DeKalb schools’ Heery lawsuit big by many measures


April 2006: Heery International Inc. and E.R. Mitchell & Co., which jointly managed school construction projects, are suspended, then fired 10 months later.

February 2007: The firms sue for $478,000 in unpaid bills and alleged damages.

March 2007: DeKalb counterclaims for $17 million, eventually seeking more than $100 million and alleging billing fraud and mismanagement.

July 2009: After making more than $6 million in legal fees on the Heery/Mitchell case, DeKalb's law firm, King & Spalding, agrees to work on contingency, retroactive to June 1, 2008.

October 2010: Heery/Mitchell file a second amended complaint, claiming criminal fraud by former DeKalb Schools Superintendent Crawford Lewis and others drove their termination.

June 2012: School board approves settlement with E.R. Mitchell & Co.

February 2013: Civil trial date with DeKalb Superior Court Judge Clarence Seeliger, since postponed.

March 18, 2013: Heery president William Heitz sends school officials a letter calling the legal dispute an "unconscionable" war of attrition, and warning that the company had spent all its insurance money on lawyers, leaving nothing for any court-ordered payout.

April 2, 2013: DeKalb "special master" Judge Stanley Birch dismisses the bulk of Heery's claims against the school district.

May 3, 2013: A pair of DeKalb residents, one a Heery executive named as a defendant in DeKalb's lawsuit, file a legal challenge to the district's contract with King & Spalding, alleging it puts the district illegally in debt to the lawyers.

June 3, 2013: DeKalb school board votes to authorize signing an amended contract in which King & Spalding agrees to waive $30 million in legal fees and to pay ongoing court costs. At this point, DeKalb has spent $12 million on court costs in addition to the $6 million paid to King & Spalding prior to the first contingency agreement.

June 7, 2013: Heery offers to settle lawsuit and "donate" $1 million to the school district.

June 10, 2013: DeKalb school board approves amended contract with King & Spalding.

June 11, 2013: DeKalb rejects Heery's settlement proposal.

Heery lawsuit by the numbers

  • 70 — number of bankers boxes needed to hold the court documents
  • 3,954 — motions, orders and other filings as of June 26
  • $18 million — school legal fees and case costs (expert witness fees, travel, etc.) as of June
  • $90.50 — filing fee paid by Heery/Mitchell in 2007
  • $92 — fees generated by motions filed from July 2012 to late June; a new law allowed court clerks to charge a dollar per motion as of last July.

When measured in dollars, the six-year legal battle between the DeKalb County School District and Heery International Inc. sounds big.

At one point, the construction management company was seeking at least $10 million in damages on false termination claims, and the school system was countering for more than $100 million over allegations of billing fraud and mismanagement. DeKalb’s lawyers, meanwhile, wanted at least $30 million for their time until they renegotiated their contingency agreement with DeKalb this spring.

Court decisions have whittled the potential damages down, but the lawsuit may still rank among the biggest in DeKalb history — if not in dollars, then in volume, as in cubic feet.

To really understand the size of the case, look beyond the financial costs to the docket sheet, where the motions, orders and other filings are boiled down to a few sentences

A docket sheet is typically just that — a sheet, or maybe three. In the Heery case it’s a pile 2 inches thick. And the documents summarized by those sheets fill 70 bankers boxes, each containing as many as 2,500 pages — enough for 40 or 50 normal cases.

“Everything’s got to get hole-punched,” said Durelle Gunn, the docket clerk assigned to the case. He estimates he has spent hundreds of hours on the job. “That’s just filing and keeping it in order — and finding space,” he said. “God forbid somebody wants copies.”

DeKalb Superior Court Clerk Debra DeBerry said the case has cost her office thousands of dollars in time and materials — far more than the $182.50 in filing fees collected as of late June. DeBerry acknowledged that she did charge lawyers a bundle — about $22,000 — when they filed appeals in the case. But she said her office had to render a lot of additional service: every document had to be copied in triplicate, and a sworn officer had to deliver mountains of paperwork to the appeals court in downtown Atlanta.

Gunn hopes the case ends soon, and he might get his wish.

In a letter to the school district in March, Heery president William Heitz bemoaned the tens of millions of dollars committed by both sides to an “unconscionable” court battle he labeled a “war of attrition.” Heery later offered to “donate” $1 million if the district agreed to drop its case — an offer the district declined as not “meaningful.”

Heitz made victory sound Pyrrhic.

“Even if the school district is successful at trial, it is unlikely that it would realize any recovery,” Heitz wrote. “There is no longer an insurance policy against which to collect because Heery’s policy was exhausted by the cost of litigating this case, and its costs continue to mount.”

Heitz wrote that any “large” judgment will be appealed anyway, causing “several more years” of legal costs.

Not to mention more boxes of paper.