Report Prepared by: Craig J. Cornwell, City Attorney
Title
SUBJECT: Authorization for Additional Payment of Litigation Costs in Connection with the Retainer Agreement with Marderosian and Cohen for 2023 Flood Litigation
REPORT IN BRIEF
On July 3, 2023, the City Council approved a Retainer Agreement with Marderosian and Cohen to represent the City in litigation seeking recovery of damages against California Department of Fish and Wildlife (23CV-03845) related to the January 2023 flooding events emanating from Bear Creek and other related creeks, rivers, channels, and flood control and irrigation facilities located in Merced County, California.
After further review of the original approvals, staff identified that while the Retainer Agreement was authorized, litigation costs were not included in that authorization. On September 15, 2025, the City Council approved the payment of litigation costs associated with the representation.
To date, the City has incurred approximately $350,000 in litigation costs, primarily related to deposition expenses and expert witness retainer agreements. Staff anticipates an additional $175,000 in costs through trial, which is scheduled for January 27, 2026.
RECOMMENDATION
City Council - Adopt a motion:
A. Authorizing the City to pay additional litigation costs anticipated to be incurred through trial, estimated at approximately $175,000; and,
B. Authorizing the City Manager to execute any necessary documents related to the payment of these litigation costs.
Body
ALTERNATIVES
1. Approve, as recommended by staff; or,
2. Approve, subject to conditions other than as recommended by staff; or,
3. Deny; or,
4. Continue to a future meeting.
AUTHORITY
Charter of the City of Merced, Section 200.
CITY COUNCIL PRIORITIES
As provided for in the 2025-26 Adopted Budget.
DISCUSSION
On July 3, 2023, the City Council approved a Retainer Agreement with Marderosian & Cohen to represent the City in litigation arising out of the January 2023 Flood Event. The litigation is advancing and is now scheduled for trial on January 27, 2026.
Following a closer review of the original Council action, staff identified that while the agreement itself was authorized, approval for payment of litigation costs was not included. Such costs are necessary to support the litigation, including depositions, expert witnesses, document preparation, and trial-related expenses. On September 15, 2025, the City Council approved the payment of litigation costs associated with the representation.
To date, the City has incurred approximately $350,000 in costs. These expenses have included deposition costs and expert retainer agreements necessary to advance the case. Looking ahead, staff anticipates an additional $175,000 in costs through trial.
Approval of this request will authorize payment of the additional costs expected through trial, allowing the City to continue pursuing recovery of damages.
IMPACT ON CITY RESOURCES
No additional appropriation is needed. Funding for these anticipated litigation costs are available within Fund 6000- Wastewater Operations fiscal year 25-26 adopted budget.
ATTACHMENTS
1. Legal Services Agreement - Marderosian & Cohen