HomeMy WebLinkAboutContracts & Agreements_189A-2013_CCv0001.pdf LITIGATION ENGAGEMENT AGREEMENT
THIS LITIGATION ENGAGEMENT AGREEMENT(this'Agreement'),dated September 6,2013 is by and
between KNOBBE,MARTENS,OLSON&BEAR, LLP,a California limited liability partnership("we,""us°or the"Firm"),and
the client(s)identified below("you"):
Client(s): City of Redlands
Type of entity and state of incorporation or formation:
Case(s)/Matter(s) Geomembrane Technologies,Inc.v.R.P.S.Engineering Corp.,Doty Bros Equipment Co.,
URS Corporation,URS Group, Inc.,City of Redlands
Case Nos. EDCV13-01307 RGK(SP) Our File Nos.
We are pleased that you have requested that we represent you with respect to the above-referenced litigation matter(s)
(the`Litigation'). For your information, the Firm is a limited liability partnership formed pursuant to the California Corporations
and Business&Professions Codes. This Agreement sets forth the terms of our engagement,including financial terms and how
we will address conflicts of interest. Specifically,you and we agree as follows:
I. THE SCOPE OF OUR ENGAGEMENT
A. Representation Limited to the Litioation
We will be representing you only with respect to the Litigation and in no other matters unless specifically agreed to in a
written agreement signed by you and us. Daniel McHugh, City Attorney, has the authority to delegate the Litigation to us, and
we will direct communications solely to that person, unless you tell us otherwise in writing.
B. Our Le al Advice
While we will endeavor to provide you with sound legal advice,it is very difficult to predict the outcome of legal matters,
particularly litigation matters. Therefore, nothing in this Agreement or in our communications with you will constitute a promise
or guarantee as to the outcome of the Litigation,but only expressions of our professional judgment.
You understand that we cannot and do not guarantee an ultimate victory or favorable settlement, but only that we will
use our best judgment at the time and that we will vigorously represent you. Similarly,if, in connection with or in preparation for
the Litigation,we advise you with regard to the validity, scope or infringement of intellectual property rights, our advice is not a
prediction; it is only our judgment as to likely consequences.
C. Insurance Coveraae for Our Lepaf Fees and Costs
You promptly and carefully will review all insurance coverage that you may have to determine whether a
portion of our legal fees may be reimbursable to you by your insurance carrier. If your insurance coverage does apply,
you would remain responsible for timely payment of all invoices in accordance with the terms provided herein, but we
will accept payments directly from your insurance carrier and you consent thereto. You would be responsible for
payment of any difference between insurance payments and our invoices. Because we are not insurance coverage
specialists,you should obtain legal advice from an insurance attorney with respect to insurance coverage, so that a
prompt tender of any claims can be made to any potential insurance carrier.
D. Termination of Relationship
The attorney-client relationship is one of mutual trust,confidence and respect. Thus,you retain the right to discharge
us as your counsel at any time for any reason. Likewise, we retain the right to cease representing you (except to the extent
limited by applicable law or rules of professional conduct), at any time for any reason, after giving you reasonable notice of our
decision to withdraw. Further,your failure to pay our invoices within sixty(60)days of receipt may result in our withdrawal from
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this representation. You will sign all paperwork necessary to effect our withdrawal from the Litigation,which may be required by
the courtlforum in which the Litigation is pending.
Following termination of our engagement or conclusion of the Litigation,upon your written request,we will return to you
your papers and property in our possession,provided that(i)we receive your written request within two months after termination
of our engagement and (ii) we retain our files, including lawyer work product, pertaining to the work performed. In order to
minimize unnecessary storage expenses,we reserve the right to destroy or otherwise dispose of any such items retained by us
Within a reasonable period of time after the termination of the Litigation or our engagement unless you have made other
arrangements with us in writing.
When more than six (6) months have elapsed from the last time that you requested, or we furnished, any billable
services for you, and the Litigation is not pending in any court or other forum, our attorney/client relationship will be considered
terminated. You may re-engage us to represent you for any other subsequent litigation or other intellectual property matters,
subject to our conflict clearance and business intake procedures. If the relationship between you and the Firm is terminated for
any reason,and you desire to continue to pursue the Litigation,you promptly will engage new counsel to continue work on the
Litigation, and you will not seek to recover from us any"start-up"costs incurred by the new counsel.
E Resolution of Disputes;Waiver of Jury Trial
You recognize that our legal services relate to litigation involving patents, trademarks, copyrights or other
areas of intellectual property, and that these are matters in which the scope of protection is typically subject to U.S.
federal law, and in which U.S. District Courts typically have jurisdiction. In recognition of those facts, if a dispute
should ever arise over our services (including any related dispute over our fees), such dispute will be tried before a
U.S. District Court judge, sitting without a jury, including any related disputes over our fees. Should a dispute ever
arise(f)over our services in which a U.S. District Court declines jurisdiction,or(ii) solely over our fees, such dispute
will be tried before a California Superior Court judge, sitting without a fury. You also have the right to preliminarily
arbitrate any dispute over our fees before the relevant local bar association in an effort to reach an amicable
resolution. We encourage you to seek the advice of an attorney not associated with the Firm with respect to this
provision and other provisions of this Agreement.
!. Respective Responsibilities ofAttornev and Client
In addition to our other responsibilities set forth in this Agreement,we will keep you reasonably informed of significant
developments in the Litigation and as necessary to perform our services. We will inform you as to our progress and will consult
with you as to issues that arise.
In addition to your other responsibilities set forth in this Agreement,you will be candid and cooperative with us and will
keep us informed with complete and accurate factual information, documents and other communications relevant to the
Litigation or otherwise reasonably requested by us. You also will assist us by making strategic and tactical decisions
appropriate to enable us to represent you competently with respect to the Litigation. If we advise you to take courses of action
that we deem necessary in connection with the Litigation,and you decline to take those courses of action or do not provide us
with timely instructions as to them, you will assume the risk of not taking such courses of action or, in the alternative, you
authorize us to withdraw as your attorneys. You will inform us, in writing, of any changes in the name, address, telephone
number,contact person, E-mail address,state of incorporation or other relevant changes regarding you or your business. If we
cannot reach you at the latest address provided to us,we cannot properly represent you, and under those circumstances you
hereby authorize us to withdraw as your attorneys.
If you affiliate with, acquire,are acquired by or merge with another company,you will provide us with sufficient notice to
permit us to seek an engagement that is limited in scope or time or to withdraw as your attorneys(and you consent thereto and
consent to pay for all costs associated with transferring your matters to new counsel and all costs of getting such new counsel
up to speed on your matters) if we determine that such affiliation, acquisition or merger creates a conflict of interest between
any of our clients and the other party to such affiliation, acquisition or merger,or if we decide in our sole discretion that it is not
in the best interests of the Firm to continue to represent you in light of your association with the new entity.
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G. Responses to Auditors'Requests for Information
It is our policy to comply strictly with the terms of the ABA Statement of Policy Regarding Lawyers' Responses to
Auditors'Requests for Information (December 1975)in any response that you request we make to your auditors regarding 'loss
contingencies'affecting you.
II. CONFLICTS OF INTEREST
A. Conflicts Policy
Our policy on conflicts may affect your rights. We encourage you to seek the counsel of an attorney not
associated with the Firm with respect to this policy.
Our Firm represents many other companies and individuals. We take numerous steps to search for conflicts between
the work we do for you and our work for other clients. However, these searches are not perfect, and may result in our
unknowing acceptance of work that conflicts with yours. As long as our searches meet the standard of care in our jurisdiction,
you will not hold us liable for a conflict of which none of our partners is actually aware.
If we discover a conflict after work has begun, you will use reasonable efforts to help us resolve the conflict to the
mutual satisfaction of both clients. Reasonable efforts include allowing us to create an ethical or virtual wall between groups of
attorneys in our Firm to protect confidential information of both clients, whenever we determine that such an ethical or virtual
wall will safeguard the confidential information of each client. We might obtain confidential information from another client that
may be of interest to you but that we cannot share with you.
B. Whom We Represent
In connection with the Litigation, we will be representing only you and not your stockholders, subsidiaries, related
companies, parent companies, investors, officers, directors or employees ("Affiliates"). You will not give us confidential
information regarding your Affiliates. We may represent another client in matters(including litigation)adverse to any Affiliate,so
long as we do not use your confidential information, and you hereby waive any conflicts arising from such representation.
Moreover, if you share with any third party, including your Affiliates, advice that we provide to you, and any third party relies on
that advice to their detriment,you will indemnify and defend us with regard to any claim against us for any loss they incur.
Unless we agree otherwise in writing,you may not use our advice to you for the purpose of acquiring financing for or
selling any shares or interest in your business or your intellectual property. If our advice is so used, you will indemnify and
defend us with regard to any claim against us brought by any party who relies on our advice.
III. OUR FINANCIAL ARRANGEMENT WITH YOU
A. Lena/Pees and Costs
Our charges are comprised of professional fees and costs that we pay or incur on your behalf. Professional fees are
charged by attorneys, including partners and associates, and by non-attorney professionals, including paralegals and litigation
clerks. Costs are either amounts invoiced to us from outside vendors or professionals or reasonable allocations of our internal
costs attributable to the use of our facilities and personnel. Costs may include filing fees, court fees, investigation fees, court
reporter/video fees and deposition transcripts, outgoing faxes, photocopies, postage, messenger or courier fees, computer
research time, prior art searches,reasonable and customary travel expenses,etc. It is our practice to request that experts and
consultants hired on your behalf bill you directly. Whenever we request in writing,you will be responsible for the payment of
certain other significant fees and expenses charged by outside vendors in connection with the Litigation, and you will make
payment directly to such vendors upon receipt of an invoice.
Our professional fees are based on the amount of time we spend attending to your legal matters. Our fees in
connection with litigation are calculated at the regular hourly billing rate of the person performing the work. The hourly rate of
each person is determined by his/her experience. Our hourly rates are subject to change without notice, but are usually
adjusted once per year, If we ever produce records or testify under subpoena with regard to your representation, you will
compensate us at our normal billing rates for our costs and the time required to prepare for and provide such testimony or
records (including the cost of counsel to defend any depositions). Subject to your instructions, the responsible partner will
determine the overall strategy for the Litigation, and then closely supervise another professional (such as an associate or non-
attorney professional)in the implementation of that strategy. More than one attorney will be assigned to your case so that those
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tasks requiring a higher level of expertise will be performed by a more experienced attorney, and those tasks requiring less
expertise will be performed by an attorney at a lower billing rate in order to provide you with a cost-effective,yet high quality,
work product. The following individuals will most likely be responsible for the majority of the projects relating to this case:
Partner(s) Mike Trenholm $555 (hour
Paul Stewart $625 (hour
Associate(s) Kenneth R. Nielsen $430 /hour
$* /hour
Non-Attorney Professional(s) To be determined $* /hour
As needed, however,other attorneys and non-attorney professionals in the Firm may be involved in the Litigation. Our
personnel may confer among themselves about the Litigation in order to permit the Litigation to be efficiently handled at the
lowest possible billing rates. Because of unpredictable circumstances and complications, it is difficult to estimate the cost of
litigation. However,whenever requested,we will do our best to provide you with an estimate of our fees and costs. Please note
that the amount of our fees can vary from month to month depending on the stage of the case and the level at which you or any
other party elects to litigate the case, and that fees increase substantially in the months prior to trial. At the conclusion of the
case,we may be required to close our files in the manner imposed by the court's protective order. We will invoice you for our
fees and costs in doing so.
California Business and Professions Code Section 6148 requires that, under certain circumstances, attorney invoices
contain a specified level of detail as to fees and costs. To the extent(if any) that Section 6148 applies to this engagement,you
knowingly waive any further detail concerning specific fees or charges. You,of course, may request it at any time, and we will
provide to you,additional detail as to particular charges and attorney and staff rates applicable to this engagement.
B. Retainers and Invoices
It is our standard practice to request an advance payment or"retainer" when initiating representation of a client in a
litigation matter. The retainer will be placed in an interest-bearing trust fund account and retained as a security deposit against
final payment. Initially, no retainer will be required in this case. As the case approaches trial, we may request a retainer to
cover the trial expenses in an amount to be determined. If there is a balance in the retainer amount at the conclusion of the
Litigation, we will return the balance to you,with interest, except that if you have any past-due accounts for other matters, you
hereby authorize us to apply any balance to those past-due accounts.
Our regular invoices are mailed monthly. Occasionally,when there is an unusually large amount of work performed,
we may issue a special invoice. The purpose of the special invoice is to be sure that you are aware of the large amount
outstanding so that you may budget accordingly and so that we may ensure the cash flow necessary to pay for the staffing and
services required by your matter, All regular invoices are due and payable within thirty (30) days, and all special invoices are
due within ten(10)days, after their receipt,except that you may withhold payment of any questioned amounts until the propriety
of the charge can be reasonably determined. if you do not object to a regular invoice within thirty (30) days, or to a special
invoice within ten (10)days,after receipt,we will assume that you have agreed to the terms of the invoice.
You will pay any charges not in question when they are due,regardless of whether an insurance carrier, or other third
party, has agreed to reimburse you for our fees. Moreover,you may not assign or otherwise transfer your obligation to pay our
fees without our express written approval. On any amounts not paid within thirty (30) days after the date of receipt of the
invoice,a late charge of ten percent(10%)simple interest per annum will be assessed. If your bills remain unpaid beyond sixty
(60) days, and still remain unpaid ten (10)days after you receive written notice from us that we intend to stop work or withdraw
from representing you due to non-payment of your bills, you hereby authorize us to do either or both of the following, at our
option: (i) immediately stop work on all of your matters,even if to do so would cause prejudice to you or any of your rights,or
(ii)withdraw from your representation,at our option,if permitted by applicable law and rules of professional conduct.
C. Security Interest
As security for payment of our professional fees and costs,you hereby grant us a security interest in and lien on (I)
your intellectual property that is or has ever been the subject of our representation and all files and records relating thereto, (ii)
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any recoveries from the Litigation or any other litigation involving such intellectual property, including, without limitation, any
judgments, amounts paid in settlement, insurance proceeds and any awards of attorneys' fees and costs, and (iii) any other
proceeds of such intellectual property(collectively,the'Collateral"). This Igen attaches on the date that you sign this Agreement.
Further, we may file and/or record any documents that we deem appropriate to evidence and/or perfect such lien at any time
that your account is sixty (60) or more days overdue. Our lien secures the outstanding sums owed to us during and at the
conclusion of the performance of our services. In connection with this lien,you hereby appoint us as your attorneys-in-fact with
full authority to execute, file and/or record any documents necessary to evidence or perfect our lien and to assign the Collateral
to us in the event of default by you. You represent to us that you have not granted any security interest in the Collateral to any
third party. Before signing this Agreement, you should recognize your right to seek independent counsel of your
choice with respect to the granting of a security interest described in this paragraph.
IV. GENERAL PROVISIONS
A. E Mail Notifications
Unless you inform us otherwise in writing,you agree that E-mail is an acceptable means of communicating with you
and we will direct communications to the E-mail address that you have provided. If you wish to encrypt your communications
with us for security reasons, please E-mail us with your request, and we will work with you to establish encrypted
communications. Absent such a request, you agree that there is a reasonable expectation of secrecy in our E-mail
communications to preserve your confidences.
S. Notices;Successors;Entire A-greement,Amendment;Governing Law
All notices must be in writing and must be sent by U.S. registered or certified mail, addressed to the addresses last
provided by the receiving party. This Agreement binds and inures to the benefit of your successors and assigns and the
successors and assigns of our Firm. This Agreement contains the entire agreement between you and our Firm. All preliminary
and contemporaneous communications are superseded by this Agreement. This Agreement may be amended only by a written
agreement signed by both you and a partner of our Firm. This Agreement is governed by, and must be interpreted under,
California law,except that United States federal law will govern (i)Section LE above entitled'Resolution of Disputes;Waiver of
Jury Trial' and (ii) issues related to whether matters are substantially related in the context of a conflict of interest, and except
that the American Bar Association Model Rules of Professional Conduct will govern your informed written consent and waivers
provided in Section ILA above.
C. No Accord and Satisfaction
No statement on a payment check from you or in a letter accompanying a payment check from you is binding on our
Firm and we may negotiate such check without being bound by the conditions of any such statement. If you pay any amount
other than the actual amount due to us, receipt or collection of such partial payment does not constitute an accord and
satisfaction. We may retain any such partial payment,whether restrictively endorsed or otherwise,without prejudice to our right
to collect the balance properly due.
D. Authority;Force Mafeure
If you are an entity, anyone signing this Agreement on your behalf represents and warrants that they are duly
authorized to sign on behalf of and to bind your entity. If we are delayed or prevented from performing any obligation to you by
an event of Force Majeure, our performance of such obligation will be excused for a period equal to (i)the duration of the Force
Majeure event,or(ii) if longer,the period of delay actually caused by the Force Majeure event. For purposes of this Agreement,
"Force Majeure"means a strike,work stoppage,act of war or terrorism,Act of God,fire,earthquake or other natural disaster,or
other occurrence beyond our reasonable control. We will endeavor to provide you with written notice within ten (10) days after
the occurrence of any event of Force Majeure,
E, Severabil
If any provision, requirement or obligation contained in this Agreement is deemed unlawful or unenforceable by any
court,the remainder of the Agreement shall remain in full force and effect, as though the unlawful or unenforceable portion were
removed.
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If you agree to the terms of this Agreement, please sign below and return the duplicate originals to the Firm in care of
the partner signing below. We will counter sign it and send you an original for your records. Before signing this Agreement,you
should recognize your right to seek independent counsel of your choice with respect to the terms of this Agreement, including
the granting of a security interest described above. This Agreement will be effective retroactively to the date we first performed
services for you. The date of this Agreement set forth above is for reference only. We look forward to being of service to you.
KNOBBE,MAR ENS, OLSON&BEAR, LLP ACCEPTED AND AGREED WITH CONSENTS AND
WAIVERS GRANTED
By: CITY OF REDLANDS
Partner's Sign tyre ?k4
Name of Partner: Mike Trenholm By: r
Print Name: Pete Aguilar
Title: Mayor
16088576
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Office of the Daniel J. McHugh
City Attorney
k°nRAI City Attorney dmchu;h@cityofredlands.or7
City of Redlands
MEMORANDUM
TO: SAM IRWIN, CITY CLERK
FROM: HEATHER MCGINNIS, MANAGEMENT ANALYST
DATE: NOVEMBER 21, 2013
RE: LITIGATION ENGAGEMENT AGREEMENT-KNOBBE, MARTENS,
OLSON, & BEAR, LLP
Mr. Irwin: Attached for your records, please find the original Agreement for Special
Counsel Legal Services between the City of Redlands and Knobbe, Martens, Olson, & Bear,
LLP. Should you have any questions regarding this matter, please feel free to contact me. Thank
you.
HEATHER A. MCGINNIS
Attachments (1)
P.O. Box 3005 • Redlands, CA 92373 • (909) 798-7595 • FAX (909) 798-7503
I:\ca\Legal Secretary\Memos\2013\Transmittal Memo to Clerk-Knobbe 11.21.13.doc