A nonprofit corporation created by the City of San Diego to carry out downtown redevelopment may not meet in closed session with legal counsel for the city’s redevelopment agency, the Fourth District Court of Appeal has ruled.

The ruling may not have widespread implications because San Diego’s system is uncommon; however, the ruling definitely could affect how San Diego does business. City Attorney Michael Aguirre, who was elected after the litigation at hand commenced, praised the court’s decision — even though his office lost the case. An outspoken advocate of open government, Aguirre told the Los Angeles Daily Journal that the decision “strengthens my hand in advising the city in the future.”

The city created the Centre City Development Corporation (CCDC) in 1975 to provide redevelopment services to the Redevelopment Agency of the City of San Diego. The city is the sole member of the CCDC and appoints the board.

Among the CCDC’s tasks are land acquisition and proceedings related to eminent domain filings. Although only the redevelopment agency is empowered to conduct condemnation actions, the CCDC is responsible for obtaining appraisals and negotiating with the owners of condemned properties. While trying to settle eminent domain cases, the CCDC Board of Directors has conferred with a law firm hired by the redevelopment agency to handle the eminent domain lawsuits. These meetings have occurred in closed session, pursuant to Government Code § 54956.9, a section of the state’s open meeting law, known as the Brown Act.

Melvin Shapiro, a San Diego civic watchdog, sued. Several years ago, Shapiro won a Brown Act case against the San Diego City Council regarding closed door meetings for the downtown baseball stadium and related projects. In Shapiro v. San Diego City Council, (2002) 96 Cal.App4th 904, (see CP&DR Legal Digest, May 2002), the court ruled that the council’s agenda descriptions of closed door negotiations were too general and some topics should have been discussed in public. In his lawsuit over the CCDC meetings, Shapiro argued that because CCDC is not a party to the eminent domain litigation, it must meet with the redevelopment agency’s counsel in open session.

San Diego County Superior Court Judge Richard Strauss ruled against Shapiro. Shapiro appealed and a unanimous three-judge panel of the Fourth District overturned the lower court.

Section 54956.9 provides a “pending litigation” exception to the Brown Act’s mandate that local government agencies convene in public. The statute defines “pending litigation” as litigation “to which the local agency is a party.”

The CCDC and redevelopment agency argued that because CCDC is an agent of the redevelopment agency, it has the same right as the agency to discuss eminent domain litigation in closed session.

That might be true if the normal attorney-client privilege applied. However, the court ruled, “according to the clear terms of § 54956.9, the general rules of attorney-client privilege do not apply to determine whether a meeting with legal counsel may be held in closed session. Instead a legislative body of a local agency is permitted to hold closed-session meetings with counsel to discuss pending litigation only as permitted by the terms of § 54956.9.”

The statute, the court continued, has no provision for the legislative body of one agency to meet in closed session with the legal counsel of another agency.

The CCDC leaned heavily on a 1984 opinion of the state attorney general (67 Ops.Cal.Atty.Gen. 111) that concluded an airport commission created by a board of supervisors may meet in closed session with county counsel about airport-related litigation in which the board of supervisors is a defendant. However, the court determined this opinion was irrelevant because the Legislature amended the key Brown Act provisions three years after the attorney general released the opinion.

The Case:
Shapiro v. Board of Directors of the Centre City Development Corporation, No. D045506, 05 C.D.O.S. 9899, 2005 DJDAR 13150. Filed November 22, 2005.

The Lawyers:
For Shapiro: Charles Wolfinger, (858) 272-8115.
For CCDC: Helen Holmes Peak, Lounsbery, Ferguson, Altona & Peak, (760) 743-1201.
For the San Diego City Council: Claudia Gacitua Silva, city attorney’s office, (619) 533-5800.