Litigation Case Study

November 30‚ 2010

Mintz Levin Finalizes $132 Million Settlement For Hurricane Katrina Victims

On November 15, 2010, Mississippi Governor Haley Barbour, Department of Housing and Urban Development (HUD) Secretary, Shaun Donovan, Mississippi housing advocates, and lawyers from Mintz Levin stood together at a press conference in North Gulfport, Mississippi, to announce a $132 million settlement of the lawsuit Mintz Levin and their co-counsel (the Mississippi Center for Justice and Lawyers’ Committee for Civil Rights Under Law) filed, pro bono, in December 2008 on behalf of the Mississippi NAACP, the Gulf Coast Fair Housing Center, and four individuals. The lawsuit concerned HUD’s approval of the state’s “reprogramming” of post-Katrina relief money away from housing needs and to a massive expansion of the Port of Gulfport.

The $132 million program, already being implemented, is set to assist approximately 4,400 already identified households. Furthermore, the State of Mississippi has agreed to undertake a massive, nearly three-month-long outreach effort to find hundreds, if not thousands, of still not identified families that remain in sub-standard conditions or without homes more than five years after Hurricane Katrina. In the end, it is likely that the program will rebuild upwards of 6,000 homes. Individuals eligible to receive assistance—up to $75,000 for reconstruction, or help procuring a “Katrina Cottage”—from the new $132 million program will include many who were left out of Mississippi’s prior Katrina relief programs.

This victory has received significant media attention across the country. The New York Times wrote in its November 16, 2010 editorial regarding the settlement, “Prompted by the lawsuit, the Obama administration began pressing Mississippi to revisit its housing aid policies,” which, the Times wrote, unfairly “shut out victims whose homes were destroyed by wind, rather than water.” Similarly, the Los Angeles Times quoted Mintz Levin Member Larry Schoen, who said, “Until now, those who suffered wind damage were left without any remedy…. They can now finally receive the funds they so desperately need.” Further underscoring the importance of the lawsuit in driving the process, HUD Secretary Donovan stated in an interview with WLOX, a Mississippi television station, “[I]t’s always better rather than fighting in court while families are still suffering to put our heads together and say, you know what, [the Plaintiffs] had a point.” Secretary Donovan further acknowledged, “under the prior administration, there was a decision made that we didn’t agree with; we went back and said you know what, we need to admit we were wrong, made a change and we’re moving in a new direction…” (WLOX).

The $132 million now being used to close the gaps in housing relief is not drawn from the money allocated in 2007 to the Port of Gulfport, which was the subject of the lawsuit and of major concern to the state. Instead, given the state’s aversion to the limbo into which the lawsuit put its Port funds, the State was willing to find other excess funds from separate Mississippi federal economic development projects to meet the remaining housing needs. Mintz Levin Associate Noah Shaw told the Associated Press, “That’s OK with us. The whole point here was to create an incentive that both HUD and the state do the right thing. We don’t really care where they get the money as long as our plaintiffs are going to have their needs met.” (HUD, Mississippi Provide $132 Million for Needy Katrina Victims, Associated Press, The Sun Herald, November 15, 2010).

In the end, the plaintiffs’ strategy, as devised by Mintz Levin and co-counsel, worked. The state’s agreement to immediately implement the direct aid and outreach program as negotiated, with HUD’s oversight, is a far better result than could have been achieved even had the plaintiffs prevailed in their litigation. That is, a federal court could only have nullified HUD’s 2007 approval of the state’s reprogramming of funds, but it could not have ordered that the money be used in a particular way to meet these plaintiffs’ current needs. Here, however, the plaintiffs are the ones who get to have a hand in determining how the money will be used, and it happens immediately.

This marks a significant win for the thousands of Hurricane Katrina victims who wondered, until now, why their government had decided not to help them. Following the settlement, Reilly Morse, Senior Counsel at the Mississippi Center for Justice, expressed his gratitude in a written statement: “It is extraordinary for me to contemplate that a major national law firm with all the competitive pressures of our profession put the years and hours worth of commitment to achieve this outcome to a remote corner of the Deep South. It is moving. And the work itself, the advice and counsel, the tactics and the strategy, were the best anyone could hope for.”

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