HomeMy WebLinkAboutWright, L'Estrange & Ergastolo 2019-08-28WRIGHT, L'ESTRANGE & ERGASTOLO
LAWYERS
402 WEST BROAOWAY, SUITE 1800
SAN DIEGO, CALIFORNIA 92101
(619) 231-4844 • FAX (6191 231-6710
WWW.WLELAW.COM
August 21, 2019
VIA EMAIL ONLY
Sage Sangiacomo, City Manager
The City of Ukiah
300 Seminary Avenue
Ukiah, CA 95482
ssangiacomo@cityofukiah.com
6-2„,*) oz„_
Sender's email address:
aschouten@wlelaw.com
Re: County of Mendocino RFP No. 56-17 Exclusive Operating Area Provider for
Emergency Ambulance Service
Dear Mr. Sangiacomo:
As you know, Anderson Valley Community Services District a.k.a. Anderson Valley Fire
Department ("Anderson Valley Fire") has hired the law firm of Wright, L'Estrange & Ergastolo
("WLE") in connection with the above -referenced request for proposals ("RFP") (the "Matter").
The City of Ukiah ("City") recently asked WLE to represent it in connection with the Matter.
A request to represent one client on the same matter as another client raises the possibility
of an ethical conflict. It is our duty to investigate the relevant facts and inform our existing and
prospective clients at the outset of the engagement of the ethical issues and the basis of our
conclusion to proceed with multiple representations.
We made an independent evaluation of the relevant facts and law, including ethical
considerations. We conclude there is no existing ethical conflict, and, while there is a potential,
future conflict, the likelihood of such conflict becoming an actual conflict does not prevent WLE
from representing Anderson Valley Fire, the City, or both on the Matter.
Following is a summary of our investigation:
THE ETHICAL RULE
California Rule of Professional Conduct 1.7 provides in pertinent part:
(a) A lawyer shall not, without informed written consent from each
client and compliance with paragraph (d), represent a client if the
representation is directly adverse to another client in the same or a
separate matter.
WRIGHT, L'ESTRANGE S, ERGASTOLO
LAWYERS
City Manager Sage Sangiacomo
August 21, 2019
Page 2
(b) A lawyer shall not, without informed written consent from each
affected client and compliance with paragraph (d), represent a client
if there is a significant risk the lawyer's representation of the client
will be materially limited by the lawyer's responsibilities to or
relationships with another client, a former client or a third person,
or by the lawyer's own interests... .
(d) Representation is permitted under this rule only if the lawyer
complies with paragraphs (a), (b), and (e), and:
(1) the lawyer reasonably believes that the lawyer will be able to
provide competent and diligent representation to each affected
client;
(2) the representation is not prohibited by law; and
(3) the representation does not involve the assertion of a claim by
one client against another client represented by the lawyer in the
same litigation or other proceeding before a tribunal.
Rule 1.0.1 further defines "informed written consent" as meaning:
(e) "Informed consent" means a person's agreement to a proposed
course of conduct after the lawyer has communicated and explained
(i) the relevant circumstances and (ii) the material risks, including
any actual and reasonably foreseeable adverse consequences of the
proposed course of conduct.
(e-1) "Informed written consent" means that the disclosures and the
consent required by paragraph (e) must be in writing.
Because of the potential of a conflict, we request that you sign this document as a condition
to our representation of the City. Such representation is subject to Anderson Valley Fire also
signing a conflict waiver letter.
WRIGHT, L'ESTRANGE & ERGASTOLO
LAWYERS
City Manager Sage Sangiacomo
August 21, 2019
Page 3
RELEVANT FACTS'
On February 19, 2019, the Coastal Valley Emergency Medical Services Agency
("CVEMSA"), the local emergency medical services agency for Mendocino County ("County"),
issued the RFP seeking emergency ambulance providers to service a new exclusive operating area
("EOA") in inland Mendocino County pursuant to California Health & Safety Code section
1797.224. The RFP's submission deadline is September 3, 2019. The RFP strongly recommends
that the new EOA provider subcontract with existing fire service agencies to continue services
within their respective service areas after the contract is awarded.
Anderson Valley Fire currently provides basic life support emergency ambulance service
within the Anderson Valley area. Anderson Valley Fire would be displaced by the new EOA
provider. It does not operate pursuant to California Health & Safety Code section 1797.201; it
began providing service in 2017 after it purchased the nonprofit Anderson Valley Ambulance
Service, which had been providing ambulance services in the area since 1954. Anderson Valley
Fire relies on certain subsidies from the County to sustain its volunteer firefighters. The County
has represented to Anderson Valley Fire that it will discontinue subsidizing Anderson Valley Fire's
operations once it awards a contract to the new EOA provider.
Anderson Valley Fire retained WLE to represent it in connection with the Matter on July 2,
2019.
The City has retained its right and obligations to administer its emergency dispatch, non -
transport first response, and ambulance services pursuant to California Health & Safety Code
section 1797.201 ("Section 1797.201"), within its territorial boundaries.
In 1991, the City enacted an ordinance that effectively made its fire department the
exclusive provider of emergency ambulance services in the City. This resulted in lawsuits between
the City and the County, and the City and Ukiah Ambulance Service, which was then the City's
private ambulance contractor. The two lawsuits were consolidated into a single proceeding.
In Cty. of Ukiah v. Cnty. of Mendocino, Mendocino Cnty. Superior Ct. Nos. 65248 and
65575 (November 22, 1994), the Court found that the City retained its rights and obligations under
Section 1797.201 and the City and CVEMSA would have to enter an agreement under Section
1797.201 to transfer the City's administration of its EMS to the County.
Subsequently, the City entered into an agreement with the County, which provided that if
an ambulance service other than the City's provider wanted to respond to EMS calls in the City,
an agreement between the City, the ambulance service and CVEMSA would be necessary before
the ambulance service could operate within the City. In the absence of such agreement, "the
1 The facts in this section have been taken from the City's, CVEMSA's, and the County's publicly -
available documents, as well as conversations with representatives of the City and Anderson
Valley. To the extent that any of these facts are inaccurate, our analysis of the conflict may change.
WRIGHT, L'ESTRANGE & ERGASTOLO
LAWYERS
City Manager Sage Sangiacomo
August 21, 2019
Page 4
COUNTY may conduct a competitive bid process to select an exclusive provider, subject to the
CITY's rights under [Section] 1797.201. CITY shall be afforded reasonable opportunity to
participate in such competitive process."
On July 1, 2017, the City entered into a shared management agreement to jointly exercise
its common powers related to emergency response services with the Ukiah Valley Fire Protection
District ("Ukiah Valley Fire"). The City and Ukiah Valley Fire use the designation Ukiah Valley
Fire Authority ("Ukiah Fire Authority") to identify the services provided under such agreement;
however, the Ukiah Fire Authority is not a separate legal entity.
CVEMSA began developing the RFP several years ago. Early on in the process, the City
communicated to the County and CVEMSA the following points: (1) the level of service within
the City's and Ukiah Valley Fire's boundaries must be maintained at or better than historic levels;
(2) the impact to existing fire service agencies must be mitigated and coordinated with the EMS
providers, such that the integration of EMS providers and existing fire service agencies should be
set forth in the RFP, rather than negotiated during the bidding process or after a contract award.
During the CVEMSA's development of the RFP, the County took the position that the City
cannot participate in the detailed drafting of the RFP because of the potential contractual
relationships that may arise between the City and potential bidders on the RFP. To ensure that the
City's concerns were addressed prior to the award of an RFP, the County offered to enter into a
memorandum of understanding ("MOU"). Per the MOU, the City was given 60 days to submit
comments and concerns after the RFP was issued. If the City submitted comments, the City and
County were required to meet and confer in good faith to address the City's concerns. The MOU
further provided that the City would not bid on the RFP but acknowledged that the City had not
waived its Section 1797.201 rights. The City and the County entered the MOU on May 20, 2018.
After the RFP was released, the City reviewed its specifications and concluded that the
RFP presented numerous concerns and issues for the City (as well as other fire service agencies in
the County), including inadequate response time requirements, inadequate penalties for
noncompliance, inadequate financial contributions to offset dispatch costs, and a lack of fiscal
incentives to partner with fire service agencies to achieve higher efficiencies and better patient
outcomes. Pursuant to the MOU, the City requested a meet and confer with the County.
The City and the County met and conferred over the RFP on March 11, 2019. At the
meeting, the County indicated that it was considering additional options, but was unwilling to
discuss those options prior to releasing them as addenda to the RFP. The City and County agreed
to extend the MOU to allow for additional discussion following the release of any revisions to the
RFP and the first mandatory bidders conference.
The City participated in all RFP -related bidders conferences and submitted a list of
questions through the formal RFP process on March 22, 2019.
WRIGHT, L'ESTRANGE & ERGASTOLO
LAWYERS
City Manager Sage Sangiacomo
August 21, 2019
Page 5
On April 16, 2019, the County released an addendum to the REP that required bidders to
respond to two additional options related to response times and inter -facility transfers. The City
concluded that the addendum did not fully address its concerns, as the new responses times would
still result in a reduction in service levels and impact the City's fire operations by delaying its first
response EMS personnel until ambulance transport arrived. The City requested another meet and
confer.
The County responded to bidders' written questions in a July 9, 2019 addendum to the
RFP. It did not address the City's questions.
On July 18, 2019, representatives from the City and County met and discussed potential
alternatives related to providing EMS services in the County. The City relayed its concerns
regarding the RFP and offered to give the County time to determine whether it would reevaluate
the process and approach or proceed with the RFP.
On July 22, 2019, the County informed the City that it was moving forward with the
existing RFP and process. The City immediately requested a meet and confer to discuss its specific
concerns and possible revisions to the RFP to address those concerns as provided for in the MOUs.
The City also noted the that RFP submission deadlines would need to be altered to allow time for
additional, good faith meeting(s). The County did not respond to the City's meet and confer
request.
On August 1, 2019, the City requested that WLE represent it in connection with the Matter.
After investigating the relevant circumstances, WLE advised the City that it could not accept the
engagement due to a potential conflict arising out of its representation of Anderson Valley Fire.
On August 7, 2019, Anderson Valley Fire, the City, other fire service agencies in the
County, and representatives of the California Fire Chiefs Association met to discuss the City's
potential exercise of its Section 1797.201 rights. The participants in that meeting generally agreed
that the RFP does not represent a good deal for the County's existing fire service agencies and the
proposed EOA would not be economically viable if it does not include the City. They also
expressed interest in pursuing potential EMS system design that ensure the economic viability of
the system and the providers' services by relying on supplemental Medicare and MediCal
reimbursements available only to public ambulance transport agencies. At the meeting, Anderson
Valley Fire Chief Andres Avila stated that Anderson Valley would allow WLE to represent Ukiah
Fire in connection with the matter.
Later that day, the City Council of Ukiah voted 5-0 to exercise the City's Section 1797.201
rights and to not participate in the County's proposed EOA.
In a letter dated August 16, 2019, the City informed the County of the City Council of
Ukiah's vote to exercise the City's Section 1797.201 rights and stated:
WRIGHT, L'ESTRANGE & ERGASTOLO
LAWYERS
City Manager Sage Sangiacomo
August 21, 2019
Page 6
As a result, the [City] will not be participating in the County's proposed [EOA] and
has directed city staffto begin investigating the procurement of ambulance services
for the City and to make recommendations to the City Council. Please note, this
direction does not preclude consideration of a collaborative option with the County
if agreement can be reached under an alternate approach.
Please notify all of your bidders that the [City] is not part of the County' s EOA and
corresponding [RFP].
The County has not formally notified bidders of the City's action or amended the RFP. It
is our understanding that the County will likely move forward with the RFP and see whether it
receives acceptable proposals from interested bidders.
MATERIAL ETHICAL CONFLICTS
At this time, we are not aware of any present and material conflict that would prevent WLE
from representating Anderson Valley Fire and the City in connection with the Matter.
However, we are aware of a potential, future conflict that could ripen into a directly adverse
conflict for purposes of California Rule of Professional Conduct 1.7(a). A directly adverse conflict
arises when "a lawyer accepts representation of more than one client in a matter in which the
interests of the clients actually conflict." Cal. R. Prof. Conduct 1.7, cmt. 1. Such potential, future
conflict also triggers WLE's duties under California Rule of Professional Conduct 1.7(b).
A conflict between Anderson Valley Fire and the City would only arise if and when their
interests became actually adverse. The City has immediate need for legal representation on the
Matter due to its assertion of Section 1797.201 rights and the impending RFP response date.
Representation of the City could result in WLE filing suit on the City's behalf against CVEMSA
and the County to set aside and enjoin the RFP as violative of the City's Section 1797.201 rights.
Anderson Valley Fire does not need legal representation on the Matter until CVEMSA and the
County award the EOA contract to a responsible bidder submitting a proposal responsive to the
RFP's specifications.
However, since the County and CVEMSA have not amended the RFP to exclude the City
from the EOA, it appears that any award of corresponding EOA contract to a new provider would
be invalid and unlawful. Valley Med. Transp., Inc. v. Apple Valley Fire Prot. Dist., 17 Ca1.4th
747, 759 (1998) ("the ability to create EOA's in section 1797.224 is made expressly subject to
[Section] 1797.201, and therefore would not permit a county or EMS agency to unilaterally
displace a city or fire district continuing to operate [EMS]"). And if the County and CVEMSA
award an EOA contract to a bidder that did not include the City in its response, other bidders would
likely prevail in a bid protest and invalidate the contract award on the ground that the winning bid
was inconsistent with the RFP's specifications. Konica Bus. Machs. U. S. A. v. Regents of Univ.
of Cal., 206 Cal.App.3d 449, 454 (1988) ("A basic rule of competitive bidding is that bids must
conform to specifications, and that if a bid does not so conform, it may not be accepted.").
WRIGHT, L'ESTRANGE & ERGASTOLO
LAWYERS
City Manager Sage Sangiacomo
August 21, 2019
Page 7
Moreover, if it is forced to file a lawsuit against the County, CVEMSA, or both, the City
would presumably request preliminary injunctive relief against the RFP until such time as the
Court decides the issues presented by the lawsuit. Under these circumstances, the potential conflict
between Anderson Valley Fire and the City would not ripen into an actual conflict unless and until:
(1) the Court denies an injunctive relief request and the County awards the EOA contract; or (2)
the Court grants an injunctive relief request and fmally resolves the lawsuit against the City.
Otherwise, Anderson Valley Fire and the City are not adverse; both believe that the RFP
does not represent a good deal for them, the EOA is likely unworkable without the City's
participation, and that an EMS system design solution that leverages supplemental reimbursements
from Medicare and MediCal would be an acceptable alternative to the RFP.
Additional conflicts could arise in connection with the Matter if there is a change in
circumstances. An example of such conflict could arise if one Anderson Valley Fire agreed to
serve as a subcontractor to an ambulance provider submitting a bid on the RFP while The City was
challenging the RFP in court. Another example would be if one Anderson Valley Fire intervened
in any litigation between the City and the County over the RFP and sided with the County against
the City. We are not suggesting anything of this nature is likely to occur, but they are examples
of what would lead to an ethical conflict.
WLE believes that it will be able to provide competent and diligent representation to each
Client and that such representation is not prohibited by law.
CONFIDENTIAL COMMUNICATIONS
As your attorneys, we are bound by professional standards and the law to maintain inviolate
all confidential communications with you during our engagement. However, when there is a joint
representation, as proposed here, all confidences shared with us as your attorneys are "joint
confidences." Unless Anderson Valley Fire and the City agree otherwise, either could be required
to repeat these confidences to the other at some point in the future if there is a dispute between
them.
CONFLICT WAIVER
As discussed above, we believe that a disqualifying ethical conflict is possible, but
unlikely, under the present circumstances. Normally, absent advance consent in such
circumstances, we, as lawyers, would be required to withdraw from representing both clients.
Each client would then be required to obtain separate new counsel. The conflict also may prevent
us as lawyers from passing on our work -product to any successor counsel. That, of course, would
result in a very large expense to both clients, especially if it becomes necessary to re-educate
separate sets of lawyers.
WRIGHT, L'ESTRANGE & ERGASTOLO
LAWYERS
City Manager Sage Sangiacomo
August 21, 2019
Page 8
In recognition of these facts and being fully advised and having had the opportunity to
consult independent counsel, you agree if such a situation should arise, WLE may continue to
represent Anderson Valley Fire and the City will obtain new counsel to the extent necessary. At
that time, you will reaffirm its consent to WLE continuing to represent Anderson Valley Fire in
the Matter. Furthermore, you will not assert any conflict of interest or seek to disqualify WLE
from representing Anderson Valley Fire, notwithstanding any adversity that may develop.
CONCLUSION
In light of the foregoing, it is our conclusion there is no existing conflict and the likelihood
of a later disqualifying conflict is remote. If you are in agreement with this analysis and the facts
upon which the analysis is based, please sign where indicated below and return the enclosed copy
of this letter to the undersigned.
I AGREE WITH THE FOREGOING.
DATED: c _ a� , 2019
Very truly yours,
ti\
WRIGHT'L'ESTRANGE',& ERGASTOLO
By
L
Andrew E. Schouten`
THE CITY OF UKIAH
By
omo, City Manager