l.a. alliance

The Los Angeles City Council on Wednesday approved a fivefold increase to its contract with a law firm that drew heated criticism for the invoices it submitted in a high-stakes homelessness case.

Three months ago, Gibson, Dunn & Crutcher billed the city $1.8 million for two weeks of legal work, with 15 of its attorneys billing nearly $1,300 per hour. By Aug. 8, the cost of the firm’s work had jumped to $3.2 million.

The price tag infuriated some on the council, who pointed out that they had approved a three-year contract capped at $900,000 — and specifically had asked for regular updates on the case.

Despite those concerns, the council voted 10-3 Wednesday to increase the firm’s contract to nearly $5 million for the current fiscal year, which ends in June 2026. Councilmember Katy Yaroslavsky supported the move, saying Gibson Dunn’s work has been “essential to protecting the city’s interests.”

“At the same time, we put new oversight in place to ensure any additional funding requests come back to council before more money is allocated,” said Yaroslavsky, who heads the council’s budget committee.

Councilmembers Tim McOsker, Adrin Nazarian and Nithya Raman voted against the contract increase.

McOsker, who also sits on the budget committee, said he was not satisfied with Gibson Dunn’s effort to scale back the amount it is charging the city. After the council asked for the cost to be reduced, the firm shaved $210,000 off of the bill, he said.

“I think Gibson should have given up more, and should have been pressed to give up more,” McOsker said after the vote.

A Gibson Dunn attorney who heads up the team that represents the city did not immediately respond to a request for comment. Meanwhile, an aide to City Atty. Hydee Feldstein Soto welcomed the council’s vote.

“We are pleased that the City Council recognizes and appreciates the strong legal representation that Gibson, Dunn & Crutcher has provided and continues to provide to the city,” said Karen Richardson, a spokesperson for Feldstein Soto, in a statement.

Gibson Dunn was retained by the city in mid-May, one week before a major hearing in the case filed by the L.A. Alliance for Human Rights, a nonprofit group that has been at odds with the city over its handling of the homelessness crisis since 2020.

The city reached a settlement with the L.A. Alliance in 2022, agreeing to create 12,915 homeless shelter beds or other housing opportunities. Since then, the L.A. Alliance has repeatedly accused the city of failing to comply with the terms of the settlement agreement.

In May, a federal judge overseeing the settlement called a seven-day hearing to determine whether he should take authority over the city’s homelessness programs from Mayor Karen Bass and the City Council, and hand them over to a third party. Alliance lawyers said during those proceedings that they wanted to call Bass and two council members to testify.

In the run-up to that hearing, the city hired Gibson Dunn, a powerhouse law firm that secured a landmark Supreme Court ruling that upheld laws prohibiting homeless people from camping in public spaces.

Feldstein Soto has praised Gibson Dunn’s work in the L.A. Alliance case, saying the firm helped the city retain control over its homelessness programs, while also keeping Bass and the two council members off the stand. She commended the firm for getting up to speed on the settlement, mastering a complex set of policy matters within a week.

Feldstein Soto initially hoped to increase the size of the Gibson Dunn contract to nearly $6 million through 2027 — only to be rebuffed by council members unhappy with the billing situation. On Wednesday, at the recommendation of the council’s budget committee, the council signed off on nearly $5 million over one year.

A portion of that money will likely go toward the filing of an appeal of a federal judge’s order in the LA Alliance case, Feldstein Soto said in a memo.

Faced with lingering criticism from council members, Feldstein Soto agreed to help with the cost of the Gibson Dunn contract, committing $1 million from her office’s budget. The council also tapped $4 million from the city’s “unappropriated balance,” an account for funds that have not yet been allocated.

By transferring the money to the Gibson Dunn contract, the council depleted much of the funding that would have gone to outside law firms over the current budget year, said McOsker, who called the move “bad fiscal management.”

Raman, who heads the council’s homelessness committee, said her dissenting vote wasn’t about the price of the services charged by Gibson Dunn, but rather the fact that so much was spent without council approval.

“As someone who is watching that money very closely, I was frustrated,” she said. “So my ‘no’ vote was based on that frustration.”

The Los Angeles City Council stopped short on Wednesday of giving another $5 million to a law firm hired to defend the city in a long running homelessness case, sending the question to a committee for additional vetting.

City Atty. Hydee Feldstein Soto had asked the council to provide a nearly sixfold increase in her office’s contract with Gibson Dunn & Crutcher LLP, taking the cost up to $5.9 million.

The council voted in May to provide Gibson Dunn $900,000 for up to three years of work. Over the following three months, the law firm blew way past that amount, racking up $3.2 million in bills.

“Obviously, we are not happy, and not ready to pay that bill that we didn’t bargain for,” said Councilmember Bob Blumenfield. “We were supposed to have been notified when they were exceeding that amount. It’s written in the contract that we were supposed to be notified at different levels. We were not notified.”

On Wednesday, after meeting behind closed doors for more than 90 minutes, the council sent Feldstein Soto’s request to the powerful budget committee for more review.

Blumenfield, who sits on that committee, did not offer a timeline for taking up Feldstein Soto’s request. However, he said he wants the city attorney to go back to Gibson Dunn to ensure that “taxpayers are better served.”

The L.A. Alliance sued in 2020, saying the city was doing too little to move people homeless people indoors and address the concentration of encampments in Skid Row and elsewhere. The group eventually reached a settlement with the city that required, among other things, the construction of homeless housing beds and the removal of encampments.

As part of the settlement, the city must provide 12,915 homeless beds or other housing opportunities, such as rental vouchers, by June 2027. L.A. also must remove 9,800 homeless encampments, such as tents or recreational vehicles, by June 2026.

Lawyers for the L.A. Alliance contend the city has repeatedly fallen short of the obligations spelled out in the settlement. In May, the group attempted to persuade U.S. Dist. Judge David O. Carter to seize control over the city’s homeless initiatives and turn them over to a third-party receiver.

Gibson Dunn waged an aggressive defense of the city’s actions, issuing hundreds of objections and working to undermine key witness testimony.

Carter ultimately rejected the request to appoint a receiver, but also concluded that the city had breached the settlement agreement in several ways.

Feldstein Soto did not immediately comment on the council’s action. She has previously praised the law firm, saying through a spokesperson that it “delivered exceptional results and seamless representation.”

The city is now planning to appeal portions of the judge’s order. Feldstein Soto said some of the additional $5 million would go toward work on that appeal, with Gibson Dunn representing the city through June 2027, according to a confidential memo reviewed by The Times.

In her memo, Feldstein Soto commended Gibson Dunn for preserving the city’s control over its homeless programs and preventing several elected officials from being ordered to testify.

Blumenfield also offered praise for Gibson Dunn, saying he appreciates the firm’s “good work for the city.” Nevertheless, he also wants Feldstein Soto to look for ways of cutting costs.

“Sending it to committee sends a message — which is, we don’t like what was put before us for lots of reasons,” he said.

Matthew Umhofer, an attorney representing the L.A. Alliance, said after the meeting that he was “heartened that the city didn’t give this misadventure a blank check.”

“I’m hopeful the City Council committee scrutinizes this,” he said, “and asks the important question of whether spending $6 million on an outside firm to avoid accountability is a good use of taxpayer funds.”

The high-powered law firm that racked up big bills working to keep the city of Los Angeles from losing control over its homeless programs is now looking to increase its contract by $5 million.

City Atty. Hydee Feldstein Soto has asked the City Council to increase the city’s contract with Gibson Dunn & Crutcher LLP to $5.9 million, up from the $900,000 approved three months ago, according to a confidential memo she sent to council members.

Gibson Dunn has been defending the city since mid-May in a lawsuit filed by the nonprofit Alliance for L.A. Human Rights, which resulted in a settlement agreement requiring the construction of new homeless housing and the removal of street encampments. The L.A. Alliance alleges that the city has repeatedly violated the agreement.

The Times reported last month that Gibson Dunn billed the city $1.8 million for about two weeks of work, with 15 attorneys charging $1,295 per hour and others charging lower amounts.

By Aug. 8, Gibson Dunn had racked up $3.2 million in billings in the case, according to the city attorney’s memo, a copy of which was reviewed by The Times. Those invoices arrived during a difficult financial period for the city, caused in part by a surge in expensive legal payouts.

Much of the firm’s work was focused on its preparation for, and participation in, a lengthy hearing before a federal judge who was weighing the Alliance’s request to hand control over the city’s homeless initiatives to a third party.

Gibson Dunn was retained by the city one week before the hearing, which lasted seven court days, at eight or more hours per day.

“The evidentiary hearing was more extensive than anticipated, with the plaintiffs calling more than a dozen witnesses and seeking to compel City officials to testify,” Feldstein Soto wrote in her memo.

Feldstein Soto’s office did not immediately respond to inquiries from The Times. But the city attorney has been outspoken in defending Gibson Dunn’s work, saying the firm kept the city’s homeless initiatives from being turned over to a receiver — a move that would have stripped authority from Bass and the City Council.

Gibson Dunn also prevented several elected officials — a group that includes Bass — from having to take the stand, Feldstein Soto said in her memo.

City Councilmember Monica Rodriguez said she would vote against a request to spend another $5 million on Gibson Dunn. That money would be better spent on ensuring the city complies with its legal obligations in the case, which include the construction of 12,915 homeless beds and the removal of 9,800 encampments, she said.

Rodriguez, who also voted against the initial round of funding for Gibson Dunn, said $5 million would be enough to cover “time limited” housing subsidies for at least 500 households in her northeast San Fernando Valley district for an entire year.

“At the end of the day, we’re here to house people,” she said. “So let’s spend the resources housing them, rather than being in a protracted legal battle.”

Matthew Umhofer, an attorney who represents the L.A. Alliance, called the request for nearly $6 million “ludicrous,” saying the city should focus on compliance with the settlement agreement.

“Gibson is a very good firm. Lawyers cost money. I get it,” he said. “But the city has hundreds of capable lawyers, and the notion that they need to spend this kind of money to prevent a court from holding them to their obligations and their promises, it raises real questions about the decision-making in the city on this issue.”

“For a city that claims to be in fiscal crisis, this is nonsense,” Umhofer added.

In her memo, Feldstein Soto said the additional $5 million would cover Gibson Dunn’s work in the case through June 2027, when the city’s legal settlement with the L.A. Alliance is set to expire.

During that period, Gibson Dunn would appeal an order by U.S. District Judge David O. Carter, arguing that the judge “reinterpreted” some of the city’s obligations under the settlement agreement, Feldstein Soto said in her memo. The law firm would also seek to “reform” the settlement agreement, Feldstein Soto said.

Theane Evangelis, an attorney with Gibson Dunn who led the team assigned to the L.A. Alliance case, did not immediately respond to a request for comment. Her firm has played a huge role in redefining the way cities are permitted to address homelessness.

Representing Grants Pass, Ore., the firm secured a landmark ruling from the U.S. Supreme Court upholding laws that prohibit homeless people from camping in public spaces.

The firm brought a new, more pugnacious approach to the L.A. Alliance case, issuing hundreds of objections throughout the seven-day hearing and working to undermine the credibility of key witnesses.

A month later, Carter issued a 62-page order declining to turn L.A.’s homeless programs over to a third party. However, he also found that the city had failed to comply with the settlement agreement.

Feldstein Soto said the additional $5 million would allow the firm to carry out its work through June 2027, when the Alliance settlement is scheduled to expire.

Gibson Dunn’s legal team would continue to pursue the city’s appeal while also helping to produce the quarterly reports that are required by the settlement agreement.

A coalition of airlines, hotels and concession companies at Los Angeles International Airport filed paperwork Thursday to force a citywide vote on a new ordinance hiking the minimum wage of hotel and airport workers to $30 per hour by 2028.

The group, known as the L.A. Alliance for Tourism, Jobs and Progress, is hoping to persuade voters to repeal the ordinance. But first, the alliance would need to gather about 93,000 signatures within 30 days to qualify the measure for the ballot in an upcoming election.

Phil Singer, a spokesperson for the alliance, said the wage increase “threatens revenue Los Angeles urgently needs” — and its standing as the host of the 2028 Olympic and Paralympic Games.

“Small businesses will be forced to shut down, workers will lose their jobs, and the economic fallout will stretch across the city,” Singer said in an email. “We’re fighting for all of it: the city’s future, the jobs that sustain our communities, and the millions of guests the tourism industry proudly serves year after year.”

The new ballot measure campaign comes just two days after Mayor Karen Bass signed the minimum wage legislation into law.

The wage ordinance has been hotly opposed by an array of L.A. business organizations, which argue that it increases wages in the tourism industry too much and too quickly. However, it was welcomed by unions representing hotel and airport employees, which have supported many of the politicians who backed the measure.

The alliance’s campaign committee has received major funding from Delta Airlines, United Airlines and the American Hotel & Lodging Assn., Singer said. The group’s petition, submitted to the city clerk’s office, was signed by five businesspeople, including Greg Plummer, operator of an LAX concession company; Mark Beccaria, a partner with the Hotel Angeleno on L.A.’s Westside; and Alec Mesropian, advocacy manager with the organization known as BizFed.

The alliance is targeting a law that’s slated to push the hourly minimum wage to $22.50 on July 1 for housekeepers, parking attendants and hotel restaurant workers, as well as LAX skycaps, baggage handlers and concession employees. The wage would jump to $25 in 2026 and $27.50 in 2027.

The wage increase was spearheaded by Unite Here Local 11, the hotel and restaurant worker union, and by Service Employees International Union United Service Workers West, which represents private-sector airport workers.

Kurt Petersen, co-president of Unite Here Local 11, called the business group’s proposal “shameful” and promised his union’s members would go “toe to toe out on the streets” with the alliance’s signature gatherers.

“The hotel industry’s greed is limitless,” Petersen said. “They would rather spend millions getting them to sign this petition than pay their workers enough to live in Los Angeles. It’s shameful, but we’re confident that Angelenos will see through their deceptions and stand with workers.”

Under the city’s laws, hotel and airport workers have minimum wages that are higher than those who are employed by other industries.

The hotel minimum wage, approved by the council in 2014, is currently $20.32 per hour. The minimum wage for private-sector employees at LAX is $25.23 per hour, which includes a $5.95 hourly healthcare payment.

For nearly everyone else in L.A., the hourly minimum wage is $17.28, 78 cents higher than the state’s. The federal minimum wage is $7.25 per hour.

Backers of the airport and hotel minimum wage hikes say they will help some of the region’s lowest paid workers cover the rising cost of rent and food, while also giving them more disposable income to spend locally, delivering a boost to the region’s economy.

Detractors say it will undermine efforts by L.A.’s tourism industry to recover from the decline in business that was sparked by the outbreak of COVID-19 five years ago. They contend the ordinance will lead to layoffs, while also chilling development of new hotels.

The ordinance also requires airport and hotel businesses to provide an hourly healthcare payment — on top of the minimum wage — that starts at $7.65 in July and is expected to go up each year. (Hotels will be exempted from that requirement until 2026.)

Once the healthcare requirement is included, some businesses will be required to pay their workers an additional 60% over a three-year period, opponents of the wage increase say.