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RESOLUTION NO. 9- 6 r
A RESOLUTION ADOPTING AN AGREEMENT AMONG
VARIOUS PUBLIC AGENCIES OF THE STATE OF
WASHINGTON FOR THE PURPOSE OF JOINTLY
PERFECTING CLAIMS FOR ALLEGED OVERCHARGES
WHEREAS, the State of Washington has commenced
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an action in the United States District Court for the.
Western District of Washington against certain manufacturers
of asphalt and asphalt products, alleging that such manu-
facturers have engaged in certain activities in restraint
of. free and open interstate trade and commerce in asphalt
products in violation of the Sherman Act; and
WHEREAS, the action of the State of Washington
alleges that the activities of said manufacturers have
arbitrarily and unlawfully increased the. cost to it of
asphalt'products purchased for use in highways and other
facilities constructed and maintained by the State and
said action, pursuant to the Clayton Act, .seeks threefold
the damages sustained by the State in connection with its
purchases of asphalt products; and
WHEREAS, the commencement of such action by
the State constitutes a certification by it that good
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cause exists to justify the allegations of the complaint;
and
.WHEREAS, the Attorney General of the State of
Washington has notified this public agency of the pending
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litigation and has advised it that the prices paid by it
for asphalt products have probably been affected in the
_same manner and to the same extent as the prices paid by
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the State of Washington have been affected by the alleged
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unlawful activities of the manufacturers; and
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WHERE~S, this public agency has invested
substantial sums of money in the construction and main-
tenance of roadways and other faciliti~s utilizing asphalt
products, which sums of money may have included unlawful
and recoverable overcharges; and
WHEREAS, the duly authorized officials of this
agency hold it to be. their duty and obligation to minimize
the costs of government and of supplying services and
facilities to the public and believe that an effort to
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recover unlawful overcharges is a proper means,by which
to accomplish this objective; and
WHEREA~ the Attorney General of the State of
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Washington has advised this and other public agencies in
Washington that he anticipates: (a) that the court will
require the activities of all claimants to be coordinated,
not only with those of other public agencies located in
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.Washington but 'also with those of public agencies ,located
in the States Of California and Oregon, which have filed
similar lawsuits; (b) that to obtain the evidence of
liability and damages necessary to perfect the claims of
any of the public agencies in Washington will require the
expenditure of substantial sums of money and amounts of
time; (c) that in order to obtain the information needed
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to develop an adequate economic proof of both the fact
and amount of damages alleged, it will be necessary to
obtain information from this and other pu~lic agencies
concerning their purchases of asphalt products whether
or not such agencies participate in the, litigation; a~d
WHEREAS, it is apparent that neither this
nor any other public agency in Washington has available
to it individually sufficient finances with which to pay
the costs of seeking recovery or personnel with sufficient
time or expertise in antitrust law;
NOW THEREFORE BE IT RESOLVED that it is in the
best interests of this public agency to enter into a joint
and coordinated undertaking with the state of Washington
and all other public agencies which desire so to do for
the purposes of participating 'in the subject litigation;
providing joint financing for the costs thereof, establishing
a manner for distributing the proceeds, if any, of the
litigation; adopting a workable program for the coordination
of the activities of those agencies participating in the
subject litigation; and of retaining experienced antitrust
counsel to represent and perfect the claims of this agency.
THEREFORE, this agency herewith agrees and
contracts with'the State of Washington that:
1. The, terms and conditions herein set forth .
'shall be available to and binding upon each and all other
public agenci~s which by law are empowered to agree and
contract with the State of Washington and this agency and
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do so by the execution of a counterpart resolution or
ordinance containing terms and conditions identical to
those herein set forth.
2. There shall be established an account
to be known as the "Asphalt Litigation Trust Account,'~'
,which shall be administered by and the trustees of which
shall be the Attorney General of the State of Washington
or a designated member of his staff and the Prosecuting
Attorney of Snohomish County or a designated member of
his :staff.
3. Such trustees, in coordination with
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the hereinafter mentioned special counsel, shall have
the authority and responsibility for establishing, on
an annual or other periodic basis, the estimated amount
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of funds which shall be necessary to pay the costs of
litigat~on as the same are incurred over the period
established.
4. upon receipt of notice from the trustees
requesting payment, this agency agrees to pay its pro rata
share of costs into the Asphalt Litigation Trust Account.
This agency's pro rata share shall be determined as set out
in the hereto attached and incorporated Appendix A. Inasmuch
as the data necessary to make the computations provided in
Appendix A will not be available for some period of time,
and inasmuch as costs have been incurred and will continue
to be incurred during this period of time, this agency
agrees, and the fiscal officer hereof is herewith authorized,
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to forthwith advance to the Asphalt Litigation Trust
Account the amount of money determined in the hereto
attached and incorporated Appendix B, provided, however,
that when the Appendix A computations are made, the
trustees shall make an appropriate adjustment of the
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Appendix B advance.
5. This agency herewith accepts, adopts and
ratifies the terms and conditions of the contract of
employment of special counsel heretofore entered into
between the State of Washington and the Seattle law firm
of Ferguson & Burdell and herewith authorizes the Attorney
General to act for and in behalf of this agency in entering
into a contract of employment with Ferguson & B~rdell in
,the form set out in Appendix C, hereto attached and
incorporated.
6. In addition to the above-d~scribed duties
and responsibi~ities of the trustees of the Asphalt Liti-
gation Trust Account, they are also empowered and directed
to incur such obligations and disburse funds in payment
thereof as, in their discretion, shall be necessary and
advisable to perfect the claims of the parties to this
agreem~nt, including the disbursement of funds to or at
the direction of Ferguson & Burdell in reimbursement for
o~ payment of ,those costs and out-of-pocket expensep
defined in Appendix C.
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7. In addition to his responsibility and
authority as a trustee, the Attorney General is hereby
delegated and herewith accepts such responsibility and
authority as is necessary to act for and in behalf of
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this agency with respect to all matters connected wi~h:
(a) the perfection and management of the claim alleged
by this agency in the subject litigation; (b) the manage-
ment of the litigation itself; and (c) the supervision of
special counse; provided, however, that final acceptance
of any offer of compromise or settlement is and shall remain
the prerogative of this agency; and provided further that
the agents and employees of this agency are herewith
authorized and directed to extend to the Attorney General
and to Ferguson & Burdell full cooperation and assistance
in all matters connected with this litigation, including
but not limited to gathering of such information and data
concerning and possessed by this agency as is requested
by the defendant asphalt manufacturers, which gathering
of information and data shall be and remain the responsi-
bilityof this agency.
8. Inasmuch as the cooperative efforts provided
for in this agreement are a necessary prerequisite to the
successful prosecution of the subject litigation in behalf
of the signatory p~rties, and inasmuch as it is not possible
to exactly know but only to make an economic estimate of
the amount of overcharges, if any, pa~d by this and other
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public agencies, and such estimate cannot be made prior
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to this undertaking; this agency agrees with all others
who are or may become parties to this agreement that the
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proceeds of this litigation, whether payable to it separat~ly
or to them jointly will be deposited in the Asphalt L~tiga-
tion Trust Account and that each agency which is a party to
this agreement, upon the termination o~ the litigation, will
be entitled to the same pro rata share of the total amount
then in the Trust Account as its pro rata share of costs
advanced as of the time of termination; provided however,
that prior to the pro rata disbursement of proceeds as
herein set forth, all costs shall be paid, all amounts
advanced for costs shall be repaid and the fee to special
counsel shall be paid as provided in Appendix C.
9. This agreement shall remain in full force
and effect until,the termination of the litigation or
until the 'final distribution of any proceeds thereof,
whichever shall occur later.
The adoption of this resolution and agreement
is necessary to the public well-being. Therefore, an
emergency is declared and this resolution and agreement
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shall be effective immediately.
PASSED by the City Counc~l and approved by its Mayor
at a regular meeting of, said City Council held on the 15th. day
of May, 1969.
Attest:
Approved as to
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T~LER C. MOFFETT, C~ty Attorney
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APPENDIX A
METHOD OF DETE~1INING SHARES
, OF COSTS ADVANCED AND OF RECOVERY
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Whether an asphalt product has been purchased
directly from a manufacturer unmixed with other materials'
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so that the price paid by the purchasing public agency
represents the price of asphalt only or whether an asphalt
product has been purchased mixed with other materials or
otherwise so that the price paid by the purchasing public
agency contains elements other than the price of asphalt
alone, the figures used in making the computations necessary
to determine pro rata shares shall be that portion of the
price paid by the public agency which is attributable to the
asphalt only.
Each participating agency's pro rata share shall
,be determined in accordance with the following formula:
, Agency's share = Total of Agency's Prices
All Agencies' Total Prices
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"Total of Agency's prices",means that sum of
money which a particular agency has expended for asphalt
only during the period 1945 to date.
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"All Agencies' Total Prices" means the total
of the sums of money expended by all participating agencies
for asphalt only during the period 1945 to date.
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The fractional or percentage figure thus
derived shall be applied to any sum required for costs,
ap determined by the trustees in accordance with paragraph
3 of the agreement, or to any sum to'be disbursed to derive
the dollar amount thereof.
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As used in the above computation, the price of
asphalt only will, in cases of direet purchases, probably
be available from agency records. In those cases where
the asphalt .only price is not available from agency records,
it must be obtained, from the defendant manufacturers'
records. Where the price information is not available from
the foregoing sources, it will be necessary to determine the
actual quantity of asphalt used in each transaction and to
multiply said quantity by the unit price for asphalt pre-
vailing at the time of the transaction in order to fairly
estimate the price of asphalt only for the purpose of
prorating 'shares.
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APPENDIX B
SCHEDULE OF AMOUNTS TO BE
TEMPORARILY ADVANCED FOR COSTS
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I. COUNTIES: Based upon miles of asphaltic surfaced
(457 miles)
$5,000.00
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roadways as reported to the State Highways Depart~
ment (see attached tabulation)
(a) Those counties with more than the
average mileage of all counties
(b) Those counties with less than
the average mileage of all counties $2,500.00
II. CITIES: Based upon population figures, Washington
State Census Board, 1967
(a) population 100,000 and over $2,500.00
(b) Population 20,000 to 99,999 2,000.00
(c) population 10,000 to 19,999 1,500.00
(d) Population 5,000 to 9,999 1,000.00
(e) Population 2,500 to 4,999 500.00
(f) population 2,499, and under 250.00
III. STATE OF NASHINGTON:
50% of costs incurred,as invoices are
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rendered.
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APPENDIX C
FEE AGREEMENT AMONG PARTICIPANTS IN THE
ASPHALT LITIGATION AND THE LAW FIRM OF
, FERGUSON & BURDELL-
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Pursuant to an agreement entered into among the
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State of Washington and the public agencies listed in the
attached pages (hereinafter "participants"), the Attorney
General herewith employs the law firm of Ferguson & Burdell
of Seattle, Washington to render services for and in behalf
of the participants in connection with their claims alleged
against certain manufacturers of asphalt products. The
services contemplated are that Ferguson & Burdell shall have
authority to and shall be responsible for the perfection of
said claims, including, without limitati~n, the initiation
and prosecution of litigation, including preparation, trial,
and appellate proceedings, as may be necessary, and including
negotiation, compromise and settlement. The services shall
include such assistance and advice to the participants as
may be necessary to aid them in collecting information
concerning its transactions with the defendants, whether
direct or indirect. The gathering of such transaction informa-
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tion, however, shall be and remain the responsibility of the
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participants.
In return for its services the law firm of
Ferguson & Burdell shall be entitled to retain twenty-
five percent (25%) of the net recovery from the litigation.
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For the purposes of this agreement, the term
"net recovery" shall mean the difference between the gross
amount collected from the defendants or any of them, whether
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by settlement' or levy of execution following judgment, or .
in any other manner (~uch gross amount shall include any
court awarded attorneys' fees or any amount paid as attorneys'
fees or cost compensation by any defendant) and the amount
advanced by the participants for costs and out-of-pocket
expenses. As used herein the term "settlement 1,1 shall include
recovery on a judgment or any compromise thereof.
For the purposes of this agreement the terms
"costs" and "out-of-pocket ,expenses" sh~ll mean those
expenses necessarily incurred in this type of litigation,
such as: reporters' charges for depositions, transcripts
of hearings, transcripts of trial proceedings, and costs
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of printing briefs; actual travel ~xpenses (accommodations,
transportation, and meals); expenses of meetings; expert
witness fees and expenses; costs of obtaining copies of
documents or reproductions thereof; court costs, long
distance telephone charges; postage; and other similar and
related expenses.
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As provided in the agreement among the parti-
'cipants, they agree to advance their pro rata share of
estimate'd expenses to the "Asphalt Litigation Trust Account,"
to be administered by and the trustees of which shall be
the Attorney General of the State of Washington and the
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Prosecuting Attorney of Snohomish County, Washington, or
a designated member of their respective staffs. Said
trustees shall be authorized to make payments against the
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invoices of Ferguson & Burdell for costs and out-of-pocket
expenses, as herein defined, as incurred.
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In behalf of the participants:
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Slade Gorton
Attorney General
State of Washington
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In behalf of FERGUSON & BURDELL:
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,The state of Washington, acting by
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and through its Attorney General, herewith
accepts the terms and conditions set out
in the attachment entitled A RESOLUTION
ADOPTING AN AGREEMENT ~IDNG VARIOUS PUBLIC
AGENCIES OF THE STATE OF WASHINGTON FOR THE
PURPOSE OF JOINTLY PERFECTING CLAIMS FOR
ALLEGED OVERCHARGES.
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Sr;Ab~ORTON ,,'
Attorney General
State of Washington
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