State Lost $75 Million, Boston Law Firm Finds $1.5 Million
Tuesday, June 22, 2010
In an effort to get back a pittance of the $75 million lost in the mismanagement of the state landfill, the state ended up brokering a deal that allowed a Boston-based law firm to walk away with $1.5 million, just four months after it was hired.
Last February, the state hired Boston-based K&L Gates to file an insurance claim to recover some of the money.
A Sept. 22, 2009 state audit had found that wrongdoing and negligence in the management of the landfill by the Rhode Island Resource Recovery Corporation had cost the state $75 million.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTAs a result of this audit, the Governor, General Treasurer, and Attorney General sent a joint letter on Jan. 28 to the former commissioners and some former employees of Resource Recovery, demanding the “immediate payment” of the $75 million in losses.
In response to those letters, Resource Recovery filed a claim with RSUI Indemnity Corporation, one of its insurance companies. K&L Gates handled the claim for Resource Recovery.
Last month, the state received a $5 million settlement from RSUI Indemnity—the maximum amount allowed under the insurance policy, according to Thomas F. Holt, Jr., a lead attorney for K&L Gates. His firm, however, received $1.5 million for its work, leaving taxpayers with $3.5 million.