According to a news report in the American Lawyer, San Diego city attorney Michael Aguirre announced the deal with Orrick, Herrington & Sutcliffe stemming from the city’s ongoing pension scandal. Orrick won the work representing the city in 1992, and from 1996 to 2003 the city’s unfunded pension debt ballooned to an estimated $1.7 billion.
“I brought this lawsuit because I believed Orrick should have discovered the pension problems earlier than it did in September 2003, at which time Orrick advised the city that its financial statements had failed to properly disclose the scope of the shortfall of funds in the pension,” Aguirre said in a statement released Tuesday, according to the report.
Orrick has admitted no wrongdoing as part of Tuesday’s settlement. In fact, the city announced that Orrick has been added to the city’s list of bond counsel firms for future offerings.
Firm spokesperson Allan Whitescarver said two independent investigations commissioned by the City Council found that Orrick did nothing wrong and the court dismissed the city’s original complaint. Tuesday’s settlement follows the announcement in mid-June that the city reached a $4.35 million settlement with Vinson & Elkins (See Law Firm Agrees to $4M San Diego Pension Mess Settlement ).