In The News

Daily Journal Selects Suit Involving Berger Kahn as “Top Plaintiffs’ Verdicts by Dollar” for the Firm’s Role in the $69M Yorba Linda Water District Judgment

(filed under: In The News | February 19, 2013)

A July 13, 2012 judgment awarding a group of homeowners and subrogating insurers more than $69 million also earned Berger Kahn a spot in the Daily Journal’s “Top Verdicts” for the Top Plaintiffs’ Verdict by Dollar.

Berger Kahn’s clients, insurers with Farmers Insurance Group of Companies, were awarded $9.2 million of the total verdict.  Shareholder David Ezra worked as unofficial liaison counsel along with several other plaintiff attorneys.

“This was a very significant judgment,” says David Ezra, “primarily because of the shocking series of accidental events that led to the catastrophic failure of the Yorba Linda Water District’s essential pumping station.”

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Top Plaintiffs’ Verdicts by Dollar -
Itani v. Yorba Linda Water District

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In 2008, a catastrophic wildfire swept through northern Orange County, scorching more than 30,000 acres and damaging or destroying 381 homes.

A group of homeowners and subrogating insurers filed suit against the Yorba Linda Water District, alleging the agency was responsible for certain property losses because the city’s fire hydrants went dry just before the blaze.

When the fire threatened homes in the upper Hidden Hills area of Yorba Linda, three electrical pumps stopped working because of a wiring short and the gas-powered emergency fire pump overheated. As a result, hydrants went dry and nearly 20 homes were damaged or reduced to ash.

The suit argued that the water district was liable for the damage under principles of inverse condemnation, which allows victims to sue a government agency over loss of property, said Eric V. Traut, and attorney who represented the plaintiffs.

Retired Judge John K. Trotter ruled in favor of 12 of the 19 involved homes, stating that firefighters were able to get water to the other seven. A total judgment of nearly $70 million was awarded to the homeowners and subrogating insurers. Itani v. Yorba Linda Water District, City of Yorba Linda, 30-2009-00124906 (Orange County Super. Ct., filed 2009).

Traut said the case is particularly unique because it was one of the first inverse condemnation cases in the state to be tried involving a fire.

Attorney David B. Ezra of Berger Kahn, who worked as unofficial liaison counsel along with several other plaintiff attorneys, said hundreds of depositions were involved in the case since it began in early 2010.

“The case had been pending for a long time, and the water district did not think they were liable at all,” he said. “So it was a hard-fought battle.”

The district argued that because it did not start the fire, it could not be held liable.

The city of Yorba Linda was dismissed by all plaintiffs prior to the reference proceeding and was not held liable.

Traut and the homeowner plaintiffs have now teamed up with the water district in a a lawsuit against the water district’s insurance company, American International Group, alleging the company denied the claim and refused to pay the verdict.

-Alexandra Schwappach

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