09-1034Suspension 9/16/09
RESOLUTION
Presented by
Council File # 09-1034
Green Sheet # 3080016
1 WHEREAS, the City commenced Financial Industry Regulatory Authority Arbitration entitled The
2 city of St. Pau1 v. Merrill Lynch, Pierce, Fenner & Smith, Inc., File No. 08-04186, for claims for damages
3 for violations of securities law against Merrill Lynch arising from the sale of certain commercial paper to
4 the City; and
6 WIIEREAS, the Council appointed the law firm of Briol and Associates as Special Counsel for said
7 matter; and
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WHEREAS, through the course of litigation and in anticipation of an arbitration hearing set to
commence September 21, 2009, Special Counsel has negotiated a tentative settlement whereby Merrill
Lynch, Pierce, Fenner & Smith, Inc. will pay Nine Hundred Thousand Dollars ($900,000.00) to the City
and the City will convey back to Merrill Lynch, Pierce, Fenner & Smith, Inc said commercial paper, and
whereby the parties agree to share equally in any recovery on the commercial paper in excess of Nine
Hundred Thousand Dollars; and
WHEREAS, the Special Counsel, the City Attomey, and the Director of Financial Services all
recommend acceptance of the tentative settlement because it is in the best interests of the City to do so.
NOW, THEREFORE, BE IT RESOLVED, that the City agrees to the tentative settlement as stated
20 above; and
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22 FURTHER RESOLVED, the proper City officials are hereby authorized to execute any and all
23 agreements and other necessary documents to formalize a settlement consistent with the terms stated
24 herein.
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Adoprion Certified by Coundl Secretary
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Approved b a or Date
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Adopted by Council: Date ���(o/l/�
Requested by Depariment o£
09-1034
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-- FS —F�nanaal Services , �
CoMact Person 8 Phone:
Todd Hurley .
266-8549
Must Be on Councii Agenda by (Date):
23-SEP-09
)oc. Type: RESOLUTION
E-AocumeM Required: Y
DocumentContaet: foddHudey
Contact Phone: 266-8549
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Assign 2
Number
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Routing 4
Order 3
fot # of Sign Pag (Ciip All Locations for Signature)
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to approve the attached resolution accepting a tentative settlement with Merrill Lynch, Pierce, Fenner & Smith, Inc. and authorize
he City's staff to execute related documents.
2ecommendations: Approve (A) or Reject (R):
Planning Commission
CIB Committee
Civil Service Commission
Personal Service CoMracts Must Answerlhe Pollowing Questions:
t. Has this person/firm ever worked under a contract for this department?
Yes No
2. Has this persoNfirtn ever been a city employee?
Yes No
3. Does this person/firm possess a skill not normally possessed by any
current city employee?
Yes No
Explain all yes answers on separate sheet and attach to green sheet.
iitiating Problem, Issues, Opportunity (Who, What, When, Where, Why):
'he City commenced Financial Indushy Regulatory authorizing arbitration. Merrill Lynch, Pierce, Fenner & Smith, Inc. will pay the
�ity $900,000.00
.dvantages If Approved:
'he City will settle the azbiration and recover $900,000.00
isadvantages IfApproved:
one known
isadvanWg�s If Not Approved:
he City will not settle the azbitrarion.
Total AmouM of
Trensaction:
Funding Source:
Cost/Revenue Budgeted:
Activity Number:
Financial Information:
(E�cplain)