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Paint companies ask judge to make state pay

07:44 AM EDT on Saturday, August 16, 2008

By Peter B. Lord

Journal Environment Writer

PROVIDENCE — Three major corporations that won a dramatic state Supreme Court verdict last month, overturning a jury finding that they created a public nuisance by selling lead paints here, returned to court yesterday to convince a judge to force the state to compensate them for some of their costs during the nine-year legal battle.

Specifically, the companies targeted the private Motley Rice law firm, which financed much of the state’s case and stood to earn millions of dollars if the state prevailed.

Judge Michael A. Silverstein also heard arguments on a new issue: Some scholars who were hired to evaluate the state proposal for removing the lead paint in Rhode Island asked whether they could write academic papers on what they learned.

The paint companies argue they can’t. The state says they should.

Silverstein agreed to hear more written arguments during the next few weeks and then rule on the compensation and academic issues.

The state spent nine years suing the paint companies and fought the longest civil jury trial in state history, which concluded with three companies — Sherwin Williams, NL Industries and Millennium Holdings — found to have created a public nuisance.

But now that the Supreme Court ruling has absolved the companies of any liability, they argue that a century of legal authority establishes that the state, like any other litigant, must pay the costs of the winning side.

The companies are not arguing for legal fees — which some estimate would total tens of millions of dollars. But they want to be paid for other costs, such as transcripts, exhibit expense, copying fees and witness fees.

The companies have specified only one area of costs: some $240,000 they spent on examiners reviewing the state’s abatement plan after the jury verdict was reached.

The companies haven’t totaled their other costs. But they submitted documents showing that the state spent nearly $2 million beyond legal fees. The state, for instance, spent $395,356 for transcripts and $721,353 copying documents. It also spent nearly $90,000 on the elaborate video technologies used in the courtroom. Motley Rice paid for most of those costs.

Assistant Attorney General Neil F.X. Kelly argued in court yesterday that there is no precedent in Rhode Island for the state paying court costs and only the General Assembly can waive the state’s sovereign immunity protecting it from such costs.

“It’s important for public officials to work for the public without having to worry about costs being assessed against them,” said Kelly. “The defendants are asking the court to make new law in this case.”

Silverstein, who has presided over the case from the outset, prompted laughter when he responded: “I take it the court is not supposed to make new law.”

Silverstein was referring to the Supreme Court’s conclusion that he went beyond existing nuisance law when he allowed the case to proceed.

“I couldn’t resist,” Silverstein added.

Kelly said the state presented its case in good faith and a jury found against the companies. The lawsuit was designed to get the companies to help clean up their paints, he said, not to harass them.

Laura Ellsworth, representing the companies, insisted that the Supreme Court decision vindicated them. And she cited legal precedents in three other states saying the losing entities have to pay the court costs for the other side.

“There should be some way to ameliorate the harm that accrues to a defendant that goes through many years of litigation and wins,” said Ellsworth. “This is a matter of fairness.”

As for the examiners’ wishes to publish their findings about the case, Silverstein said, “It is clear from a public policy point of view, subject to law, that certainly there would be a benefit to society to make use of this information. But if it’s legally impermissible, these folks want to know.”

On Monday, Attorney General Patrick C. Lynch intends to announce plans to seek requests for proposals to clean up 600 houses in urban areas in Rhode Island, using money from an earlier lead-paint settlement with DuPont.

plord@projo.com

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