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HomeMy WebLinkAboutRES NO 114-68 V 10 11 18 18 1V 18 ~0 ~0 RESOLUTION N0. 114-88 PREAMBLE: t. City of Bakersfield , hereafter called entity, has previously authorized the Attorney General of the State of California to institute on its behalf one or more law suits under the Federal Antitrust Laws which law suits were in fact fileg against defendants United States Steel Corporation, Smith-Scott Company, Inc., Kaiser Steel Corporation, United States Industries, Martin- Marietta Corpor~ ion, United COncrete Pipe Corporation, and American Pipe and Construction Co. 2. Pursuant to court orders, similar actions brought by the Federal Government and other plaintiffs in the States of California, Oregon, Washington and Hawaii were all coordinated before a single Federal District Court Judge. 3. In 1967 the actions against all defendants, with the exception of American Pipe and' Construction Co., were settled and compromised on a lump sum basis, the pro- ceeds being distributed amongst the various plaintiffs pursuant to an agreement, all of which was duly approved and ratified by entity an~ approved by the Court. 4. A condition of the acceptance of said partial settlement by certain plaintiffs not represented by the Attorney General of the State of California was an agree- ment by and between the plaintiffs concerning the conduct of the litigation still remaining against, and the allocation among plaintiffs of the expected recovery from defendant America~: This agre_~ment known t~o__Dl~ai__n_~s ............. as the Western Associated Pipe Plaintiffs Organization 1 2 3 4 5 6 V 8 9 10 11 12 13 14 15 16 17 18 T9 20 21' 22 2S 24 25 26 27 28 29 SO Compact provides, among other things, for (a) common sharing of expenses; (b) the retention of a lead counsel to prosecute and try all cases against the remaining defendant American Pipe and Construction Co. under the supervision of an Executive Committee of the plaintiffs party to the compact; and (c) the distribution of any recovery against American to all plaintiffs proportionately to their verified transactions with American over the fourteen year period 1950 through 1963. 5. On July 14, 1967, the Attorney General of the State of California entered into such Compact, hereinafter called WAPP0, on behalf of entity· Since then, the agreements embodied in the WAPP0 Compact have been and are being carried out with the Attorney General of California as chairman of its Executive Committee. 6. Plaintiffs' counsel, acting through their Executive Committee and lead counsel, have now negotiated and reached agreement on the terms of a settlement and compromise of the litigation with defendant American Pipe and Construction Co., the terms of which are more fully set out in the attached document entitled "MEMORANDUM 0F UNDERSTANDING FOR SETTLEMENT OF WEST COAST PIPE CASES BETWEEN ALL PLAINTIFFS AND AMERICAN PIPE AND CONSTRUCTION COMPANY". 7. Such Memorandum of Understanding provides for payment by American to all plaintiffs of the lump sum amount of eight million five hundred thousand dollars ($8,500,000) over a period of seven years with interest. / 1 8 10 11 1~. 18 1V 18 19 ~0 ~V ~8 ~0 NOW BE IT RESOLVED THAT: A. The MEMORANDUM OF UNDERSTANDING FOR SETTLEMENT 0F WEST COAST PIPE CASES BETWEEN ALL PLAINTIFFS AND AMERICAN PIPE AND CONSTRUCTION COMPANY snd the Western Associated Pipe Plaintiffs Organization Compact, copies of which are attached hereto as Exhibits "I" and "III", respectively, are hereby adopted, ratified and confirmed. B. The Mayor, R. V. Karlen, M.D. of entity is hereby authorized to sign the release of claims against the defendant and attached hereto as Exhibit "II" as the official act of entity. C. The Attorney General of the State of California is hereby authorized by entity to enter into a stipulation dismissing this litigation with prejudice and without costs and to'take any and all other action which may be required of this entity in order to effectuate and con- summate the compromise and settlement provided for in said Memorandum of Understanding and distribute any monies received from defendant American Pipe and Construction Co. in accordance with said WAPPO Compact. Adopted this 23rd day of December MAYOR of -the~Cit.~-~-of ~_Bake rs f ie ld' CITY 'C ' , m9 ea 2 5 6 7 8 9 10 11 12 !5 15 i6 '17 18 19 20 25 ~50 Z2 MEMORAN.D~ OF UNDERSTANDING FOR SETTLEENT OF WEST COAST PiPE CASES BETWEEN ALL PLAINTIFFS AND A~\fERICAN PiPE AND CONSTRUCTION CO~vj~ANy Parties: The parties to this memorandum of understanding are the. Western ASsociation of Pipe Plaintiffs' Organization, hereafter referred tO as "WAPP0", and American Pipe and Construction Company, hereafter referred to as "American." Amount to be Paid: American agrees to pay to the fiscal agent designated by WAPPO the sum of eight million five hundred thousand dollars ($8,500,000) payable as follows, to wit: The sum of one million two hundred fifteen thousand two hundred dollars ($1,215,200) on or before January 1, 1969, to the fiscal agent designated by WAPP0 which said sum shall be placed in either an interest-bearing savings account or in the purchase of a certificate of deposit at the option of WAPP0 and which is to be-returned to American in the event of a failure to consununate this. settlement within nine months of the date hereof. Said fiscal agent shall not distribute the sum of one million two hundred fifteen thousand two hundred dollars ($1,215,200) to,'~he plaintiffs until the-fiscal agent has received~ certif{ed copies of the ordersof dismissal of all WAPP0 Pipe Casses. Am&rican further agrees on or befor& January 1, 1969'to deliver to said. fiscal agent its promissory note in the s~am of seven million ~o hundred eight-four thousand eight hundred. dollars ($7,284,800) payable to the order of'said fiscal agent at its. address'in installments as shown on Exhibit "A" and bearing interest at the rate of five percent (5%) per annum on the declining balances of said note, said int'erest to be payable at EXHIBIT I, p. 1 of 5 1 2 3 4 5 6 7 8 the same time principal payments are required to be made here- under. S~id note shall further provide that if any interest is not paid as it becomes due~ it shall. be added to the principal and bear a like rate of interest. Said note shall further provide that if any payment of either principal or interest is not made as it becomes due, the entire Ualance of said note remaining unpaid shall become and be {mmediateiy due and payable. Said note Shall also reserve to American the .right to make pay- 9 t0 11 12 13 lz_.- 15 16 17 t8 !9 20 2! 22 23 25 28 29 SO ments on account of principal or interest in advance of their due date without penalty. Said note shall further provide that in the event an action is con{menced to collect said note or any part thereof~ there shall be added to the judgment for any principal orinterest found by the court to be due such additional sum by way of attorneys' fees as to the court having jurisdiction of said cause shall seem'reason~bie, said attorneys' Lees. to be due on the filing of a complaint. ~~ ] .. ~i ~ ~ i~i1 American by December 16~ 1968 shall provide WAPP0 with copies of any and all agreements or-amendments thereto with creditors of American which authorizes the performance of this mamorand-em of uzSerstanding. and shall be-in form and substance satisfactory to counsel' for WAPP0. American agrees the~ it will erovide such assistance-in verifying plaintiffs' transactions as WAPP0 shall from time to ~mme requxre. American and its attorneys agree' th-anj zuNe appeal of a taxpayer against the City of San Diego shall be dismissed by December t6~ 1968~ and to withdraw motions by American 3i attacking the validity of WAPP0~ selection of special counsel 32 ~ by the S'zate of California~ ...... : ~--' seUtiem-ant with 'the ~, -2- 2 of 5 7 ~ EXHIBIT I, p- 1 2 3 City and County of San Francisco~ and all other pending motions and challenges in the Western Pipe Cases. American and its ~ttorneys agree to execute a covenant in a form satisfactory to WAPPO covenanting that American and its 5 attorneys shall not further attack in any manner the validity 6 of WAPPO and the selection of special counge! by the State-of California. 8 Each plaintiff that is a signatory to WAPP0 shall release 9 its claim against American, and special counsel for WAPP0 !0 shall stipulate to dismissal with prejudice and without costs of its action against American. Protective Order: -. No perso~ attending the meeting between ·counsel on November ~!4 20 and 21, 1968 concerning the subject matter of t~is memorandum 15 ,of understanding shall divulge. the nature thereof nor of any 16 i; of the subjects discussed thereat to any person whose 17 i responsibi!ities or duties to one or more of the parties herein 18 do not require that he be consulted concerning or informed of 19 said discussions in order for o~ne or more of said parties to i take action ~ith respect to any of the subjects discussed on 21 said dates, and no officer, employee or agent of .any of the 22 parties hereto shall disclose any of the aforesaid subjects to 23 any other person' whose resDonsibi!ities or duties to one or ~more of the parties do not require such other person to have 25 knowledge of such subjects in order for one or more of said 26 parties to thke action with respect thereto, until: 27 'ii December 2, 1968~ or. one day fol!oVing dismissal of the .... 2'8 ¢ jur~'i~<'the" ~rial of WaShington Public Power System SuDo!y 29 v. American, whichever is later. 30 .~ 'Consumv~6~on of Settlement: ~, I .~ ~', ttlement herein referred 'to resulted from discussions 32 ~ between counsel for plaintiffs ~nd American in proceedi{~gs 2 3 5 7 S before the Honorable Martin Pence concluded on November 21, 1968 in San Diego~ California. Counsel for the parties hereto each acree to recosm~end in good faith~ without quaiificamion~ and with full measure of support, the settlement set forth herein to their respective client or clients, it being understood that ratification by such clients is necessary. In cons'ideration of the payment of the settlement amount 9 10 set forth in this memorandum of understanding, plaintiffs shall deliver to American duly executed releases and stipulations 1i 12 to dismiss as'above provided, together with duly adopted and certified resolutions or equivalent documents ratifying and confirming this settlement. American agrees to furnish WAPPO with certified copies of 15 '17 18 19 20 21 22 23 25 ~0 were oh the origin-a!. DATED: November 2~ 1968 the resolution of American Pipe and' ConstrUction Company's board of directors, and certified copies of the resolution of Pi-e Linings Inc (the latter concerning the City of San Diego lit_igation) authori~zing American's officers aid attorneys to make this settlement. The doc-e~ents referred to shall be in such form as shall' be agreed to between WAPP0 and ~m~erican. .. Execntion of this Memorandum: This memorandu=m of unde%~Standing may-be executed in any number of counterparts'with like effect as if all signatures EXFf!BiT ~'ATM PAYb'~Z'NT SCHEDLKI~E ('.,_':jOT iNCLUDING iNTE',~EST) January 1, 19 69 April 1~ 1969 july !, 19 69 October 1, 1969 January I, 1970 April 1, 1970 july I, 1970 january 1, 1971 july t, 1971 januar.y.. 1, 1972 july ~1, 1972 january n 1973 -~ july 1, 1973 january !, 1974 july !, 1974 January 1, 1975 $1~2i5;200 505,S00 505~800 505,800 505, S00 505,800 505,800 472,300 472,300 472,300 · 472,300 472,300 472,300 ' ~'72,300 472,300 471,600 Total $8,500,000 EXHIBIT I EXHiBiT "A" p_._ 5 of 5_ 1 2 3 4 5 6 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 24 25 26 27 28 29 30 31 RELEASE OF AMERICAN PIPE &.CONSTRUCTION CO. 1. This release is executed in favor of and for the benefit of American Pipe & Construction Co., a California cgrporation, together with its subsidiary and affiliated companies and the present and former officers, directors,. employees and agents of American Pipe & Construction Co. and its subsidiary and affiliated companies, including successors by merger, the heirs, representatives, executors, adminis- trators, successors and assigns thereof (hereinafter designated as "American" ). This release is executed by City of Bakersfield hereinafter designated as "Releasor". 3. This release concerns and relates to the following products and services manufactured or supplied by American: concrete or steel pipe or any other products or services associated with the construction of pipelines and other installations utilizing concrete or steel pipe, including by way of illustration only and without limiting the generality of the foregoing, the lining or coating of new pipe, the rehabilitation of used pipe, both in place and elsewhere, pipe lining materials such as "Amerplate," either separately or as a constituent part of pipe manu- factured by American or others, and "specials" such as manhole pipe and fittings manufactured, sold by or supplied by American (hereinafter designated "pipe products"). 4. The period of time covered by this release is prior to ~anuary 1, 1969, but inclu~es._ne~rthe~ an~.. transactions between American and Releasor'either directly EXH IB J-r 1 2 3 4 5 6 ,y 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 30 ' 31 or indirectly which transactions are still pending as of January 1, 1969. 5. For and in consideration of the sum of One Dollar ($1.00) and other valuable consideration paid by American to Releasor, the receipt of which is hereby acknowledged, Releasor hereby forever releases, discharges. and acquits American of and from each, every and all claims, controversies, actions, ~uses of action, obligations or liabilities of any nature whatsoever, now or hereafter known, suspected or claimed, which Releasor or any of its agents ever had, now has or hereafter can, shall or may have or allege against American based upon allegations of conspiracy, collusion, monopoly or attempted monopoly, which might be asserted under the Clayton Act (15 USC, §§ 15 and 26), or under any other state or federal antitrust trade regulation or similar law giving rights to relief under the same or similar circumstances; and in connection with the foregoing only, Releasor expressly waives the provisions of Section 1542 of the Civil Code of the State of California, reading: "15~2. (Certain Claims Not Affected by General Release.) A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor." '6. Releasor warrants that the persons executing this document on behalf of Releasor are fully authorized so to do and Releasor makes such warranty in full knowledge that Releasee has no independent knowledge of the authority or lack thereof of such persons but is relying upon Releasor's warranty. 1 3 4 5 6 7 8 9 10 11 13 14 15 16 1V 18 19 20 24 25 ~7 29 30 7. Any claim, action or controversy concerning this release shall be determined under the laws of the State of California· IN WITNESS WHEREOF, Releasor has'caused this release to be executed this 2Srd day of December 1968 . CITY OF~ BAKERSFIELD (Future name't- !?R_emeaso -L U c'Office L;MAY8~:~,'-i;~' ~' Att'esting Witness ~ ~ ~ Office City Clerk WESTERN ASSOCIATED PIPE PLAINTIFFS' COMPACT 1. This Agreement is made and entered into this 14th day of July , 1967, by and between the parties set forth on attached Exhibit "A." Background to and Purpose of Compact: 2. The parties have each for some t~me asserted against defendant American Pipe and Construction Company (hereinafter usually called "American"), and others in Federal Court complaints and causes of action alleging 'damage occasioned by activities in violation of the federal antitrust laws. ' 3. Certain of the parties are also asserting com- plaints and causes of action of the same nature against. American Vitrifled Products Co. (hereinafter 'called ' "Amv.'tt"') and certain of the parties are asserting complaints and causes of action of the same nature relating to in-place. pipe rehabilitation against Pipe Linings, Inc., a subsidiary of defendant American. 4. The parties are in the process Of effectuating an agreement with certain other defendants in the above' actions concerning the pipe transactions of said other defendants and their respective ·liabilities with respect thereto and reserving to the parties t'heir causes of action against. all other persons~ firms, and corporations, including AmeriCan, Amvit and Pipe Linings, Inc. 5. The parties have been and are currently required by the Cour~ in'their handling, past· and present, of this mass of litigation (hereinafter collectively referred'to as the "Western Pipe Cases" or the "litigation") to l~o~erate and to coordinate their respective activities through a single counsel and an attorneys' Steering committee without any assurance of relative trial priority inter se or of any specific .degree of trial consolidation and to proceed to collective and simultaneous preparation.for' trial of all causes pending against American. 6. It further appears from the volume of claims now asserted against American by the parties'that successful early t~ial ofonly some of said causes and execution of Judgment thereon could substantially prejudice the ~collectibility of other claims of equivalent.merit and equity. 7. To achieve equity and parity of .right and bearing in .mind the ultimate equivalence of. the public f interest in all meritorious claims, the parties intend .by !this COmpact'to provide a contract'ual framework to accomplish, amongother'things, t~ following: (a). Create an organization named and hereinafter called, "Western Asso, cia~ed Pipe Plaintiffs' Organiza- 'tion," or, "WApPO," which will equate their diverse interests, sum their common interests ~n~~ decide on steps to be take~ ~ the parties in the Western Pipe Cases; ' (b) Crea~te an Executive Committee of WAPPO to oversee the day-to-day conduct,of the Western Pipe Cases by special counsel; (c) (d) Arrange for the engagement of quali- fied special counsel to conduct.~he Western Pipe Cases on & day-t6-day basis until concluded, subject to the supervision and control of Executive Committee; Provide'for the financing of the Western Pipe.Cases'and the appointment of a Financial Committee composed of two trustees to handle and administer all financial provisions of this Compact; (e) Provide for the distribution of pro- ceeds realized from the Western Pipe Cases among the parties on a pro rata basis in accord with the verified dollar magnitude of each party's claim; and NOW, THEREFORE, in consideration of the foregoing promises, recitals, objectives and purposes, and for other valuable consideration, the parties hereto mutually agree as follows: WAPPO: Organization, Membership, Powers and Duties, Voting, Procedures, Activities, Miscellaneous 8. There is hereby created the Western Associated .Pipe Plaintiffs' Organization (WAPP0),. whose membership shall consist of each party to this Compact and each· of which parties shall be represented inWAPPO activities by and·act through a representative who·is an attorney.· This attorney may represent more than one·party. .(A party may. designate alternate representatives.) Each party hereby delegates to its representative all necessary authority, subject to reasonable reports, to carry out ·Compact, .except· as to those matte:rs.expressly requiring pagty governing body action. 9. WAPPO shall meet onthe call,· reasonably. noticed, of Executive Committee, special counsel, or of 35% of·the votes of WAPPO members evaluated by the formal (transaction basis) vote prescribed herein. lo'. voting at WAPPO Meetings: (a) Unless any representative requests a formal transaction basis vote or this Compact elsewhere so requires, representatives shall each.vote on the matter· being considered, each representative to have only one vote regardless of the number of' parties he represents. This shall be known as the"informal voting basis.·''.· (b) Whenever s representative requests s formal (transaction basis)vote or this Compact so requires, the matter in question shall be determined by formal 'vote and formal vote shall ·supplant informal vote on the same matter if occurring st the same WAPP0 meeting. In a formal vote each representa'tiVe's vote shall be weighted to reflect·· inter party the ~ of dollar volume of the parties for whom · the representative votes and represents to all parties' dollar volume (i.e., 100~) based on pipe acquisition transactions of the parties from American as determined' from the 8~year' verified transaction statements of American ·(Sept. 1, 1954 - Aug. 31,. 1962, inc.) on file with the Bank of America National Trust and Savings Association in San Francisco in its capacity as agent in effectuating the agreements referred to in paragraph 4, above. · (c) Any representative st any WAPP0 meeting· may request either 'an informal or formal vote on any matter and if the request is seconded the vote shall be taken. (d) Unless otherwise .specified herein, 'an informal vote shall be ~decided by s simple majority of those present and voting; and a formal vote shall be decided by 51% of the dollar volume present· and voting. 11.. Duties of WAPPO ·Representative: Each member shall perform such litigation tasks as are assigned to it by special counsel and/or the Executive Committee or by majority WAPP0 vote·. Such tasks are to be distrlbuteld as equitably as possible. 12,. A quorum for WAPPO meetlngs shall be 51% of the do!'lar ~slue .of the 8-year perio~ American verifi- cat, ion statements. 1~, The ~esignated WAPPO represe.~-tati~es of the psr~ies ~re set forth on Exhibit "A" opposite the name of the party re~resented. ~'X'ECU~IVE COMMIT'TEE: Organi~Zation, Membership, Powers and Duties,~. VOting ProcedUreS, Miscellaneous.. ','- 14. The Executive Committee shall consist of one WAPPO representative from each of the following parties or groups of paPtieS: ' (e) Pacific Northwest Los An~ele~ County Flood .Control District City of San Diego Other California plaintiffs .Such representative may be removed'by.either the naming party or by a 90% formal WAPPO vote but the successor shall be named by the naming party. A party may'voluntarily resign its right to designate a WAPPO Executive Committee representa- tive, in which case a 51~ formal WAPPO vote shall designate. the succeeding naming party. The members of the Executive Committee and their alternates are set forthon'attached Exhibit "B." An alternate may vote in the absence of his principal. shall be the representative of the State of California. 16.' The Executive Committee shall meet as needed in. its or its chsirman's discretion tocsrry out its duties and, in addition, shall meeton call, reasonably noticed, of 'special counsel. 15. The permanent Chairman of the Executive Committee 17. Executive Committee meetings shall be limited to its personnel, their aides as needed and the ex officio members who shall be, however, without vote. Said ex officio members are special counsel, his aides as needed and the members of the Financial C6mmittee established by this'Compact... 18. Any W~PPO member may ('but'without vote) attend Executive Committee meetings where his case is under special consideration or the meeting is wi~h representatives:of American and his case is under special. consideration. ..' 19. Any WAPP0 member may attend '(but without vote) any Executive .Committee meeting where he is requested to attend by .a committee member,. but such request 'shall be · .;. ' 20 Executive Committee, subject to the terms. ,and conditions:of'thi~..'Compact,' shallhave full authority. · 'to supervise:and control. special counsel in 'his' carrying. out of the day'to-day. administration.of the litigation ~"Execu- .'..rive. Committee .shall 'report on'its activity at WAPPO meetings calledas thelitigation situation renders'desirable. Where' still'feasible,'WAppO may review and reverse ExeCutive '. C°mmittee...deCisi0ns by.'maJority vote. ' "..2.i'2 RePresentatives:of the Executive Committee 'maY. att~nd'.suchof.:.special counsel'smeetings with re~'re- sentative.'..0f. defendants as.said committee chooses · .. 22:. Voting 'at Executive C0mmit:t~e Meetings: All Execut'iVe:.COmmittee matters.shailbe determined in Executive'Commi~tee meetings."by.'a simple majority of the' m~mbers. PreSent,:.lexcept those matters otherwise treated in this Compact.'.'A quorum' for EXecutive Committee meetings shall be three'membersunless]the non-appearing members '23;...Executive 'Comml'ttee members:shall bereimbursed their'.reaSonable"'travel and living expenses in attending meetings of the ExecutiVe-Comm'ittee dUly'called as'~roVided in this Compact. SPECIAL COUNSEL: Engagement of - Basic' Terms; Powers and .Duties. 24. The'proVisionstf this Compact shall cont_rol. 'over.the ProVisions."o.f.the contract of en~;'em~nt of special counsel" and that contract shall so acknowled:~Ge. .. ~ 25. The Executive Committee shall contr'sct ~ behalf of WAPP0 for the engagement of special counsel sistent with the provisions of this CompaCt. 26. Special counsel shall be entitled to be reim- bursed for expenses incurred in carrying out his duties, as follows: p~rsonalexpenses such as transportation, ·hotel and living/eXpenses, and the usual expenses of'litigation, such as reporters' fees, deposition costs and handling of documents .may be incurred without prior approval by the Executive Committee. Extraordinary expenses such as expert witness fees or 'the employment Of personnel, mustbe approved in advance by the Executive Committee. Expenses will be paid for on amonthly basis basedon statements thereof submitted to and approved by the Executive.Committ'ee and. Finance Committee· 27. Special counsel shall receive for·his services his out-of-pocket expenses and 10% of amounts recovered from American, American Vitrified, and Pipe Linings, Inc. in concluding all the litigation against said defendants, after .first deducting the out-of-pocket expenses of WAPP0 from such recovery.. These shall include all Joint WAPP0 expenses but not those Of the individual members. Any awards of attorneys' fees or costs shall be held and distributed by the Finance C'ommittee in·the same manner as are proceeds of settlement or judgment. 28. Special counsel shall not receive on account of his 10~ contingent fee more than $500,000 unless and until all WAPP0 causes of action against said defendants now on file or subject to s motion to add in the litigation have been terminated. 29. Subject to this Compact, the day-to-day super- vision and control of Executive Committee and the rendition of ~dequate and timely reports to t'he Exg~ut[~e Committee, , special counsel shall have the duty, responsibility, and authority" to conduct the litigation to ~a finaic6n- '~clusiOn on behalf'of all WAPPO members. Special counsel, with.'majorityExecutive Committee approve'l, may determiner..., the trial priority stance'of WAPPO before tiae' judiciary'.]" ' 30. Special counsel is not obligated to initia.te' and conduct' an appeal except'as he is directed by the ExeCutive'COmmittee, but shall be obligated to defend all · . appeals'. '. "F ANCE .. '-Opganization~ Membership, Powers' :' and Duties. . ... '31. Thereishereby created the.Finance Committee: of WAPPO, 'compose~'of.tw0 individuals, Robert M. Desky, Esq. and John M. Burnett, Esq.,.wh0 shall function' vis'a-vis WAPP0 as trustees in.the.matters here set forth. 32. .The .Finance Committee shall'be the historical'. successor and heir to'..the financial administrators of .the Associati~nofPipe ~ntitrust'Plain~iffs (APAP), who' ... arranged forand'handledgroup financing of the litigation:' prior' to' ~bout 'July 1,.196?'.": '- ~-33- The Finance Committee shall arrange for and. 'handle lthe .funding of future litigation expenses and.the · Payment'-thereof.. Funds f. or the pa~nment of litigation' expenseswill.be obtained. frOm the'parties comprising WAPP0 by means of prO rata assessment.based upon-the AmericanS- year' verification statements. SuCh assessmentsshall'be-. ProPosed.by'the'Finance.Committee from time to. time'in such amount's"as.' may be. n~cessary to provide a.' fund f'or"the~payment. Of anticipated eXpenses.of thel~t~tion and shallbe' bY'.the.membe'rsof WAPPO:'. maeh member oFWAPP0 h eby agrees to a approved assessments promptly upon..'.,. demand~ 34. The Finance Committee is authorizea to make. .... · suitable.arrangements for the safekeeping of ali'.funds ':~ received by them or subject to their order and to'engage, .at WAPP0 expense, clerical personnel as-requ'ired incatrying out their duties hereunder. .~., -~ 35--The'FinanceCommittee shall handleallflnancial dealings with special counsel and the Executive Committee, the payment of expenses and all other fina~cial aspects .of "' the litigation. The Finance Committee shall make'the necessary arrangements for and shall oversee the distribution of proceeds of all recoveries contemplated herein. ' Authority to'Negotiate Settlements, to Recommend Approval of Settlements, to ~pprove Settlements. 36. Except as hereinafte~ Provided, special counsel shall only be authorized. to. effect a negotiated settlement of any cause or causes of action upon unanimous recommendation of all members of the ExecutlveCommittee. In the event that settlement of one or more causes of action, but less than. all, is to.be negotiated, the reoommendation of the attorney or attorneys of record for the plaintiff or plaintiffs involved shalZ also be secured. With respect to any case, however, which is in the course of trial(i.e., called for trial by the ~lerk and on which hearings are currently pro- ceeding prior to verdict, or in the instance of a court trial, prior to submission of the cause for decision), special counsel shall be authorized to effect a. negotiated settlement of the case attrial upon the recommendation of three out of five members of the Executive Committee,'provided that under such circumstances the additional recommendation of the attorney or attorneys of record for the plaintiff or plaintiffs whose claims are being tried must alS9 be secured." Notwith'- standing the foregoing provision,.however, any settlement which shall constitute a settlement of the claims of all plaintiffs against one or more' defendants in the Western States Pipe Cases must receive the unanimous.re- "I. conmxendation of all members Of the Executive Committee. .:-~; ".' ' 37~. It-is expressly agreed that no party shall . settle any-cause· of action referred to herein in which -is .a plaintiff except in accordance with 'the provisions of this Compact. In the event that any settlement is recom- mended by special counsel and by the ·Executive Comittee in accordance with the provisions of. the preceding papa'graph 3~, it is agreed on behalf of all attorneys of record for WAPPO members·that they, and each off them, will,. in' good· faith, recommend approval of such Settlement to their publi~ agencies or superiS'~ that they· represent. '~.". -'..' " 38 Notwithstanding any Other provision of this CompaCt, the governing bodies 'of the parties 'hereto expressly reserve the right to approve or disapprove any settlement 'affeCting their respective causes off action. This reservation, however· shall' not be ·deemed to' affect the authority delegated by this'Compact 'to WAPPO, the Executive Co~ittee and special counsel as regards the day-~o-day conduct of the. litigation.' · Distribution of Proceeds of Settlemen~ and Judgments Obtained in the Litigation. ... 39. .All monies 'recovered and received fr0'm 'de-;' fendants American, AmVit and Pipe Lin~n~.s Inc as the' pro- ceeds of either a .settlement. negotiated and agreed upon or a Judgment rendered-in. the !itigatinn shall. be ~ransferred. in~mediately ·upon receipt to the order of the Finance Com' mittee for deposit in a state or national bank designated · .bY-said-Finance .Committ~e~ and sh~'lt be diSaribUCed as pro-' .. vided .here inafter: = ... ,. ' · 10. · Z 40. Proceeds: Priority of Distribution All proceeds received by the Finance Committee shsll~be dis- bursed according to the following priorities:,,· ' ':"'-' ' '(s) Fees of s ·bank, if any, 's'erving~as s depository, or agent for payment. (b) Other expenses of distribution. (c) 'Reimbursement of s'll plaintiffs for the litigatio'n expenses s. dvanced or paid by them to WAPPO pursuant to assessments duly made in accordance with this Compact. (d) Payment to special counsei of the fees and expenses authorized in accordance with this Compact. (e) The' balance of the proceeds as provided. in paragraph 41. 41. Proceeds: Distribution of recoveries from defendant American and Pipe Linings, Inc. After payment of the expenses referred to in the preceding paragraph, the balance of the proceeds (hereinafter referred to as "net proceeds") received from defendants American and Pipe Linings, Inc., whether by settlement or judgment'in any cause o2 action in the Western Pipe Cases shall be distributed among all the parties to.this Compact in proportion to the dollar value that each party's pipe acquisition transactions from American besrsto the total transactions of all the parties, using the transaction verification statements of'American for the 8-year period referred toin paragraph 10(b), above, as supplemented by the additional transaction verifications required by court order of American for the periods January 1, 1950 through August 31, 1954, inclusive, and Septemberl, 1962 through December 31, 1963, inclusive, the aggregate of all such periods being referred ~o herein as "the 13-year period." Additionally, PiPe rehabilitation transactions of" ll. the ·City and County 0f San Francisco t.o a maximum of ~3 ... million, and of the City of San Diego to a maximum of $1 .. ""' 'million, if .said entities or 'either of them are parties to ·. 'this Compact' will 'sh'are..in the distribution of the net Proceeds. that are the subject of this paragraph on the ...'basis of 50~ of the. amounts of such transactions as verified by American '.or. Pipe Linings, Inc. within the said 13-year period. 42. Proceeds: Distribution of recoveries from Amyit..'.. AII: net proceeds, as'defined herein, of the liti- gation received from .defendant Amyit, whether by settlement'. or Judgment,.. shall be.distributed exclusively to the party or parties who have .specifically asserted complaints and ~ . · .. causes of action against said defendant, in proportion to. the dollar value of t'he pipe acquisition. transaction of each such' party, determined or verified in such manner .as may be agreed in writing by all of'said part'ies partiCipatin~.".' . in this distribution.. ':'. '.... ~ ... 43. PrOceeds:- P_artial distr. ibUtion. No partial or interim distribution of proceeds of any 'settlement or Judgment or any combination thereof shall be made except by formal ~5% vote of the parties. to.thisCompact. No such Partial or interim distribution shall be .made or calculated' until the parties shall have 'been reimbursed in the-amount of the assessmentS. previously p~id to the Finance 'Committee" for litigation expenses and until after special counsel fees and other major.. litigation expenses then due and owing.shall'.. have been 'paid,. or reserve for such payments has been set aside, The. sum'of. a'll partial or. interim distribut ion of'" ne.t" proceeds, as de'fined h~rein 'shall not exceed $5 million." . Part payments 'on ac'count of sp~cia! counsels,' fees should be made' as requested,' based upon the cash received and 12. available for such payments, having in mind the priority of payments specified in paragraph 40 above. In no event · shall·a to~al of more than $500,000 be paid special ·coUnsel until the termination of this litigation when all balances due shall be paid. 44·. Proceeds: ·Extraordinary and final distribution. Distribution of proceeds not accounted for by para~graph 43 above, shall be made only upon a 90~ formal vote at a WAPPO meeting, especially Called to consider extraordinaryor final distribution. Prior to any final distribution meeting, the Finance Committee shall take all steps necessary to arrange for the payment of all WAPPO obligations and the winding up of its fiscal affairs. Upon the completion of final distribution of all proceeds Of the litigation and the · rendering of its~final report by the Finance Committee, WAP·PO and this Compact shall terminate. 45. Execution: This Compact may be executed in counterpart by the parties thereto. IN WITNESS WHEREOF, the parties hereto have caused these presents to be subscribed by their representatives duly empowered so to do as of the day, month, andlyear hereinabove first ~written by subscribing these presents on the spaces provided on attached Exhibit "A, which is hereby made a part hereof. 13.