HomeMy WebLinkAboutContract - 06/13/2023 - 2048 Li
Pillsbury Winthrop Shaw Pittman LLP
11682 El Camino Real,Suite 200 I San Diego,CA 92130 I tel 858-509-4000 I fax 858-509-4010
Marcus Wu
tel:+1.858.509.4030
marcus.vvu@pillsburylaw.corn
June 13, 2023
Via Email
Anne V. Ambrose
Assistant City Manager
Cathedral City
68-700 Avenida Lalo Guerrero
Cathedral City, CA 92234
Dear Anne:
This letter confirms that Cathedral City ("you") has engaged Pillsbury Winthrop
Shaw Pittman LLP to advise and represent you in the matter described below and
provides the terms and conditions of our engagement.
1. Scope of Erwagement and Fees. You have asked us to represent you in connection
with employee benefits and tax advice.
Our billing policies and procedures, rates, charges for disbursements, and other
standard terms of engagement are provided in the Addendum to this letter.
2. Identity of the Client. Unless agreed otherwise in writing, Cathedral City will be
our sole client in this engagement and we will not be representing any of your
affiliated or constituent individuals or entities, such as any parent or subsidiary
companies, directors, officers, founders,managers, general or limited partners,
employees, members, or shareholders. Because we do not represent any of these other
entities or people, we may be adverse to them without seeking a consent or waiver
from you.
3. Pillsbury Marketing. You agree that we may list you as a client in our marketing
materials and note the general nature of the matters where we have represented you.
We will of course preserve any confidential infor-nation obtained during the course of
our engagement.
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Anne V. Ambrose
June 13,2023
Page 2
4. Advance Conflicts Waiver. Pillsbury is an international law firm that represents
many different clients with diverse interests. Many of our clients conduct business or
compete with one another. Our website, www.pillsburylaw.com, describes the types
of clients we represent, the locations where we practice, and the matters we typically
handle. In particular, our Firm's State and Local Tax, Environmental, Real Estate,
IP/Licensing, and Health Care practices are frequently adverse to government entities
-- including state and local governments, agencies, commissions, and the like
("Government Entities") in transactional matters and disputes in various forums.
In the future,we may be asked to represent a party in a transaction or a dispute that is
adverse or potentially adverse to you or an affiliated government entity, or to
represent you where an adverse party is another client of our firm, where that
transaction or dispute is unrelated to the matter involved in this engagement. Under
the rules of professional conduct for lawyers in many of the jurisdictions where we
practice, we may be precluded from representing a current or new client in a matter
adverse or potentially adverse to you, even though that matter is unrelated to this
engagement for you, unless we have a conflict waiver from you and the other client in
advance that we may do so. Similarly, under the rules of professional conduct for
lawyers in many of the jurisdictions where we practice, we may be precluded from
representing you in a matter adverse or potentially adverse to another client of our
firm, even though that matter is unrelated to our work for that other client, unless we
have a conflict waiver from you and the other client in advance that we may do so.
We ask that you consent to or waive the conflicts of interest associated with our
representing parties that are adverse to you in transactions and disputes so long as the
matters are unrelated to our work for you. In addition, we ask that you consent to or
waive the conflicts of interest associated with our representing you on transactional
and dispute engagements where adverse parties are also clients of ours on matters
unrelated to the engagement for you. You further agree that with respect to
transactional matters for you, we need not give you notice that adverse parties are
Pillsbury clients unless you specifically ask us whether an adverse party is a client of
ours. With respect to disputes,we will advise you if the adverse party is a Pillsbury
client. We will not undertake any such representations unless we have a reciprocal
waiver from the client that is adverse to you.
Your signature on this letter confirms that you do consent and agree that we may take
on such matters and that you waive any conflicts that such a future representation
might present to the extent such consent and waiver may be required under applicable
laws. We will preserve at all times your confidences under applicable rules of
professional conduct and this advance waiver does not affect that obligation. You
also acknowledge,by signing this letter, that you have had the opportunity to consult
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Anne V. Ambrose
June 13, 2023
Page 3
with other counsel about the consequences of granting this advance waiver and our
position on conflicts of interest and that we recommended that you do so.
5. Additional Conflict Information. We also request your acknowledgement that
you agree with us that it is not a conflict of interest under the applicable rules of
professional conduct for us, in connection with funding opportunities, contracts or
merger and acquisition transactions and related financing matters,to represent, using
separate teams (commonly referred to as "trees") that maintain information barriers
between such teams about these representations (except as may be agreed in respect
of any particular subject such as, for example, shared expert diligence and a shared
common or"neutral"diligence team), to represent competing applicants, bidders
and/or advisors and financing sources for competing bidders. We, of course, will not
accept an engagement from more than one client in such situations unless we believe
that such additional representations will not have an adverse effect on the exercise of
our independent professional judgment. In connection with our representation of you
or other clients in such competitive situations,we will not advise you about the merits
of any of our other clients' competing applications or bids or challenge on your behalf
the applications or bids of or any awards to other of our clients. Your signature on this
letter also confirms that you agree with this as to any current and future such
transactions and, to the extent that there is in fact a conflict of interest under
applicable rules of professional conduct arising from such multiple representations,
you waive that conflict.
6. Termination or Withdrawal. Unless otherwise agreed in writing, this engagement
will terminate if no services are provided by us for a six-month period, except where
we are awaiting an action or decision by a court,tribunal or agency, or specific
actions are necessary to complete the engagement that extend beyond the 6-month
period.
You may terminate this representation at any time, with or without cause, by
providing written notice to us.
We have the right to withdraw from representation of you subject to applicable rules
of professional conduct. Before withdrawing we will discuss with you any steps
necessary to protect your interests in any ongoing matter including transfer to other
legal counsel.
The termination or withdrawal of this engagement will not affect your responsibility
to pay for services rendered and charges incurred on your behalf.
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Anne V. Ambrose
June 13, 2023
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7. Arbitration of Disputes. If you disagree with the amount of our fees or other
charges,or if you have any concerns about our work for you,please bring that to our
attention as soon as possible. In the event any dispute between us arising from or
relating to our work cannot be resolved informally, we both agree to forego the right
to trial by jury and to resolve any disputes between us, or any disputes you have with
any of our lawyers or staff, including but not limited to disputes over fees and
charges, exclusively through private and confidential binding arbitration before
JAMS, or another arbitral body if mutually agreed. The arbitration will be governed
by JAMS Comprehensive Arbitration Rules and Procedures, conducted before one
neutral arbitrator for any dispute where the claim is less than$300,000 or before three
neutral arbitrators for any larger dispute, and the arbitrator or arbitrators will be
authorized to award any damages or relief that a court of law having jurisdiction over
the dispute could award. Any award may be enforced in any court with jurisdiction.
You acknowledge by signing this letter that you have had the opportunity to consult
with other counsel about the consequences of agreeing to binding arbitration and that
we recommended that you do so.
To the extent that New York rules would apply to a dispute between us that cannot be
readily resolved, you may have the right to request non-binding arbitration in New
York City under Part 137 of the Rules of the Chief Administrator of the Office of
Court Administration of the New York State Unified Court System or under
applicable bar association procedures. By signing this engagement letter, you
expressly waive that right and agree to binding private arbitration as provided above.
8. Internal Communications. There may be instances where our lawyers and staff
find it useful to communicate about their professional obligations with inside or
outside counsel for our firm. For example, we may need to determine if a new
representation of another client would present a conflict of interest because of our
work for you, and if so, the form of waiver required. Another example is where a
dispute occurs between you and our firm. You agree that if our lawyers or staff have
communications with our inside or outside legal counsel about our work for you, we
have your consent to do so, and such communications will be deemed confidential
and protected by our firm's attorney-client privilege. Our representation of you shall
not waive such privilege and you agree that we will not be obligated to disclose such
privileged communications.
9. Additional Engagements. If you request and we agree that our firm undertake
additional engagements for you, or represent any of your affiliates,we will do so on
the terms and conditions set forth in this letter unless otherwise mutually agreed in
writing.
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Anne V. Ambrose
June 13, 2023
Page 5
10. Review and execution. Please review this letter carefully and let us know if you
have any questions. Please note that if, after receiving this letter explaining the terms
of our representation of you, you accept any of our services for this engagement and
do not first object to the terms contained in this letter, we will deem you to have
accepted all the terms set forth in this letter. We nonetheless ask you, if these terms
are acceptable, to please sign and return the enclosed copy, keeping a copy for your
files.
We are pleased to have this opportunity to be of service and we look forward to
working with you on the engagement.
Sincerely,
Marcus Wu
Partner
Accepted and agreed to:
ByiL
Charles McClendon, City Manager
7
Dated: — — -)
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ADDENDUM
BILLING AND DISBURSEMENTS
1. Our Billing Policies and Procedures. Our fees are based on the number of hours devoted to
this engagement. The current rates for our attorneys and paralegals who will work on your
matter are as follows:
Attornev/Paralea al Name i Rate
Marcus Wu/Partner $810
Jennifer Wong/Associate $605
From time to time, it may become necessary or desirable to assign different or additional
attorneys,paralegals or document production professionals to work on your matter. The rates for
document production professionals may range from $60 to $125 USD per hour depending on the
complexity of the assignment.
Our standard hourly rates are adjusted periodically to reflect the advancing experience,
capabilities and seniority of our professionals as well as general economic factors. We will
provide you with notice of any adjustment in rates for professionals working on your matter.
Fees generally will be billed within 30 days of the month in which the services are rendered, and
disbursements and other charges will generally be billed within 30 to 60 days after they are
incurred by us. Payment is due upon your receipt of our statement.
Incidents of criminals hacking into email systems and then using spoofed emails to impersonate
a legitimate sender are on the rise. These schemes are most often used to fraudulently misdirect
wired funds in connection with a transaction or other payment. In an effort to avoid being
victimized, Pillsbury strongly encourages you to implement the following standard practice:
whenever you receive new payment instructions from any source, you should independently
verify that the new instructions are correct using previously verified contact information. In the
case of emails that purport to be from Pillsbury, we ask that you telephone your relationship
partner or his or her assistant to confirm that the instructions have actually come from Pillsbury,
and that they are correct. It would be extremely rare for you to receive a legitimate last-minute
email from Pillsbury altering previously agreed upon wire transfer instructions. We appreciate
your partnership in this important effort.
The timely payment of our statements is important to us and a critical part of our engagement. If
a bill is not paid within 35 days following the date of the statement, you agree that interest on the
full amount thereof at the rate of 1%per month will also be due. Interest will commence to run
on the 35th day following the date of our statement for all unpaid amounts. Payment of interest
does not waive or limit our rights to withdraw from representation for failure to make timely
payment of statements when due.
2. Estimates of Fees and Expenses. Any estimates of anticipated fees that we provide at your
request, whether for budgeting purposes or otherwise, are only an approximation of what the
actual fees will be. Unless we have otherwise agreed in writing, any such estimate is not a
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maximum or minimum fee quotation, and our fees will be determined based on actual hours
incurred as provided above.
3. Disbursements. In the course of our engagement, we will use our normal support systems. In
addition to our fees for legal services, we will charge separately for certain costs, expense
disbursements and taxes, as applicable. A list of our standard charges that may be incurred
during the course of the engagement is set forth below.
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PILLSB Y WINT l'OP SHAW PITT • LLP
DISB 'SEMENT C • 'GE ' • TES -USD
as of 0E01/2023
DISB •SE NT/EXPENSE* CLIENT C • 'GE BASIS
Computer
Litigation Support Data Hosting charges $20 per GB per month
Computer Research(LexisNexis and Westlaw),etc. Charged based on standard vendor rates per search,less a
discount of 30%on Westlaw and LexisNexis searches,plus
the hourly rate of the person conducting the search.
Document Preparation
Convenience Copies, Printing,Scanning $0.19 per page—Black and white
$0.44 per page-Color
Copy Center Reproduction and Printing(Photocopies, $0.15 per page(for jobs under 3,500 counts)
scans, images,etc.) $0.10 per page(for jobs of 3,500 counts or more)
Oversized Copies $0.75 per page
Color Copies $0.40 per page(for jobs under 3,500 counts)
$0.35 per page(for jobs of 3,500 counts or more)
Document Binding(Briefs,formal presentation $1.25 per binding
documents,etc.)
CD Burn $5.00 per burn
DVD Burn $7.50 per burn
Tabs $0.20 per tab
Litigation Preparation(Copying,scanning,etc). $0.10 per page(light)
$0.12 per page(medium)
$0.15 per page(heavy)
$0.19 per page(glass work)
* There is no charge for postage,faxes or domestic and international phone calls
1 All other expenses incurred and paid for by the firm on behalf of clients,including express courier service,court services,catering,equipment rental,third party
conference calls,cell phone expenses,etc.are charged at cost. Disbursements for large vendor invoices(over$5000)will be forwarded directly to the client for
payment. Alternatively,if the client prefers to have the firm pay the vendor for large invoices and include the disbursement on the next client bill,the firm will
do so if the vendor agrees to defer payment of their invoice until the client pays the firm.
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For matters involving patent work,we do not handle the payment of maintenance fees or
annuities on granted United States or foreign patents. If you do not already have an arrangement
for handling these payments, we suggest you consider engaging Computer Patent Annuities
("CPA") or another similar vendor to handle monitoring and payment of your annuities. CPA,
which has no affiliation with us, presently handles approximately 1,000,000 renewal payments
each year and has relationships with patent and trademark offices in every country in the world.
Of course,you can attend to these payments yourself rather than make use of a vendor, but we
recommend against doing so. Please inform us as soon as possible which vendor you currently
use or plan to engage for payment of maintenance fees and annuities on granted patents.
4. Electronic Discoveiy,Activities and Charges. In the event that your matter involves
processing, reviewing and/or producing documents, we may,with your approval,provide certain
eDiscovery services to support these activities, including processing of electronic data for
culling, analysis and review, hosting of electronic files and databases in one of our eDiscovery
platforms ("eDiscovery databases"), assembling and distributing document and data productions,
or performing related analytics,technical services and project management tasks. We may also
perform research activities on your eDiscovery databases to improve productivity or provide
analytic results or insights, consistent with our confidentiality obligations to you.
Our Litigation Support Department maintains resources within the firm's network to facilitate
eDiscovery projects, as an alternative to using a third-party vendor or consultants for these
services. If you elect to use our Litigation Support Department, you will be charged fees for
eDiscovery services at hourly or unit-based(e.g.,per-gigabyte or per-document) rates,
depending on the nature of your project and the type of eDiscovery services we perform. This
includes monthly hosting charges based on the volume of eDiscovery databases maintained in
our platform on your behalf.
You agree to pay for eDiscovery services performed by us in connection with this engagement,
regardless of the outcome of your matter. You authorize us to delete your eDiscovery databases,
upon 10 days written notice of our intent to do so, at the conclusion of any eDiscovery project, or
upon the termination of this engagement. You further authorize us to take your eDiscovery
databases offline if you fall behind on payments to us and agree that we are under no obligation
to continue hosting your eDiscovery databases or providing access to them if your account is not
current. You also agree that you are entitled to receive a copy of your eDiscovery databases, but
only upon written request received by us prior to their deletion, subject to our ordinary hourly
rates and media charges and provided your payments to us are up to date.
5. Communications, Files and Subpoenas. In working on the engagement, we will preserve
communications and documents in either hard-copy or electronic form, depending on the
circumstances, as reasonably necessary to represent you. As described below, some of these
files belong to you("Client Files") and some belong to us. The Client Files consist of those
electronic and hard-copy documents that are kept in the central file that we maintain for each
client matter. Before we transmit the Client Files to you at your request, we will remove
administrative documents,purely internal correspondence and drafts of documents or
memoranda that we may prepare but do not transmit to you.
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In the event we are required to respond to a subpoena or other formal request for records or other
information relating to our services for you, including testimony at a deposition, we will consult
you before responding to determine if you want to supply the information demanded and/or
assert the attorney-client or other privilege that may apply. You agree to reimburse us for the
time and expense for responding to such demands, including,without limitation, the time and
expense for searching, locating, reviewing and copying responsive information, appearing at
depositions or hearings, and litigating any issues raised at your request.
At the completion or termination of this engagement,you may request in writing the return or
disposal of the Client Files. In order to collect and prepare the Client Files for delivery or
disposal, we likely will need to spend time and incur expense. You agree to pay us at our regular
rates for this time and pay any necessary disbursements. We will give you an estimate of our
expected charges promptly after receipt of your written request for transfer or disposal of the
files. In our discretion we may make and keep a copy of any Client Files being returned or
disposed of at our expense.
If you do not request return of the Client Files, we will maintain them for a period of five years,
after which time you agree that we may dispose of them in a confidential manner. Prior to
disposal of the Client Files, we will advise you in writing, at the last known address in our files,
of our intent to do so in order to give you an opportunity to request the materials. We may
dispose of our own files at any time without notice to you.
Please also note that if electronic communications are sent or received by you on a computer or
other device that may be accessed by third parties, the privilege protection that such
communications with us might otherwise be afforded may be lost. We therefore strongly
encourage you not to use such a device when communicating with us. Please also note that our
records may be accessed electronically by all our offices and that we may store records using
"cloud computing."
6. Non-legal Services. Because we are a law firm, we provide only legal services. In the
engagement we will not provide any investment, insurance, accounting or technical advice, make
business decisions, or investigate the character or credit of those with whom you may be dealing.
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Anne Ambrose
From: Wu, Marcus <nnercusmm@ Ulsbu m>
Sent: Friday,June 9' 2U232:49PK4
To: Anne Ambrose
Subject: Engagement letter
Attachments: Cathedral City Engagement Lettar.docx
Hi Anne,
Attached is our engagement letter. if you approve, please sign where noted and email a copy of the signature to me.
Below are short work descriptions of the 401(a) project and the COVID project, including a fee estimate for the former,
401(a) proiect
As discussed, under the tax laws,the City's 401(a) plan generally cannot accept voluntary employee contributions of
employees'City pay.
But under a limited exception, the plan may permit a voluntary employee contribution if(i)the election is irrevocable;
and (ii)the election is made before the date the electing employee becomes eligible for any City-sponsored retirement
plan, including PERSora4S7(b) p|an.Treas. Reg. §1.401/h\-1(a)(3)(v).
I understand that the City's 401(a) plan recently accepted employee contributions that didn't satisfy the above
requirements. In tax parlance,this oversight constitutes an "operational failure,"which exposes the plan and City to
substantial tax risks.
We would advise the City on its options for correcting the failure and minimizing(or averting)the tax risks. Generally,
the appropriate correction is to file a submission (known as VCP) under the IRS's correction program for operational
failures(known ayEPCRS).TheVCP submission would include a detailed description mf the error; description of steps
that the City has taken to ensure the error won't repeat; and a proposed correction method. We've worked with other
public agencies on correcting errors identical to those involved here,with successful outcomes.After receiving and
approving the submission,the IRS would issue a "compliance statement,"forever shielding the City from any tax liability
for the errors.
Our legal fees for completing the above steps, including the VCP if the City decides to take that path,would range from
/S7C5 '''
CCN|Dproje�t
Since March 2020,to comply with various federal and state laws,the City has provided paid leave to employees who
needtinnemfffVrcertainCOV|D-re|atedreasons("COV|D|aavepayments"). Undera |itt|e-advertioedfedera| |am\the
City is entitled to recover federal funds—Le., refunds—for COVID leave payments made to employees for eligible leaves
in the 2"u u and 3' quarters of 2021.The refundable amounts encompass not only the leave payments up to certain limits,
but also certain related pension, health,and FICA costs incurred by the City.
Presuming the City hasn't yet recovered those refunds,we'd love to help.Would it be.possible&o email rmeasummary
total mfthe CUy"stotol COVUD leave payments fx 2Q and 3Q or2021?With these figures, |can advise nn whether it
makes economic sense to pursue the refunds and provide a fee estimate for assisting the City.
1