REPORT TO COUNCIL
SUBJECT
Title
Report from the City Attorney on California Voter Rights Act (CVRA) Litigation
Report
BACKGROUND
The Council has requested a report on the City’s expenditures with respect to defending the Yumori-Kaku v. City of Santa Clara litigation (CVRA litigation). Because the reasonableness of the expenditures cannot be assessed without a completely transparent disclosure of the events that occurred throughout the litigation, I have attached to this report a Chronology of the key dates that are tied to the expenditures of the City and of the plaintiffs, respectively.
In order to draw conclusions about when litigation costs could have been avoided in the course of a lawsuit, it is critical to understand the difference between lawsuits in which the City is a defendant and lawsuits in which the City is the plaintiff.
Most of the time that the City becomes a party to litigation, it is the result of another party filing a complaint against the City as a defendant. When this happens, the City cannot terminate the litigation unilaterally. It must either participate in the litigation through trial in an effort to obtain a verdict in its favor, or convince the plaintiffs to settle the case and dismiss the complaint against the City.
When the City takes the very rare step of suing another entity or person, it serves and files a complaint on a defendant. In such cases, the City can unilaterally terminate such litigations by simply filing a dismissal of the complaint. Usually, this step will only occur if there is some type of settlement with the defendant. This was not the case in the CVRA litigation. Therefore, once the plaintiffs sued the City, the City was not in control of terminating the litigation.
The CVRA was a lawsuit that was brought against the City as defendant. Thus, the plaintiffs had the upper hand as to when and how the litigation could be terminated. As will be explained in detail in this report, until February 2021 the CVRA plaintiffs never offered to dismiss their case or otherwise enter into a settlement that was acceptable to the City Council. Thus, despite two separate ballot measures proposed by the two Charter Review Committees to end the at-large by-seat voting system, plaintiffs opposed these solutions to end the litigation.
DISCUSSION
The City of Santa Clara has been addressing the issue of changing the way it elects its Council members since as early as 2011 when it first received a letter from Robert Rubin, one of two lawyers in California who has extensively threatened litigation under the provisions of the California Voter Rights Act (CVRA). Attached to this report is a Chronology of the events regarding the City’s efforts.
In reaction to the receipt of Mr. Rubin’s 2011 letter, the Council empaneled the first of what would grow to be four Charter Review Committees to conduct a public process to consider ballot measures to amend the City Charter. Although there was sentiment to move away from the numbered seat system in the City Charter and explore a ranked-choice voting system, the 2011 Charter Review Committee ultimately did not propose charter amendment to put on the 2012 ballot.
The next consideration of changing the City Charter began in October of 2015 when, after a recommendation from the Ethics Committee, the City Council convened another Charter Review Committee to consider amendments. The 2015 Charter Review Committee recommended 4 charter amendments all of which passed, but did not recommend an amendment to change the City’s system for electing council members. It is unclear what the impetus for the creation of this Committee was because there is no record of a letter from Mr. Rubin until October of 2016, just before the November 2016 election.
After the election, which failed to elect Asian American candidates in city-wide elections, Mr. Rubin inexplicably withdrew his threat to sue to prevent the seating of the white candidates who had opposed the minority candidates that lost.
The next Charter Review Committee to take on conducting a public process to consider amendments to the City Charter was created by the City Council on April 11, 2017.
The 2017 Charter Review Committee consider several different possible charter amendments. There was virtually no public input indicating a desire to keep the at-large by-seat election process. In a unanimous recommendation, the Charter Review Committee unanimously recommended Measure A which the City Council unanimously approved putting on the June 2018 ballot. Measure A would have created two council districts represented by 3 council members each to be elected using a ranked-choice system of voting.
In October 2017, Mr. Rubin sent another letter to the City Council demanding that City Council members be elected by a district system rather than the at-large system in the City Charter. Despite the fact that there was a clear indication that Santa Clarans were interested in moving away from the current numbered-seat city-wide Charter provisions for electing its council, in December 2017 Mr. Rubin, GDBH and the Asian Law Alliance filed a complaint against the City of Santa Clara demanding a judicial change to the City’s at large election system and seeking attorney fees under the CVRA. The judge in the CVRA case, Superior Court Judge Thomas Kuhnle, bifurcated the litigation into two phases. The first phase was to determine liability, i.e. whether the City’s at-large Charter provisions denied protected classes of voters of Asian ancestry from electing representatives of their choice. The liability phase of the trial proceeded in parallel with the campaign period for the June 5, 2018 election at which Measure A was on the ballot.
It was believed that if Measure A would have passed, there was a substantial possibility that Judge Kuhnle would decide that the CVRA lawsuit was moot because the charter provision at issue in the case would no longer be in effect. Indeed, Judge Kuhnle held off on finalizing his Statement of Decision on the liability phase of the trial until June 6, 2018, the day after the election on Measure A. It also appeared that plaintiffs also believed that the passage of Measure A would have ended their lawsuit because during the campaign, their representatives reportedly urged a “no” vote “so that they would win the lawsuit.”
During the motions regarding the award of attorneys’ fees for the case, it was revealed that plaintiffs’ law firm expended approximately $50,000 in unreported campaign in-kind services against the passage of Measure A. If the judge had declared the plaintiffs’ case moot by reason of the charter having been amended, the litigation would have ended, limiting both the City’s costs, as well as creating the very real possibility that the City would have not be obligated to pay plaintiffs’ fees and costs. In this case, the City’s costs might have been limited to the $500K to 700K range.
After receiving the election results indicating that Measure A had not passed, the CVRA litigation proceeded to the “remedies” phase. Judge Kuhnle ordered the City to engage in a “districting” process that involved a series of public hearings that paralleled the provisions of the state Elections Code. Recognizing that there would not be sufficient time to adhere to the strict provisions of the Code, the judge’s order imposed a series of public hearings on a very tight time frame in July 2018 in order to have an order mandating district elections in time for the November 2018 election.
In compliance with the judge’s order the City Council convened a districting committee to draw up alternative maps for the judge to consider in creating a by-district voting system. Ultimately the court ordered the City to adopt the six-district map that the districting committee had recommended, and the 2018 and 2020 elections were held using this map.
On August 15, 2018, the City filed an appeal of Judge Kuhnle’s decision.
The Council also placed Measure N on the November 2018 elections. Measure N was an advisory measure that asked the voters the following question:
Shall the City of Santa Clara engage the voters in a public process to draft a Charter Amendment ballot measure to elect its Council Members, other than the Mayor, by district?
Measure N received a 70% yes vote. In response to the voters’ approval of Measure N, the City Council convened a Charter Review Committee to conduct robust public outreach to determine what type of district election system should be proposed for a Charter Amendment. The Charter Review Committee recommended that the Charter be amended to proceed with the six-district system for the 2020 election, but then transition to a three-district system with two council members to represent each district to be elected at alternating elections.
In January 2019 plaintiffs moved for an award of their fees and costs as prevailing parties in the litigation. The City moved to reduce their requested award of $4.1 million. The City’s outside counsel spent approximately $163K in successfully reducing the amount of the fees to $3,164,955.61, producing a net savings of $1,073,100.14.
Following the filing of the appeal, plaintiffs moved for a calendar preference in the Court of Appeal which issued an order stating the it would decide the case by March 10, 2020.
It was believed that if Measure C had passed, it would have rendered the appeal moot, ending the litigation. On February 1, 2019, Richard Konda sent a letter to the 49ers asking them to fund a campaign against Measure C. A copy of Mr. Konda’s letter is attached to this report. Ultimately, Jed York spent almost $700K to defeat Measure C, which would prevent the possibility of the Court of Appeal dismissing the case on the grounds of mootness. A dismissal of the case on the ground of mootness could have resulted in limiting the City’s expenses to its own outside counsel expenses, as well as gaining substantial leverage in settling with the plaintiffs on the question of paying their costs.
Although the Court of Appeal had issued an order that it would rule on the appeal by March 10, 2020, it was not until November 2020 that it set December 17, 2020 as the date for oral argument.
The November 2020 election was held in accordance with the trial court order with four council members elected from districts under the court-ordered map.
The Court of Appeal held oral argument in the case on December 17, 2020 and issued its ruling on December 30, 2020. The Court upheld the trial court’s decision that the City Charter sections providing for a city-wide numbered-seat election system for council elections to be in violation of the CVRA.
On February 12, 2021, the City paid plaintiffs’ fees and costs in the amount of $3,830,090.21 that had been awarded in Amended Judgment for the trial phase of the litigation.
On April 21, 2021, the City and plaintiffs entered into a settlement agreement requiring the City to pay the plaintiffs an additional amount of $712,500 for their fees and costs on appeal. The settlement agreement requires the City to place a charter amendment on the June 2022 ballot to change its charter provisions from the city-wide system to a six- district system for the election of its council members.
Expenditures
The City’s total expenditures to outside counsel in connection with the CVRA matter was approximately $1.5 million. Those expenditures included approximately $105K in prelitigation advice with respect to potential charter amendments (Measure A), $750K in litigation costs through trial, $163K in expenditures to reduce plaintiffs’ attorneys fees award; $12K in expenditures for advice associated with Measure C; $430K in fees and costs on the appeal; and $40K expended on post-appeal settlement efforts.
The total amount of payments to plaintiffs to satisfy the judgments that City Council agreed to was $4,542,590.21. This included payment of $3,830,090.21 in satisfaction of trial court judgment inclusive of fees and costs and interest, and an additional $712,500 for plaintiffs’ fees and costs on appeal.
CONCLUSION
Several false narratives advanced against the City Council’s decision-making process in defending the CVRA lawsuit warrant correction:
• In defending against the litigation, the Council was motivated by its desire to defend the voters of Santa Clara against the claim that they had elected council members in a racially polarized manner under the at-large provisions of the City Charter. The Council was not attempting to preserve the at-large system in the Charter; it had consistently taken the position that it would ask the voters to amend the Charter to move away from an at-large system to a district-based system.
• Measures A, N and C are all evidence of the City Council’s position that it was not seeking to preserve the Charter’s at-large election system.
• The City Council was also committed to an inclusive public process in the form of convening two Charter Review Committees to hear from the public about what type of election system to transition to. The Council adopted the recommendations of each of the Committees as to how the Charter should be amended; the Council did not assert its political preferences over the Committee recommendations in placing these measures on the ballot.
• Finally, with the intervention of $50K in opposition to Measure A, and $700K in opposition to Measure C by outside parties in alignment with plaintiffs, one could easily draw the conclusion that it was plaintiffs, rather than the City Council, that achieved preservation of the Charter’s at-large voting system. Ironically, plaintiffs now concede that a vote of the people is required to amend the Charter provisions in order to bring Santa Clara in alignment with the requirements of the CVRA.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov <mailto:clerk@santaclaraca.gov> or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
Note and file report.
Staff
Approved by: Brian Doyle, City Attorney
ATTACHMENTS
1. CVRA Chronology
2. February 1, 2020 Konda Letter