attorney fees and costs. Mot1 at
2. The respondents contend that the Board failed to establish a schedule for discovery when it
set the deadline of January 13, 2005, for the respondents to respond to the request for attorney
fees and costs.
Id
. The respondents argue that they have sent discovery regarding attorney fees
and costs to the People that is not due until after the January 13, 2005 deadline for the
respondents to respond.
Id
. The respondents contend that the information sought by the
discovery is necessary and that the January 13, 2005 deadline needs to be extended so the
respondents can have sufficient time to analyze the discovery material and prepare their
response. Mot1 at 3. The respondents assert that the People’s affidavits are without basis in the
hearing record and are based on facts unsupported by sufficient documentation and most likely
have been fabricated solely for the purposes of the claim. Mot1 at 3.
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The respondents contend that the payment of attorney fees as set forth in the petition
would result in an unjustified windfall for the People. Mot1 at 4. The respondents argue that it
is hard to justify a claim for fees and costs that is approximately ten times the amount the three
respondents combined paid to defend themselves in this matter.
Id
. In their September 28, 2004,
response to the petition, the respondents contend that by failing to petition for fees and costs at
hearing or in closing briefs, the People have waived their right to such fees and costs and that
any petition at this time should be denied by the Board. Resp. at 3.
People’s Arguments
In response, the People assert that the Board gave the respondents an additional 28 days,
until January 13, 2005, to file any additional response to the petition for attorney fees and costs,
but that the respondents chose not to supplement their initial response. Resp1 at 3. The People
contend that it has already submitted its evidence for costs and fees and that there is no need for
respondents to do any discovery. Resp1 at 4. The People argue that the Board has already ruled
that there will not be a hearing on the costs and fees issue.
Id
.
The People assert that the Board’s order did not contemplate any discovery given the fact
that respondents’ additional time to respond was limited to 28 days and that discovery responses
are, under the rules, not due before 28 days. Resp1 at 4-5. The People argue that there is no
need for discovery and to conduct any at this point in the litigation would cause unnecessary
delay in the Board’s issuing its final order and needlessly increase the cost of litigation. Resp1 at
5.
DISCUSSION
After reviewing the parties’ arguments, the Board finds it appropriate to reconsider and
modify its December 16, 2004 order. Among other things, the respondents have alleged that the
People’s affidavits contain fabrications, and otherwise dispute both the pay rate and the number
of hours contained in the People’s petition. The Board cannot make a determination on these
claims based on the current record.
Thus, the Board will reconsider the December 16, 2005 order stating that no hearings on
the issue of attorney fees and costs will be held. In issuing the December 16, 2004 order, the
Board did not implicitly rule that the respondents are entitled to discovery with respect to the
issues of the request for attorney fees. But, in order to fully consider these allegations, the Board
will grant the respondents additional time in order to conduct discovery and participate in a
hearing regarding attorney fees and costs. Both the discovery and the hearing must be limited to
the issues regarding the reasonableness of the People’s attorney fees and costs.
In determining this reasonableness, the Board will be guided by the factors set out in
long-established precedent. The Board will consider, among other factors, the nature of the
cause and the novelty and difficulty of the questions at issue, the amount and importance of the
subject matter, the degree of responsibility involved in the management of the cause, the time
and labor required, the usual and customary charge in the community, and the benefits resulting
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to the client.
See, e.g.,
George v. Chicago Transit Authority, 107 Ill. App. 3d 784, 438 N.E.2d
498 (1st Dist. 1982); Neville v. Davinroy (1976) 41 Ill. App. 3d 706, 711, 355 N.E.2d 86, 90.
The content of respondents’ discovery requests on this issue have not been filed with the
Board, so that the Board today does not comment on the relevance or the propriety of the specific
language of the requests. Respondent is directed to file the outstanding discovery requests with
the Board on or before April 25, 2005; the People’s response must be filed on respondents and
served with the Board on or before May 25, 2005.
To further focus the discovery process, however, the Board will address the merits of one
of respondents’ specific objections to the fee request. As previously stated, the People request
attorney fees in the amount of $134,250 and costs in the amount of $3,482.84, for time spent and
work performed by AAGs Cohen, Sternstein and Murphy. The respondents have raised
arguments concerning the fees for AAG Sternstein.
On October 16, 2003, the Board issued an order that disqualified AAG Sternstein from
appearing in this proceeding.
See
People v. Skokie Valley, PCB 96-98, slip op. at 5, (Oct. 16,
2003). In that order, the Board stated that while no prejudice or bias resulted from AAG
Sternstein’s prior Board employment, such employment did constitute personal and substantial
participation under 35 Ill. Adm. Code 101.112(b). Because he did not request and receive
consent from the applicable parties after disclosure of the participation, AAG Sternstein was
disqualified from representing the People in this matter. In light of AAG Sternstein’s
disqualification, the Board will not award attorney fees for the time he spent working on this
case. Although no prejudice resulted from AAG Sternstein’s prior employment, the Board finds
that awarding attorney fees for any of the work he did in a matter he was barred from
participating in would not be appropriate. Accordingly, the parties are not to address this issue in
conducting discovery or at the hearing.
Finally, this matter has been pending before the Board for approximately eight years.
Any pleading by either party not designed to further a speedy and ultimate resolution of this case
will not be tolerated by the hearing officer or the Board.
CONCLUSION
The Board grants respondents’ motions for extension of time and authorizes respondents
to conduct discovery on the attorney fee issue. Respondents’ are directed to file the discovery
requests with the Board on or before April 25, 2005; the People’s response must be filed on
respondents and served with the Board on or before May 25, 2005. The stay of the $153,000
civil penalty imposed in the Board’s September 2, 2004 order remains in effect. The hearing
officer is directed to proceed to hearing as outlined in this order as expeditiously as possible.
IT IS SO ORDERED.
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I, Dorothy M. Gunn, Clerk of the Illinois Pollution Control Board, certify that the Board
adopted the above order on April 7, 2005, by a vote of 4-0.
Dorothy M. Gunn, Clerk
Illinois Pollution Control Board
