ALLENTOWN, Pa. - Lehigh County Solicitor Matthew Sorrentino stood before county commissioners Wednesday night to defend the reputation of his law firm against a claim that it has been involved in a conflict of interest regarding the tax increment financing plan for the proposed Hamilton Crossings Shopping Center in Lower Macungie Township.
Sorrentino appeared before the commissioners at their administrative committee meeting Wednesday night, as a follow-up to a five-page letter he sent them May 9, in which he stated "no conflict of interest exists."
"I'm not sure there's a great deal more I can add with respect to this subject," Sorrentino told the commissioners. "I can't say a lot more than I said in the letter. I'm happy to answer any additional questions you have."
In response to their questions, he explained why there has been no legal conflict of interest and cited the fact that the county commissioners rejected participating in the Hamilton Crossings TIF last year as "the proof in the pudding."
Sorrentino told the commissioners: "I don't want my solicitors or myself to be in a position where you're uncomfortable with the advice you are receiving."
He has advised the commissioners of conflict of interest policies being implemented by the county law department, which he heads. He said two of the three policies "are merely a codification of practices already followed by the county law department."
The third policy, being implemented for the commissioners, states that they and the county executive will be advised if any members of Sorrentino's staff, or members of their law firms, represent other governmental agencies in any matter where the county may be involved.
The suggestion of a conflict of interest involving Sorrentino's law firm -- Norris McLaughlin & Marcus -- was raised in a two-page letter sent to the county commissioners on April 17 by Atty. Jonathan Hugg of Clark Hill, a Philadelphia law firm.
Hugg represents Cedar Realty Trust, the owners of the Trexler Mall and Trexlertown shopping centers who oppose the Hamilton Crossings TIF. He regularly speaks out against the TIF at public meetings.
The issue is that Sorrentino works for the county.
Atty. Richard Somach, his partner at Norris McLaughlin & Marcus, is the Lower Macungie Township solicitor, whose commissioners will determine the fate of TIF financing for the shopping center on June 5.
Atty. John Lushis, also a partner at Norris McLaughlin & Marcus, is solicitor to the Lehigh County Industrial Development Corporation, which wrote the Hamilton Crossings TIF plan.
In his letter, Sorrentino told commissioners Norris McLaughlin & Marcus does not represent Lehigh County. "Rather, I am the Lehigh County solicitor and I am also a partner in Norris McLaughlin & Marcus."
Sorrentino explained the county, Lower Macungie and LCIDA are not adversaries and that the three lawyers are not pursuing inconsistent legal positions on the same legal issue, even though their clients may be seeking different political policy outcomes.
Hugg's letter maintained: "It is inappropriate for the solicitor's law firm subsequently to assist proponents of the TIF as well as those that are supposed to be considering the TIF in a neutral manner."
Hugg stated lawyers' rules of professional conduct prohibit them from having conflicts of interest related to current and former clients.
"Ultimately, a lawyer cannot represent multiple clients taking materially different positions in the same controversy unless the lawyer obtains informed consent from all the clients."
Hugg also maintained lawyers in one law firm cannot represent different interests.
Noting the that county commissioners rejected participating in the TIF last year, Hugg said commissioners "should consider demanding that the solicitor's firm disqualify itself from representing any other entity regarding the TIF."
On Wednesday, Commissioner Percy Dougherty explained that Hugg's letter brought the conflict of interest issue to the county commissioners' attention.
"In my mind, Mr. Hugg has nothing at all to do with why we're discussing this tonight," insisted Commissioner Scott Ott. "We're discussing it because members of the board want to discuss it. Who brought it to our attention is irrelevant."
"But that's what got it started," said Dougherty.
Said Sorrentino: "I have no interest, frankly, in talking about the TIF. But that is what started this. I felt when someone either between the lines or overtly accuses you of a conflict of interest, you have the obligation to respond."
Sorrentino said he has only tangentially involved in the TIF issue for the county and that --"with my agreement and out of an abundance of caution" – Somach and Lushis have "screened" him from the advice they gave their respective clients.
What constitutes a conflict of interest
The solicitor gave the commissioners a different explanation of conflict of interest than the one they received from Hugg.
"The concept of conflict of interest, as lawyers understand it and as laid out by disciplinary rules, begins with the notion of adversity,"
"We have to have people who are adverse to each other – opposite sides of a legal issue, opposite sides of a lawsuit. "
As an example, Sorrentino explained to commissioners if there was an automobile accident and he represented the plaintiffs, the people injured in the accident, "one of my partners couldn't represent the defendant. That would be an actual current conflict of interest."
He said it does not only apply to court cases.
"I can't represent the landlord and have one of my partners represent the tenant in the negotiation of a lease.
TIF political, not legal
"If you want me to use the TIF as an example, I can do that as well,"
"The proponents of the TIF are the developers. They're the people who wanted you to approve the TIF.
"I haven't spent a lot of time studying this, but as far I can see, the adversaries of the TIF are citizen groups who believe the development either shouldn't move forward or should move forward without any kind of subsidy from the county government or the local government.
"Those are the people who are adverse to each other. The governments aren't adverse to each other. There was not a conflict with respect to the representation of those governmental bodies."
The solicitor indicated that when the commissioners decided not to participate in the TIF, they made a political decision, not a legal decision.
Sorrentino told commissioners: "People come in front of you all the time and advocate for you to make decisions in their favor or against them. Your solicitors, your lawyers, don't. The township's lawyers and the county's lawyers don't do that."
But Commissioner Vic Mazziotti, who was a member of the Hamilton Crossings TIF committee, told Sorrentino: "One of your attorneys represented the Industrial Development Authority. He was clearly a proponent for this project, beyond a doubt.
"You could say he was representing his client, the Industrial Development Authority, which was a proponent of this project. They recommended it. I'm asking, would that qualify as a proponent?"
"He's representing his client," agreed Sorrentino. He said if the Industrial Development Authority "is in the business of advocating or not advocating certain economic development, that's just a different political decision."
Added Sorrentino: "Lower Macungie may recommend the project too, but that doesn't have anything to do with the lawyers representing the adversaries or the proponents."
When Mazziotti noted the commissioners turned down the TIF, making them opponents, Sorrentino said that "ought to be in the proof in the pudding of this conversation.
"With all the advice that everybody was given, this board took a path contrary to what may be another decision from another organization one of my partners represents." He was referring to the upcoming vote by Lower Macungie commissioners.
Ott said there is an underlying difference between what is a conflict of interest "within the law trade, so to speak, and what can appear to be a conflict of interest in a political context. Things not only have to be right, but they have to look right, they have to smell right."
In his May 9 letter to commissioners, Sorrentino laid out the three principles regarding disclosure. All promise to notify commissioners and/or the county executive of any possible or actual conflicts of interests in the county law department.
Commissioner Michael Schware suggested those principles should be made public, perhaps on the county's website.
"To me, it's public," said Sorrentino. "I have nothing to hide.
"The whole purpose of writing this letter was to get the transparency that I think you want."
Taking it a step further, Sorrentino said that, as head of the county's law department, he is making the three principles departmental policy.
Ott suggested the commissioners might want to consider formalizing such a policy as part of the county's administrative code.
"That would be fine," said Sorrentino.
"I trust you, I know you're going to live by this," said Ott. "But someday all of us will be gone and you'll be gone. And there will be no lasting impact of this letter."
Dougherty told Sorrentino his letter was very comprehensive and touched on most of the points raised at the commissioners' April 23 meeting, where Hugg's letter was discussed.
In his letter Sorrentino said he served for years on the Disciplinary Hearing Committee of the Disciplinary Board of the Supreme Court of Pennsylvania, including as the committee's chair. He said he is familiar with rules of professional conduct for lawyers in the state, including those with respect to conflicts of interest.
Sorrentino told commissioners all the municipalities represented by Norris McLaughlin & Marcus are posted on the law firm's website, both for marketing and disclosure, "so people know who our law firm represents. It's not anything we try to hide."
Allentown, PA 18102