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April 11, 2013

Judge dismisses suit against mayor, council

A lawsuit a Logansport citizen filed against the city last month claiming an abuse of power regarding Logansport Municipal Utilities’ power plant project has been dismissed.

The suit, filed by Julie Kitchell, claimed the city engaged in the process of developing a public-private agreement with Pyrolyzer LLC to develop a new power plant before adopting an ordinance authorizing it to do so. Lawyers representing Logansport Mayor Ted Franklin and City Council responded to the suit by citing a provision in Indiana Code allowing for the ratification of previous actions.

Cass County Superior Court II Judge Rick Maughmer, who ruled on the case, mentioned this provision in his court order as one of the reasons for its dismissal. He also stated Kitchell’s suit failed to state a claim upon which relief could be granted and fails to allege she sustained any kind of injury as a result of the conduct of Franklin or city council.

“I’m not at all surprised by the ruling,” Franklin said. “We have felt all along that we’ve gone the extra mile in making sure we’ve done everything properly.”

Franklin went on to say he viewed Kitchell’s claims as “obstructionist.”

“The plaintiff and her attorney are just reaching for straws,” he said. “They’re looking for anything to slow down the process we’re taking. It’s ridiculous. It’s over. I hope they realize it’s over as well.”

Jim Brugh, Kitchell’s attorney, filed a response to the city’s motion to dismiss last week. In it, he maintains the city engaged in the public-private agreement process before adopting the ordinance authorizing it to do so.

“It is a fact that the city failed to perform the condition precedent,” Brugh writes. “A city has to decide to engage in the public-private agreement process. First, the city must vote to accept/adopt the State public-private law.”

His statement goes on to dismiss claims by the city that Indiana Code allows it to ratify prior actions, writing that he has yet to find an interpretation of this in the state’s case law.

“A review of ‘ratification’ by municipal corporations in other jurisdictions shows that the concept applies to contracts, not ordinances or resolutions of empowerment,” Brugh writes. “...There is no legal precedent for the city’s contention that a ratification resolution today creates a power in the past.”

After reviewing Maughmer’s ruling, Brugh said, “I am conferring with my client to determine how next to proceed.”

Responding to the ruling via email, Kitchell wrote she was “not shocked” by Maughmer’s decision and that she and Brugh are contemplating an appeal.

“The real contemplation that has been going on even before this suit was filed is by the Logansport and Cass County residents and Logansport Municipal Utilities ratepayers who question the wisdom in a process that has overlooked the city’s own consultants in favor of an unproven, untested and risky venture that could hamstring the city, county and LMU for many years,” Kitchell stated.

Kitchell went on to reiterate requests she has made in the past at public meetings — that the city explore a renegotiation of its contract with Duke Energy to explore options with wholesale power providers.

“The mayor’s comment at a recent city council meeting that he doesn’t expect Duke to approach the city to renegotiate demonstrates that he neither cares about utility rates that will be escalating the next four years or that he understands the issue that has been raised,” Kitchell stated. “It may only signal that he is more concerned with working on a public/private partnership once he leaves office, which would explain his motivations.”

Joe Buck, president of city council, said he was “greatly relieved” to hear of the ruling.

“I’m just glad it’s over and we can move on with progress for Logansport,” he said.

John Molitor, an Indianapolis-based attorney who represented city council in the lawsuit, said he felt the ruling was not only favorable for the mayor and council, but for Logansport’s citizens as well.

“This is a good thing for the community,” he said. “It cuts off additional legal costs and allows the city to save costs it would have incurred if this went on longer.”

Mark Crandley, an attorney with Indianapolis-based Barnes & Thornburg LLP representing Franklin in the suit, agreed with Molitor about the promptness of the ruling.

“We thought the law in this area was well established and we feel confident the judge applied it correctly and are pleased it’s over as quickly as it is, with the priority being there’s a project at issue here,” he said. “Hopefully this ends matters as far as we’re concerned.”

Mitchell Kirk is a staff reporter at the Pharos-Tribune. He can be reached at 574-732-5130 or mitchell.kirk@pharostribune.com.

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