• Group Work Triumphs For Alameda Corridor  

    Daily Journal

    April 22, 2002 - "On time and under budget" typically does not describe any project that involves more than 100 private attorneys and lasts nearly a decade - unless the project is the long-awaited Alameda Corridor.

    Planners say the $2.4-billion, 20-mile rail trench between the ports of Los Angeles and Long Beach and rail yards near downtown Los Angeles will ease ship congestion at the ports and vastly increase the importance of West Coast cargo routes.

    When attorneys from eight Los Angeles-area firms stepped forward at the ribbon-cutting earlier this month to receive praise for the project's success, they broke a tacit pact with one another to fly below the radar.

    "I think that we as lawyers - dare I say - were problem solvers rather than gladiators," Ken Gibbs of Gibbs Giden Locher & Turner said. "It was a project where you never saw the lawyers although we were there all the time."

    In addition to Gibbs' firm, the project's outside counsel included attorneys from Manatt Phelps & Phillips; Steptoe & Johnson; O'Melveny & Myers; Weston Benshoof Rochefort Rubalcava & MacCuish; Jones Day Reavis & Pogue; Keesal Young & Logan; and Nossaman Guthner Knox & Elliott.

    "Each of those firms were handling discrete portions of the project, and discrete objectives had to be achieved," Joseph Burton, general counsel for the Alameda Corridor Transportation Association of Governments, said Friday. "We had the right people in place to address a multitude of different issues."

    The corridor association, known as ACTA, first brought in outside counsel in 1993, when O'Melveny & Myers attorneys began negotiating rights of way and acquiring all railroad rights for the project.

    "We helped the ports put together the original business structure for the acquisition and financing and operations for the entire project," Gregory Thorpe of O'Melveny's transactional real estate practice group said.

    Thorpe and 15 other O'Melveny attorneys brought together three major railroads, which were fierce competitors, to forge the historic joint operations plan to run the facility.

    Thorpe recalled "months of very acrimonious negotiating" that, at one point, ceased when the railroad executives walked out of the meetings and vowed never to return.

    "Fortunately, they broke their vow," Thorpe said.

    The project's defining moment for Thorpe, one of about 15 O'Melveny attorneys assigned to the project, was the day the railroad bosses signed the original memorandum of understanding in December 1994.

    "People thought this was an urban planner's fantasy," he said. "They thought we would never get the players to cooperate or get financing. It's a testament to the number of people who worked on it."

    In the fall of 1994, corridor officials turned to Manatt attorneys Lisa Specht and June DeHart, who is based in Washington, D.C., for solutions about how to bridge the project's $400 million funding gap.

    The ports had kicked in $400 million to buy the rights to the railroad routes and had sold bonds to finance the massive project but were still short.

    Specht and DeHart of the firm's government practice group went to work on state and federal lawmakers in early 1995.

    The Manatt attorneys worked with the U.S. Department of Transportation to have the corridor designated as a "project of national significance" in a transportation funding bill, which made a federal loan possible.

    Getting congressional approval for the funding "was quite exciting and a down-to-the-wire" experience, DeHart said.

    Although the project was popular and not opposed, it was held hostage during debate over the budget by lawmakers fighting for their own pet projects.

    But "sitting in the Roosevelt Room at the White House as President Clinton ... signed all the documents for the $400 million loan" to keep the project on track was a memory DeHart reflected on throughout the project.

    Once the funding was settled, DeHart and Specht remained on call to troubleshoot with regulatory agencies in Washington, D.C., and Los Angeles.

    "Everyone invested in this project: all the little cities, the MTA, the state, the city, the ports of Los Angeles and Long Beach," Specht said. "When you do that, everyone has a vested interest in seeing the greatness of this for the region."

    Steptoe & Johnson, hired in 1993, also helped the project navigate the regulatory minefields of Washington, D.C.

    Steptoe attorney Sam Sipe said that, although no one contested the corridor, the project had to meet a "somewhat elaborate public interest standard" to get regulatory approval.

    Sipe put together a detailed presentation for the U.S. Surface Transportation Board and shepherded corridor association officials through several meetings with the board.

    Sipe obtained construction approval for the corridor on June 6, 1996.

    "It was a good project to be involved with as a lawyer because you knew the agency would be interested because it was so much in the public's interest," he said.

    The action moved back to Los Angeles, and by 1997, a handful of firms was working on parallel tracks.

    Gibbs of Gibbs Giden worked up protocols for preventing, mitigating and, if necessary, litigating construction claims of every stripe.

    His partner, Barbara Gadboy, designed the job-training and disadvantaged-business programs that the low-income neighborhoods had required to compensate for construction nuisances.

    "There was virtually no litigation. Claims were resolved in a very quick way but in a very professional way," Gibbs said.

    Gadboy's efforts yielded jobs for 1,000 people, including 300 local hires, as well as 22 percent participation by small and minority-owned businesses.

    "We gave people jobs, and they are going to have those skills for the rest of their lives," Gadboy said. "It had a positive impact."

    Attorneys at Nossaman Guthner Knox & Elliott quickly got to work to clear a path for the trench, negotiating condemnation and utility relocations in 1996, said partner Howard Coleman.

    The firm, led by partner Nancy Smith, penned the massive design-build contract, the heart of the project's construction phase.

    Nossaman lawyers carefully timed their transactions, "making sure the property was available at the same time construction was going on," Coleman said.

    "It was every day for four years to keep it on schedule," Coleman said. "It was a lot of little battles."

    Innovations by the environmental practice group at Weston Benshoof remedied problems with millions of gallons of contaminated groundwater and tons of soil that were discharged daily from the 33-foot-deep trench.

    Sharon Rubalcava and her attorneys worked with regional water quality officials on a plan for handling contamination, and they tested cutting-edge technology in case of unexpected, but inevitable, environmental issues.

    Under Rubalcava's guidance, the corridor association funded cleanups of soil and water contamination found along the route and removed high levels of metals and salts from groundwaters so that they could be dumped safely in local waterways.

    "It could have slowed it down for years," Rubalcava said. Instead, construction stopped for a week.

    Water was central to a special moment in attorney Lisa Beazley's eight-year association with the corridor project - water and mud rushing around her legs as the drains in Compton stretch of the trench overflowed.

    "The drains were not working, and the citizens were really upset, and I was trying to explain to people, 'This is going to happen ... bear with us,' Beazley of Keesal Young & Logan said. "And the next day, the rains eased up."

    Although Beazley and her team did a variety of legal work on the project, their main achievement was negotiating compensation for construction nuisances with cities along the route.

    "We negotiated down to the number of trees, curb heights, the striping on the roads to make sure the cities were satisfied," she said. "They got new sanitation, water lines, fire lines, fire training - a lot of things that they could never have afforded."

    Jones Day Reavis & Pogue also shouldered contractual work and some litigation with the corridor cities.

    Daniel McMillan short-circuited an attempt by the city of Vernon to stop construction over health and safety concerns in October of 2000.

    "If Vernon had been successful in enjoining construction, that would have threatened the project at a number of different levels," McMillan said. "Basically, this was an attempt at greenmail."

    After a multiweek evidentiary hearing that made little splash in the press, McMillan won an injunction against the city, and construction went on as planned.