Judge approves $626 million settlement in Flint water crisis

A judge has approved a $626.25 million settlement in the Flint water crisis, but has not yet decided how much money goes to residents and how much lawyers keep.

In a Wednesday opinion, U.S. District Court Judge Judith Levy rejected all objections to the settlement of claims against the state and other parties sued by Flint residents for their role in the city’s lead-tainted water crisis.

Calling the settlement “a remarkable achievement,” Levy declined to immediately decide how much money attorneys should get for their work in the case.

After attorney fees are discounted, children are set to receive nearly 80 percent of the settlement, while 18 percent goes to adults who can prove health impacts or property damages. Smaller amounts will go to special education programs and businesses.

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More than 50,000 people have signed up to participate in the settlement, but it’s not clear whether all have valid claims. The city’s population was about 100,000 at the time of the crisis, but has since decreased to 81,000.

Payments aren’t likely until next year at the earliest.

Michigan’s state government is the biggest contributor to the agreement, which would resolve only some civil suits tied to the crisis. The state is paying $600 million, while $20 comes from the City of Flint; $5 million from McLaren Regional Medical Center; and $1.25 million from Flint-based engineering firm Rowe Professional Services Co.

That’s lower than the original proposed amount, after Levy last month granted McLaren permission to lower its contribution by $15 million to keep the hospital system from walking away from the agreement.

Claire McClinton, 72-year-old Flint resident who voiced her concerns in front of Levy earlier this year, said the settlement is too small.

Among other concerns, McClinton also objected to the way funds are distributed, with less money available for adults and almost no money available to adults who can’t prove they suffered physical harm. And she’s frustrated that Levy allowed McLaren to shrink its contribution to a quarter of its former size.

“I’m just very, very disappointed,” McClinton said. 

She intends to hire a lawyer to pursue her own lawsuit against the state, she said.

Flint’s water crisis began in 2014, when a state-appointed emergency manager approved the city’s switch from Detroit’s water supply to the Flint River, without requiring anti-corrosion chemicals to prevent lead from leaching out pipes.

The water crisis prompted congressional hearings, criminal charges against Michigan’s former governor and other top public officials and a bevy of lawsuits.

Levy acknowledged during hearings this year that she had “a difficult decision” — especially about fees for lawyers, who sought 30 percent of the overall settlement.

She noted in Thursday’s order that she’ll address that question in a separate opinion.

Lawyers contend they deserve that much because they have logged 182,000 hours of work — the equivalent of more than 20 years’ labor — on behalf of Flint residents. 

In hearings earlier this year, lawyers say the fees are less than they could collect if they followed the terms of individual agreements they had previously reached with plaintiffs. 

In an interview with Bridge Michigan on Wednesday, co-lead counsel Ted Leopold noted that lawyers took on enormous gamble by working on contingency, meaning that if they had lost, Leopold said, they have received virtually no payment.

“That’s the nature of litigation, and that’s the risk we took,” he said.

Leopold called the settlement an important moment of closure for the residents  and noted its national significance. 

“Something that is forgotten a little bit,” he said, “is how this has had an effect nationally — even now with this new infrastructure bill that’s going to address clean water related issues, lead pipe issues.”

Objectors to the proposed settlement fee argue it’s far too much. Frank Bednarz, an attorney for the Washington D.C.-based Center for Class Action Fairness at the Hamilton Lincoln Law Institute, said he hopes Levy will approve about half of what lawyers seek.

Bednarz questioned how much of lawyers’ time was spent serving clients’ interests versus competing with one another for business.

“It’s too much,” he said. “It does make sense that they deserve to be paid for their work, but not at (this amount).”

Gov. Gretchen Whitmer and Attorney General Dana Nessel lauded the settlement’s approval, though both acknowledged the lingering harm to Flint residents.

“We hope this settlement helps the healing continue as we keep working to make sure that people have access to clean water in Flint and communities all across Michigan,” Whitmer said in a statement.

A settlement is a major milestone, but far from the end of legal wrangling. Lawyers continue to pursue lawsuits against four other parties, including the U.S. Environmental Protection Agency. And criminal proceedings against former Gov. Rick Snyder and other public figures involved in the decision to switch Flint’s drinking water are still ongoing.

McClinton said that as those lawsuits proceed, “we can only hope that the EPA won’t be as irresponsible and as heartless and inhumane as the state of Michigan and these other doggone defendants. That we can get some kind of justice from the EPA.”

Hearings about the settlement have proved contentious, and not just about the lawyer fees.

The deal calls for people to submit medical records, financial documents or other proof they suffered physical harm or financial losses. During hearings, some Flint residents objected that they should be left out of the settlement because they didn’t suffer the worst effects of the poisoning. 

Everyone, they argued, endured the psychological trauma of fearing for their health, and continues to endure the stigma of being a resident of a city that’s now internationally known for drinking poisoned water.