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  • Matthew Hirsch

Private Funds Used to Fight Public 'Nuisance'

Matthew Hirsch

Monday, April 10, 2006

Oakland City Attorney John Russo will be surrounded by a few hundred East Bay attorneys and other generous supporters at a fundraising event next Thursday that's supposed to bring in $150,000.

But the money isn't for Russo's state assembly campaign.

Instead, it's for Neighborhood Law Corps, an innovative organization Russo created and one he described as a legal services community nonprofit.

Now in its fifth year of existence, NLC is best known for its aggressive efforts to shut down "nuisance" liquor stores linked to high crime rates. The program has won acclaim for bringing city lawyers closer to the lives of city residents. But its efforts raise questions about private funding for code enforcement suits.

Based on current estimates, the April 20 fundraiser at the Oakland Marriot should have little difficulty meeting its fundraising goal, which would pay three attorneys' annual salaries at $40,000 a pop, plus benefits. Sponsors include large banks, a major construction company and prominent law firms such as Reed Smith, Sonnenschein Nath & Rosenthal, Hanna, Brophy, MacLean, McAleer & Jensen and Kazan, McClain, Abrams, Fernandez, Lyons, Farrise & Greenwood. Wendel, Rosen, Black & Dean is organizing the event, which in past years has drawn Robert F. Kennedy Jr. and Erin Brockovich as keynote speakers.

NLC executive director Alex Nguyen said public officials from San Francisco, Santa Rosa and other cities have approached him about work performed by NLC, but few cities have shown interest in replicating the program.

"It's a pretty 'out-there' thing to do," Nguyen said of the law corps' public-private model. "Conceptually, it's just not the way government [traditionally works]."

Nevertheless, the organization was recognized last October with an excellence award from the League of California Cities, and to date, its attorneys claim to have shut down 64 drug houses and eight "nuisance" liquor stores, each identified by community members as a magnet for serious crime.

It has hauled another 22 liquor store operators into administrative hearings to force conditions on those businesses that the city believes will help discourage crime, such as increased surveillance, improved lighting and restrictions on the sale of fortified liquor.

"Not one of these cases is a store that would be permitted to operate in Walnut Creek," said Russo, who insists that law corps attorneys go after only the most serious "nuisance" stores, the ones with a record of repeated code violations and the highest concentration of crime.

But that hasn't shielded Russo from criticism.

Edward Higginbotham, a San Francisco attorney who represents more than a dozen liquor store owners, said the NLC is preying on a vulnerable population of mostly Middle Eastern merchants who are less inclined to hire a lawyer than most business owners.

"To be fair, I think it started off with good intentions. But it's sort of evolved into this sort of political weapon," he said.

Once a liquor store is targeted by the law corps, Higginbotham said, NLC attorneys quickly threaten legal action unless the store owner agrees to the city's demands.

"They bring you into a room with about two police officers and two attorneys. They tell you about all the crime that's going on in your neighborhood, and they tell you you've got to clean it up," said Higginbotham. If the store owners don't sign an agreement with the city, they face a hefty fine, plus a $5,000 filing fee to proceed with an administrative hearing, he said.

Higginbotham said his presence at least puts the city on notice that there's another attorney in the room, but he admitted he's had limited success going up against NLC. He said the law corps targeted one of his clients, Akrem Alazzani, even after Alazzani helped the city close M&W Liquors in east Oakland.

"The way they're going about it is wrong," said Higginbotham. "[Alazzani] did a favor for them, and they basically turned around and told him you got to do this or else."

On the whole, Russo is unapologetic about the law corps' aggressive approach toward "nuisance" liquor stores. He said the law corps only threatens to shut down a store as a last resort.

"Our slogan has been, 'We'll turn you around, or we'll shut you down,'" Russo said.

But the city attorney characterized Alazzani's situation differently than Higginbotham. He said Alazzani willingly agreed to operate his store, called Orlando Market, under the city's conditions.

"Orlando Market is a voluntary compliance. He did the right thing," Russo said of Alazzani. "Now, if he has buyer's remorse, I'm sorry about that."

As for the claim that the law corps serves a political purpose, Russo said the nonprofit foundation that oversees NLC funding acts as an independent check against political influence.

Perhaps a larger concern is the potential conflict created by a public code enforcement effort largely funded by lawyers from the private sector. The concern is that targets of the law corps may hire NLC funders in hopes of making their code enforcement problems disappear.

Legal ethics expert Richard Zitrin, of Zitrin & Mastromonaco, said attorneys at many small firms like his turn down business that's inconsistent with their values. Attorneys at large firms can adopt the same standard, he said.

"Many lawyers and many law firms wear multiple hats. One hat is funder. Another hat may be counsel for questionable liquor stores. I would be very happy to see law firms wearing one hat," Zitrin said.

Zachary Wasserman, a long-time partner at Wendel, Rosen who serves as event chairman for the April 20 fundraiser, said NLC "seemed to absolutely fit the bill" when Russo first asked the firm for support four years ago. And Wasserman said he hopes the program will continue even if Russo gets elected to the state Assembly.

While expressing support for NLC's accomplishments, Wasserman acknowledged the concern about representing targets of the law corps, calling it "an uncomfortable situation."

"That's always a possibility, but it is not in any sense a true conflict," Wasserman said. "I think, generally speaking, our firm and any of the funders try to keep an eye out for that."

Wasserman said he doesn't think Wendel, Rosen has encountered the situation yet, but "I think it came close."

Russo said he's not aware of any NLC funders that have represented targets of the law corps. And if a firm were to make a habit of it, Russo said, "I wouldn't take their money any more."

Russo said he hopes NLC exists in Oakland long after he leaves the city attorney's office — whenever that may be.

"Whoever follows me, why wouldn't they keep Neighborhood Law Corps?" said Russo, whose first job out of law school was for the Legal Aid Society, where he took home "about $227 per week."

The NLC, he said, "is the single most direct, selfless program that city government has put together."

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