Peggy reacted with joy, clasping her hands in delight and shouting, “Good! I won’t have to wash dishes here every night.”
Conway fumbled with the coffee pot, and then he set it down suddenly. “It’s been five long years,” he said in a hoarse voice, and tears came to his eyes.
Peggy came over to him and put her arms around him. They stood for a moment in the embrace. “In the next few minutes, it’ll be all over,” she said.
Schlichtmann emerged from his office and came toward the kitchen. “He’ll give me eight. He won’t give me any more than that. He says it’s extortion.”
Gordon was tapping out figures on the calculator. Schlichtmann peered over Gordon’s shoulder for a moment. “All I want are my suits from Dmitri, my condo, and a trip to Hawaii,” said Schlichtmann. “And forty thousand in cash. No, keep the cash and get me a credit card for Hawaii. A platinum credit card.”
“No,” said Gordon.
“I must have my dignity,” said Schlichtmann.
“What’s wrong with a fucking Mastercard?” said Gordon. “What do you estimate your bill on the platinum will be after one month in Hawaii?”
“Just put me back to where I was two years ago,” said Schlichtmann. “Make me whole again.”
“How do you plan on paying the credit cards when they come due?”
“I’ll be settling cases again,” said Schlichtmann.
Blindman’s Buff
1
Judge Skinner gave his blessing to the eight-million-dollar settlement on Monday morning, September 22. The Woburn jurors, summoned that morning by the judge’s clerk, waited upstairs in the jury room, expecting to begin the second phase of the trial.
In his chambers the judge said to Schlichtmann, “We’re talking about many hundreds of thousands of dollars for each one of these families?”
“Yes,” replied Schlichtmann.
“I think this is quite a successful settlement,” said the judge, “certainly from the plaintiffs’ point of view. There was a good likelihood they would have ended up with nothing at all, given the extremely difficult nature of the evidence.”
Schlichtmann made no reply.
The last two weeks had been difficult for Schlichtmann. Keating had made many demands on behalf of Grace. There would be no deal, Keating had said, unless the judge granted Grace’s motion for a new trial and rendered the verdict null. Furthermore, it had to appear as if the settlement had come about only after the judge declared a new trial. This petty deception irked Schlichtmann, but he went along with it. He had little choice. He suspected the judge was going to order a new trial for Grace anyway. He became certain of that when the judge readily adopted Keating’s fictitious chronology.
“There never was going to be a second phase,” Schlichtmann told Conway bitterly. “The judge was going to fuck us all along. We got the money an hour before everything turned to dust.”
The case against W. R. Grace officially ended as it had begun—in front of a crowd in Judge Skinner’s courtroom. The judge informed the jurors of the settlement and thanked them for their service. A moment later reporters surrounded Schlichtmann and Keating, seeking details of the settlement. Keating had insisted, as another condition of settlement, that the amount paid by Grace be kept secret, and Schlichtmann had consented to this. But many people, including of course the families themselves, knew the sum, and by evening the network news programs would be citing a “reported” eight-million-dollar settlement.
Out in Woburn that afternoon, at Trinity Episcopal Church, Schlichtmann proclaimed victory in front of the television cameras and a crowd of onlookers. His clients, seated on folding chairs in a semicircle before the cameras, made similar statements. Several expressed their conviction that, in Donna Robbins’s words, they had “set out to teach corporate America a lesson,” and they had succeeded.
Not everyone at Trinity Episcopal believed that, not even some of those most favorably disposed to the families’ cause. From the back of the church hall, Reverend Bruce Young watched the proceedings and said bitterly, “I’ll bet they’re having a wonderful party at Grace headquarters today.” He’d been furious—“bullshit mad,” as he later put it—when he heard that morning about the settlement. He felt he’d invested a lot of himself in this matter, and to him taking Grace’s money without a full disclosure by the company, or any expressions of atonement, cheapened everything. The way he saw it, the case had started out as a matter of principle. He recalled Anne Anderson saying once that she wasn’t after money, that what she wanted was for J. Peter Grace to come to her front door and apologize. As far as Reverend Young was concerned, Schlichtmann had botched the first part of the trial—the easy part—and then he’d sold out when things began to look risky. Even worse, thought Young, was the way Schlichtmann was now using his lawyerly powers of persuasion to convince the families that they’d actually won something. The entire affair disgusted the minister. “This was a case I thought would have some real importance,” he said. “It never happened.”
Among the families themselves, there was trouble. Schlichtmann always said that once money was put on the table, things would turn ugly. And now the ugliness began, although not in ways he had anticipated. A few days after the press conference at Trinity Episcopal, the families met in Schlichtmann’s office to discuss the division of money. Schlichtmann informed them that each family would receive $375,000 in cash and, five years later, another payment of $80,000. The case expenses amounted to $2.6 million. And the legal fees came to $2.2 million. This, Schlichtmann pointed out to the families, was only 28 percent of the total settlement, less than the 40 percent fee they’d agreed to when they’d signed the contingency forms.
No one voiced any complaint at that meeting. But afterward, as Donna and Anne drove home to Woburn together, Anne expressed anger at the size of Schlichtmann’s fee. She didn’t think the lawyers should get more than any one family.
Donna said, “I think Jan deserves it. He did all the work. All we had to do was go to meetings.”
“He hasn’t lost a child,” replied Anne.
“I hope he never has to go through that,” said Donna.
Anne didn’t say any more that night, but the matter did not end there. In recent months Anne had begun to resent Schlichtmann. She found his manner with the families patronizing, as if he were talking to a group of children. There would have been no case had it not been for her efforts, and yet she felt as if he had systematically excluded her and the others from important decisions. Whenever she ventured an opinion that differed from his, he would always say, “Trust me, trust me.” How many times had she heard him say that? It galled Anne, but what bothered her most was a growing conviction, now that the trial was over, that he didn’t really care at all about her or the others. She came to believe that he’d been using them simply as a vehicle for his own ambition, for his own fame and fortune. “I was doing this for my baby, for Jimmy,” she explained later. “It started out in a pure manner. We didn’t want what happened to us to happen to anyone else. But by the time I got through dealing with Jan, I felt violated. The lawsuit made me feel dirty.”
She insisted that she didn’t really care about the money. But Schlichtmann, she believed, cared a lot about it. And if money was important to him, she decided that she would make it important to her. She found a receptive audience with the Zona family, whom she’d known for fifteen years now.
Anne and the Zonas could not challenge Schlichtmann on the matter of his fee since they had signed a contract entitling him to 40 percent of the recovery. But they could dispute some of the $2.6 million that Schlichtmann had claimed in expenses. When they raised this issue, Schlichtmann suggested they hire an accountant to go through the thousands of invoices. They took him up on the invitation. The accountant questioned copying fees, interest charges, overtime expenses, and sundry other matters. Anne and the Zonas hired a lawyer to represent them. Ronald Zona called Donna Robbins one night to enlist her support. He told Donna tha
t Schlichtmann had stolen half a million dollars from them.
“How did he steal it from us?” asked Donna. “Where did it come from?”
Ron Zona said, “It came out of expenses we never should have paid for.”
“Jan never asked us for any money,” replied Donna. “None of us ever put up anything. I don’t feel you’re right.”
Schlichtmann told the families that he would not dispute the accountant’s findings. He agreed to remit whatever sum the accountant deemed appropriate. The accountant submitted a list that came to eighty thousand dollars. Schlichtmann was prepared to divide this sum equally among the families, but none except Anne and the Zonas would accept any of the money.
Schlichtmann had indeed been lavish with the expenses. That had always been his way. He’d never spared any cost in preparing a case, and in Woburn there had always been another well that could be drilled, another medical test that could be performed. Yet he had not come close to matching the seven million dollars in legal fees and costs that Grace had paid for its defense, not to mention the additional millions paid by Beatrice.
As it turned out, the expenses as billed didn’t begin to cover the true costs of the case to Schlichtmann’s firm—the salaries and benefits paid to the secretaries, associates, and paralegals, the overhead and day-today costs of running an office. In normal times these would have been paid for out of the proceeds of half a dozen major cases every year. But Woburn had occupied everyone in the firm virtually full-time for the past two years. Among the lawyers, the largest single beneficiary was Joe Mulligan, the one who had first gone out to Woburn and signed up the families. For the price of a drink at the Littlest Bar and some blandishments five years earlier, Mulligan had gotten Schlichtmann to take over the case. Now he demanded a referral fee. Schlichtmann balked. Mulligan, after all, had put in less than a week of effort on the case. Mulligan filed a lawsuit in Superior Court. To settle the lawsuit, Schlichtmann agreed to pay Mulligan three hundred and fifty thousand dollars.
Meanwhile, Trial Lawyers for Public Justice was seeking $648,000 in fees for Anthony Roisman’s early assistance. Schlichtmann met with Roisman and his board of directors at a hotel airport outside Chicago. Gordon and Phillips came along. The meeting lasted all day. The board told Schlichtmann that he had mismanaged the case, that he had spent too much and settled for too little. Phillips walked out of the meeting in disgust. Gordon broke down and wept angry tears. The woman sitting next to Gordon, a personal injury lawyer from California, turned to him and said coldly, “It’s nothing personal, you know.”
Schlichtmann refused to say much in his own defense. But he could not pay Trial Lawyers for Public Justice the full fee he owed them by contract. In the end, they agreed to accept three hundred thousand dollars.
Over dinner one night Phillips asked Schlichtmann if he regretted taking on the Woburn case.
“Do I regret it?” exclaimed Schlichtmann with a harsh laugh. “Does a paraplegic regret the moment he stepped off the curb and the bus ran him down? The case has ruined my life.”
Creditors lurked everywhere. Gordon began settling the debts, including the million-dollar-loan from Uncle Pete. Once everyone else—Nesson, Kiley and Tom Neville, Gordon and Phillips—had gotten paid, and a hundred thousand dollars in bonuses had been distributed among the office staff, Schlichtmann ended up with only thirty thousand dollars. He was debt-free, but there was no money left over for him to reclaim his Porsche. Nor could Gordon get him any new credit cards—Schlichtmann had destroyed his creditworthiness. Conway and Crowley, with less debt than Schlichtmann, came out of the case with a hundred thousand dollars apiece. They got the deeds to their houses back. Conway tried to make amends to his wife by buying her a fur coat for Christmas and a camcorder to film their children.
Conway would not learn the full scope of the disaster that was about to befall them until the new year. Gordon had not paid all the debts. Gordon had not set aside any money to pay taxes.
2
Schlichtmann departed in December for a monthlong vacation in Hawaii. While he was gone, the EPA issued a report on the pump test of Wells G and H that it had conducted one year ago, before the start of trial. The agency’s experts concluded that both Grace and Beatrice were responsible for contaminating the Aberjona aquifer and the city wells. At a public hearing in Woburn, the EPA administrator in charge of the project stated that the Beatrice land was the most grossly contaminated area in the aquifer, and by far the largest contributor to the pollution of the wells.
By these lights, the Woburn jury had made a mistake. Groundwater from Beatrice’s fifteen acres had gotten under the river and had contaminated the wells, as Schlichtmann’s expert had claimed. Given the proximity of the fifteen acres to the wells—a mere three hundred feet—this should have been obvious even without the EPA report. On the face of it, the verdict appeared to stand as an example of how the adversary process and the rules and rituals of the courtroom can obscure reality. But in Schlichtmann’s view, it was the judge who had led the jury astray.
From the beginning, Skinner never seemed to regard the case against Beatrice in the same light as the one against Grace. After the trial the judge had made some additional findings. He had decreed that, based on the evidence, groundwater from the fifteen acres had never reached the Woburn wells. Because of the compound nature of the questions the judge had posed to the jury, this specific question had never been answered. Skinner took it upon himself to answer it, and in doing so he made any appeal on the Beatrice verdict much more difficult. In effect, he was telling Schlichtmann that even if the jury had found against Beatrice, he would have overturned the verdict and entered judgment for Beatrice.
Polluted though the fifteen acres were, Schlichtmann had turned up very little hard evidence that Riley himself was responsible for its contamination. Perhaps that was the problem. Schlichtmann had never managed to find the witness who could break open the case, the way he’d found Al Love to expose Grace’s secrets.
Before leaving for Hawaii, Schlichtmann had promised the Woburn families that he would appeal the Beatrice verdict. Nesson had wanted to write the brief and make the oral argument before the U.S. Court of Appeals, and Schlichtmann had readily agreed. He was happy to go on to other things.
Returning to Boston, he began work on a difficult medical malpractice case involving a woman who had suffered a ruptured brain aneurysm. The firm needed some income, and quickly. The failure to set aside money for taxes had that most relentless of creditors the Internal Revenue Service dunning them.
The malpractice case failed to settle. In April, Schlichtmann and Conway went to trial. They’d spent thirty thousand dollars preparing the case, money newly borrowed from Uncle Pete. After a two-week trial the jurors began their deliberations. Schlichtmann paced outside the courtroom door. When the jury returned its verdict, four days later, Schlichtmann had lost. He wondered if he would ever win again. Bad karma from Woburn seemed to infect everything around him.
Schlichtmann and Teresa broke up around this time. They had been together for five years. If Schlichtmann felt sorry about the parting, he did not show it. “They can smell when the money’s gone,” he said, referring to women in general and the long-suffering Teresa in particular. It seemed then that he might let Woburn strip him even of his self-respect.
With no income to pay the bills, the firm’s debts once again began to mount. The deed to Conway’s house went back into Uncle Pete’s file drawer at the Bank of Boston. That spring the telephone at Schlichtmann’s condominium was cut off. To make calls, he had to go down to Charles Street, to the pay phone in front of the fire station. He shared the pay phone with a bookie, who was not happy with the new arrangement. They argued over how long each other’s calls lasted.
All of Schlichtmann’s furniture, except for one overstuffed chair, was repossessed. At night he would take the cushions off the chair and lay them on the floor to make his bed. When he needed a table, he would stack the cushions and sit o
n the floor before them, Japanese style. He dined in this position. He ate a lot of canned tuna. Kiley would sometimes take him out to dinner and slip him a hundred-dollar bill afterward.
Nesson had been working on the Beatrice appeal for several months now. He had outlined the procedural history of the case and crafted all the legal arguments against Judge Skinner’s directed verdict rulings, but he did not possess Schlichtmann’s command of the factual minutiae. He gave the brief to Schlichtmann and asked for his help filling in the pertinent facts.
Schlichtmann thought that Nesson had done a superb job. The brief was tightly reasoned and cited cases that perfectly supported its arguments. Best of all, Nesson had used the judge’s own words to show how Skinner himself had realized that he’d made a mistake on landowner liability and duty to warn.
Schlichtmann figured it would take him about three days to fill in the missing details. At first, poring over the trial transcripts was like opening a fresh wound. The more he read, the angrier he got at Judge Skinner, and the angrier he got, the more he became convinced that the families should win a new trial on appeal. The three days stretched to a week, and the week became a month. Conway would arrive at the office in the morning and find that Schlichtmann had already been there for hours.
Conway, however, remained skeptical of their chances. He urged Schlichtmann to work on other cases and not to place too much hope in the appeal. But Schlichtmann paid him no heed.
Schlichtmann filed the Beatrice appeal on Wednesday, June 7. The following Monday, he got a call from Neil Jacobs. Facher was in England, lecturing on American law at Oxford University, but Jacobs had just finished reading the appeal brief. He invited Schlichtmann over for a chat.
“It’s legal poetry,” Jacobs told Schlichtmann that evening. He offered to settle if Schlichtmann would withdraw the appeal. He suggested a sum of around two hundred thousand dollars, the amount that Beatrice would pay in legal fees to fight the appeal.
A Civil Action Page 51
