Odelson Report Leaked to Patch
Leaked investigative report estimates mishandling of village's legal business may have caused between $8 million to $10 million in economic damages to village.
A copy of the investigative report into the former village attorneys that was reviewed in closed session by the Oak Lawn Village Board last week has been leaked to Patch.
The 38-page report compiled by Odelson and Sterk—with assistance by Trustee Tom Phelan, chair of the village board’s finance committee—provides a deeper look into the practices and billings of Tressler, Soderstrom, Maloney & Priess, and attorney Norman Chimenti.
In his executive summary that was the only part of the report read in open session during the special board meeting on April 18, attorney Burt Odelson said his firm’s findings raised “serious and significant issues” about the Tressler firm and Chimenti’s handling of the village’s legal business. The Tressler firm and Chimenti were hired at the recommendation of Mayor Dave Heilmann.
Odelson was hired in December 2009 to look into possible overbillings by the Tressler firm and Chimenti, after Village Manager Larry Deetjen and other village board members expressed concern when the village’s legal fees tripled over a four-year period.
According to the report, there were attempts to hide legal billings from village officials, cover-ups of legal blunders, miscommunications and end runs around the village manager and trustees by the mayor. These claims are illustrated by excerpts from email correspondence, executive session minutes and a timeline of such major litigation as the Januszewski sexual harassment and Kmart lawsuits.
The Odelson report maintains that village taxpayers paid the tab for more than $3.5 million in legal fees during the four years that Tressler and Chimenti were handling the village’s legal business, between October 2005 and September 2009. Odelson also estimates in his report that the village may have sustained economic damages between $8 million and $10 million.
The “misplaced and ill conceived” cooperative venture put into place in October 2005 that dramatically changed the village’s legal strategy when the Tressler firm was hired as village attorney with Chimenti—a friend of Heilmann’s from community theater productions—as the “overseer” or “gatekeeper” of the village attorneys. Chimenti is said to have accepted the role of overseer after he admitted lacking municipal law experience required for the position of village attorney.
Attorney Barry Moss, whose municipal law firm had merged with Tressler, pitched a large monthly retainer of $21,000 during an executive session of the village board in October 2005. In exchange, the firm would take care of all the village’s legal business and ensure a “free flow of information” between the village’s elected officials and staff.
The fixed fee excluded legal work pertaining to municipal bond sales and other ongoing litigation. Prior to the hiring of Tressler and Chimenti, the village’s legal business was performed by Klein Thorpe and Jenkins—at a monthly retainer of $3,700, excluding bond and litigation work that was billed separately.
When the deal to hire Tressler and Chimenti was first floated before the village board in October 2005, Heilmann told village trustees of Chimenti’s municipal law experience working for LaGrange Park. That claim was later discovered to be untrue after LaGrange Park officials told Deetjen that they had never heard of Chimenti, according to the report.
The report surmised that Tressler’s mishandling of firefighter Sharon Januszewski’s sexual harassment lawsuit against the village may have cost Oak Lawn taxpayers $1.4 million in estimated economic damages.
Tressler never communicated to the village board that it had low-balled a settlement offer of $50,000 to Januszewski, after the board authorized Tressler to offer up to $200,000.
Further, the report stated that Tressler waited three months to tell the village board of Januszewski’s first settlement demand of $1.1 million in October 2007. During that three-month period, Tressler continued to bill the village approximately $50,000 in legal fees. (Tressler is also said to have waited a month to inform the village board of Januszewski's second settlement demand of $2.5 million in June 2009.)
According to the report, Heilmann also had authorized Tressler to begin litigation against the village’s insurer in November 2007 without bringing it before the board after the insurer had denied the village coverage in the Januszewski lawsuit. Heilmann informed village board members that Tressler lost the litigation “in passing” during an executive session on Jan. 8, 2008.
In an exchange of emails between Heilmann and village finance director Brian Hanigan between July 24 and July 28 of 2008, Heilmann instructed Hanigan to gather the Januszewski legal bills from Tressler and put them on his desk.
“I was told in the spring we were [billed] $270,000 and now I hear $470,000. That doesn’t make sense because not enough activity has taken place. I want to review their invoices,” Heilmann wrote.
“Will do,” Hanigan replied.
Hanigan emailed Heilmann a few days later, asking the mayor if he was “okay” with Deetjen’s decision to hire conflict counsel for the four firefighters named in the Januszewski lawsuit, upon the recommendation of TPA-CCMSI. (Deetjen was not copied on Hanigan’s email, the report noted.)
Heilmann emailed Hanigan back, copying Deetjen on his response: “No, I am not okay with this. All legal retention goes through Norm Chimenti first.”
In another email, Heilmann tells Hanigan to fire the conflict counsel and copies Chimenti, but not Deetjen, the report said.
After a midyear budget report presented by Deetjen to the village board during an executive session meeting in June 2008, Hanigan emailed Heilmann on Aug. 1, 2008, with “June budget” in the subject line:
“I did not elaborate … on the legal bills and settlements, which I obviously want to be extremely careful of. As you know, there are about $200,000 to $250,000 of outstanding legal bills not reflected in the actual village cash flow through the end of June.”
The report noted that “neither Heilmann nor Hanigan ever advised the manager or trustees of these matters and developments.” Because of these actions, the report projects that it possibly cost the village an additional $1 million in legal fees, “which were never provided to the village manager or trustees.”
When Odelson and Sterk requested the legal invoices for the Januszewski lawsuit in spring 2010, "more than $1 million in invoices were excluded from the mix."
Chimenti is also described in the report as being in over his head in municipal law matters, and he admitted in various emails to Heilmann of being unfamiliar with municipal law and finance terminology.
Despite this, Chimenti continued to bill the village for legal fees as co-counsel in union labor contract and grievance hearings brought against the village by the firefighters’ union. According to the report, Chimenti and his firm, Martin Craig, charged the village an $11,000 monthly retainer for his legal services. (Chimenti later tried to reduce the monthly retainer to $6,500 in July 2009, when it became apparent that his legal services were about to be terminated.)
Deetjen, Phelan, former village fire chief Ed Folliard and other village executives are described in the report as being “astounded by Chimenti’s lack of preparedness and poor command of the issues” during firefighter grievance hearings, costing the village between $300,000 and $600,000 in settlements.
As a result of the poor outcome, the report continued, Deetjen and Folliard both requested that Chimenti be replaced by more experienced legal counsel. Chimenti continued to bill the village $118,000 in legal fees for duplicate work, referring to himself as “co-counsel.”
In an exchange of emails with Heilmann in June 2009, Chimenti laments that he feels as if he is competing with the other labor attorney, Karl Ottosen, for “Deetjen’s and Phelan’s affections.”
“It’s a jungle out there, Davey,” Chimenti wrote.
“But I think we can outsmart ’em,” Heilmann responded.
“Without a doubt,” Chimenti said.