No settlement in Atherton lawsuit


The lawsuit filed by the development firm Pacific Peninsula Group against the town of Atherton is still active, after the City Council apparently declined to finalize a mediated settlement agreement when it met Wednesday (March 16) night in closed session.

Terms of the proposed settlement are confidential.

The open-session council agenda listed approval of a settlement -- allowing the council to vote on the proposed agreement in public. But the item was pulled from the agenda at the beginning of the open session, an indication that the council didn't accept the mediated terms when it met behind closed doors.

Pacific Peninsula sued the town to recover nearly $300,000 in road-impact fees it claims it was charged illegally.

In 2010, the council approved refunds of a portion of road-impact fees paid by builders before the town discontinued the fee in late 2009 due to controversy about its legality. Pacific Peninsula, a major builder in the town, sued to force the town to refund the fees it paid in their entirety.

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Posted by Sad
a resident of Atherton: Lindenwood
on Mar 17, 2011 at 3:32 pm

It is so sad that meddling by Kathy McKeithen has ruined the opportunity to settle this lawsuit. I thought the goal here was to talk with people in disputes with Atherton and to settle the litigation amicably. This is all McKeithen's fault and since the road impact fee was illegal will certainly cost the Town more money.

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Posted by Evidence seeker
a resident of Atherton: West Atherton
on Mar 17, 2011 at 3:49 pm

Sad, Many California cities have road impact fees. Hard to believe that all these cities are placing themselves in such a legally vulnerable place. Please cite evidence supporting your claim that the fee is illegal.

And while you're at it, please cite evidence that it's McKeithen's fault that the lawsuit hasn't been settled. Thank you in advance.

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Posted by John P Johns
a resident of another community
on Mar 17, 2011 at 4:02 pm

It may not make any difference in the final outcome. However if this has to go to trial, I would suggest the Town depose former City Councilman Charles Marsala beforehand as to whether he gave Steve Ackley confidential information regarding staff's discussions of the legality of the Road Impact fee back in 2006.

I clearly recall when I was working as Finance Director, Marsala had a direct line of communication with the Building Department. I also clearly recall more than one instance in which former Councilman Marsala shared information he obtained from his contacts in the Building Department with litigants and those threatening litigation which was detrimental to the Town's position.

Marsala as we all know was one of those who abused his position on the City Council to bias the outcome of the personnel investigation against me.

Unfortunately the culture of corruption that enveloped the Town affected all levels of Town government.

Additionally, as I read the tea leaves, I suspect Elizabeth Lewis who received political contributions from Ackley and who's illegal home Ackley designed and built was forced to recuse herself from voting on the settlement.

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Posted by peter carpenter
a resident of Atherton: Lindenwood
on Mar 17, 2011 at 4:19 pm

peter carpenter is a registered user.

On another thread about this settlement there was a lot of keyboard bravery in opposition to the unknown settlement. Fortunately ONE brave resident spoke out in the public comment period before the closed session - I suggest that her lone voice tipped the balance against this settlement.

Words on this forum have no impact, showing up and bravely speaking out does. Thank you Malinda.

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Posted by Ed
a resident of Atherton: other
on Mar 17, 2011 at 5:18 pm

To Sad:
Thank you for pointing out so astutely, that the fee was a FEE, and not a tax. This is precisely the point to examine--PPG's whole pretense here was to try to dress a fee up as a tax that had never gotten the voter approval that a tax would have required. I have a copy of the 1980s council meeting where the complete schedule for FEES was updated and some inacted by a unanimous vote of the council--including the one that is relevant here. I inconvenienced Ms. Furth with this document during her first week on the job, she looked crest fallen at it's existence.
To your second point about resolving matters quickly--I quite agree--but as this was PPG's forth lawsuit against the town in a row, one right after the other, I doubt that continuing to give them what ever they want will (or has) deter(ed) future litigation from them.
Also To Peter: I seriously doubt that my remarks had any impact on the council at all---
but I would eat my hat before you could convince me that Elizabeth recused herself from the vote. It had to be Mckeithen, Dobbie with Widmere on board for a majority against Elizabeth and Jerry.

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Posted by POGO
a resident of Woodside: other
on Mar 17, 2011 at 7:24 pm

Ed -

If Ms. Lewis recused herself as has been suggested, perhaps there was a 2-2 tie.

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Posted by Menlo Voter
a resident of Menlo Park: other
on Mar 17, 2011 at 8:36 pm


I'll give you 5:1 odds Lewis did not recuse herself. She is too beholden to Ackly and the otehr developers to step away from this. Five lunches to one. We have a bet?

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Posted by Ed
a resident of Atherton: other
on Mar 17, 2011 at 9:24 pm

That's Mr. Ed to you Pogo.....
but "hat" remains on the menu and there is plenty for three

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Posted by Question for Peter Carpenter
a resident of Atherton: other
on Mar 17, 2011 at 11:20 pm

Under the Brown Act, do we have the right to know which council members voted for a settlement and which voted against it in the closed session? My guess is yes we do, though not the details of what the settlement was, and I think the Town of Atherton should make this information available to the public.

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Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 18, 2011 at 4:47 am

I have already asked the Town Clerk for details regarding any decision made in the 16 March Closed Session.

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Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 18, 2011 at 6:56 am

From: Peter Carpenter
Date: March 18, 2011 6:50:08 AM PDT
To: Bonnie Eslinger <>
Cc: Theresa DellaSanta <>, "" <>, John Danielson <>
Subject: Re: 16 March Closed Session

See SJ Mercury article:
"Atherton council rejects settlement of road fee lawsuit

By Bonnie Eslinger

Daily News Staff Writer
Posted: 03/17/2011 10:40:24 PM PDT

The Atherton City Council has rejected the proposed settlement of a lawsuit filed last August by a local developer who contends the town illegally charged $298,000 in road impact fees.

As a result, the town could end up fighting the suit in court. "We remain confident in the legal arguments of our case," said Leah Castella, Atherton's special litigation counsel. "The settlement was always contingent on council approval."

Castella said she couldn't discuss why the council decided in closed session not to settle."

Clearly a decision was made and the votes on that decision must be made public.


On Mar 17, 2011, at 5:43 PM, Peter Carpenter wrote:

The item was removed from the open session - such a removal could ONLY have been done by a consensus of the Council and the votes on such a consensus MUST be reported.


On Mar 17, 2011, at 5:40 PM, Theresa DellaSanta wrote:

Hi Peter

The report out of closed session was that there was no reportable action.

I leave the special meetings immediately after the public announcement of closed session items is made. I am forwarding your email to John Danielson with a copy to our City Attorney Ben Winig.

Thank you.


-----Original Message-----
From: Peter Carpenter []
Sent: Thursday, March 17, 2011 5:27 PM
To: Theresa DellaSanta
Subject: 16 March Closed Session

Was there any vote or consensus on the proposed PPG settlement item - either to not consider it at this time or otherwise?

If so who voted and how did they vote?



Sorry, but further commenting on this topic has been closed.

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