Antonio Fulgham can barely read or write. The 21-year-old from West Baltimore has been deemed "mentally retarded," with bleak job prospects. He blames his plight on lead poisoning he suffered as a toddler while growing up amid flaking paint in two Baltimore public housing units.
Last fall a city jury agreed, and ordered the Housing Authority of Baltimore City to pay him damages that amount to $1.27 million. Although nothing can undo his brain damage, Fulgham says the money will mean "a better change in my life."
But the housing authority says it has no intention of paying Fulgham – or anyone else who has won similar judgments for the harm caused by living in the city's lead-contaminated public housing. The authority is refusing to make good on any of nine court judgments totaling nearly $12 million, even though in some cases it agreed to the dollar amount or lost an appeal.
Since 2005 the agency has spent $3.8 million defending against lead paint cases, trying a succession of courtroom strategies that one plaintiff's lawyer likened to legal Whac-A-Mole. The authority's lawyers have argued that it is immune to lawsuits. They've argued it's too strapped to be sued. They've argued most of its assets are federal and therefore off limits. They've been accused in court of stalling.
Just last week, a circuit judge scolded one of the housing authority's private outside lawyers for withholding documents for over a year in one case, telling him in an exasperated tone that the delay "just has to stop."
City Housing Commissioner Paul T. Graziano acknowledges the lasting damage caused by lead-based paint. But legal arguments aside, he says the agency – the fifth-largest housing authority in the country, with a $300 million annual budget, according to its website – simply cannot afford to pay. Besides the judgments already entered against it, the housing authority faces 175 additional lead-paint cases whose potential claims exceed $800 million.
In short, Graziano says, paying for the harm caused by lead paint in public housing, which was mostly inflicted more than a decade ago, would make it impossible for the agency to adequately serve the 25,000 city households living in public housing and subsidized rentals today.
"While we are totally sympathetic and sensitive to the situation with respect to each of these families and the children involved, we just have to look at the entire picture before us," Graziano said. "Every dollar we spend on judgments is one less dollar that is available for major capital needs," he said, adding that "it would be tragic if this organization were to collapse due to financial insolvency."
Plaintiffs' lawyers counter that the authority has ample funds to satisfy the outstanding jury awards and settlements. If it's short on cash, they say, the authority can borrow on the bond market or seek government aid. They also criticize the authority for failing to maintain insurance coverage for lead paint-based claims after the mid-1990s, and for failing to self-insure afterward by setting money aside.
Attorney Brian Brown, whose clients have won millions in unpaid monetary awards against the authority, said public housing has always been a "housing of last resort" for desperate people with nowhere else to go.
"They go to the Housing Authority of Baltimore City: 'Please give us a safe place to live.' Now they're saying we didn't provide this to you, you're brain-damaged for life – and we're not going to compensate you for your losses," Brown said.
University of Baltimore law professor Charles Tiefer said if the housing authority were a private corporation, the weight of so many present and potential claims could eventually tip it into bankruptcy. Even if the authority finds new ways to avoid paying, Tiefer says the monetary judgments won't go away. That means plaintiffs could continue trying to collect for years to come.
"The housing authority can't get out of the judgments against it," he said.
Ruth Ann Norton, executive director of the Coalition to End Childhood Lead Poisoning, a Baltimore-based nonprofit, praised Graziano's efforts on lead paint issues in his 10 years as commissioner. Still, she said, the authority's no-pay stance is unfair to the children who, by no fault of their own, wound up living in perilous conditions and now face lifelong disabilities.
Even small amounts of lead can cause impairment that stunts a child's learning and contributes to behavior problems. Lead-based paint, once widely found in houses across the nation, was banned in Baltimore in 1950, but much of the city's housing stock predates the moratorium.
"I am very sympathetic to the plight of the city in terms of resources, but as a city we have a moral obligation to our children," Norton said. "There isn't any amount of money that's going to repair the damage. But just on basic fairness doctrine, it's troublesome on many, many levels."
Several lead-paint lawyers recently turned to Evan M. Goldman, an attorney who specializes in collections. In February he wrote to Mayor Stephanie Rawlings-Blake, calling the refusal to pay "a highly unpleasant insidious situation."
The mayor's spokesman, Ryan O'Doherty, declined to comment because the fight over the judgments is between the plaintiffs and the housing authority, which is not a city agency but an independent authority established under state law.
Goldman has moved to seize several housing authority bank accounts to satisfy three judgments totaling about $3 million. He also maintains the authority could sell off part of its 400-vehicle fleet.
In response, the authority has gone to federal court, arguing that because most of its money originates with the U.S. Department of Housing and Urban Development, its assets are federal property that is beyond the reach of plaintiffs.
U.S. District Judge William D. Quarles Jr. has agreed with the authority that plaintiffs cannot tap its federal funds, but litigation is continuing to determine which funds might be federal.
Suzanne C. Shapiro, a colleague of Brown's at the law firm of Saul E. Kerpelman, said the federal argument is only the latest strategy pursued by the authority's lawyers over the past decade. Courts have rejected earlier arguments, such as the notion that it has immunity from lead paint judgments.
"Each time the court says they're wrong and they have an obligation to satisfy judgments for these children, they come up with another tack," Shapiro said. "But it's basically the same thing: We don't have the money to pay."
From the late 1980s to mid-1996, the housing authority carried liability insurance for lead paint cases. Graziano said he does not know why the coverage ended, but Shapiro said the housing authority let it lapse.
Shapiro noted that in a 2002 decision, the Court of Special Appeals found that the housing authority was supposed to carry insurance or self-insure. The court also noted that the authority could take various steps to satisfy lead paint judgments, such as obtaining grants and requesting local government aid. In 2009 the Court of Appeals, Maryland's highest court, issued a similar ruling.
Asked about the authority's lack of insurance, Graziano said: "We are not self-insured because we do not have the resources to be self-insured."
Since the housing authority has no insurance, plaintiffs' lawyers have tried to seize its assets.
In a recent court filing, attorney J. Marks Moore III, who has represented the housing authority since the early 1990s, emphasized its financial woes.
Not only was the authority running a deficit in fiscal year 2009, Moore wrote, but it has unfunded capital needs greater than $800 million – an amount comparable to the value of pending claims – and a long waiting list of families in need of housing. Moreover, it lacks power to raise money by levying taxes.
Moore's firm is one of three retained by the housing authority to defend it against lead lawsuits. Since 2005 the authority has paid the three firms exactly $2,829,664.56, plus about $1 million in expenses for expert witnesses and depositions, said Cheron Porter, spokeswoman for the city's housing agency.
"They have all this money to defend against it, yet the money they spent could have resolved many of these cases," said Scott E. Nevin, a plaintiffs' lawyer with the firm of Peter T. Nicholl. As is customary, Nevin says he would collect one-third of any judgment.
Nevin and Moore clashed recently over a lawsuit that Nevin filed for plaintiff Brandy Few in November 2009. Nevin claims Moore repeatedly failed to provide lead paint records for the public housing unit where Few's grandmother lived, promising again and again to produce them at a later date.
Last week Baltimore Circuit Judge Althea Handy held a hearing on Nevin's request to compel Moore to provide the records. Nevin also asked the judge to fine Moore $500.
At one point, referring to the delays in the case, Handy told Moore, "This just has to stop."
"Understood," Moore replied.
"We can't go on like this," the judge added.
Antonio Fulgham's lawyer, David F. Albright Jr., calls the housing authority's refusal to pay judgments "ridiculous." He dismisses Graziano's claim that the authority lacks the means to borrow money and cannot seek a government bailout.
"If the housing authority really is strapped for money like they say they are, the government has to step in and help out," Albright said. "When you have all these poor, disadvantaged children being taken out of the productive mainstream of life, why not float a bond to help them out?"
Albright also represents Fulgham's 20-year-old sister, Brittany McCutcheon. She won a $2.2 million jury award that was later reduced to $1.32 million because of a state cap on noneconomic damages. Fulgham's judgment was reduced for the same reason.
As small children in West Baltimore, both McCutcheon and Fulgham had blood lead readings far above the 10 micrograms per deciliter "level of concern" set by the federal Centers for Disease Control and Prevention, according to their lawyer. Hers was 17; his was 28.
McCutcheon graduated from Frederick Douglass High School in 2009 but doesn't have a job. "I did see myself being a nurse, but I know it can't happen now," she said in an interview at Albright's office, holding her 15-month-old daughter, Za-Niya. "I have a reading level and writing level of ninth grade."
That leaves her "looking around for other little jobs" and feeling hurt. "I know that's something I really wanted to do," she said of her nursing ambitions.
The two siblings say they rely on their mother for financial support. If they ever collect from the housing authority, McCutcheon says she'll buy a car and a house. Fulgham, who has children of his own, says he'll buy a house, take care of his children and help his mother.
Fulgham has a first-grade reading level and is "mildly retarded," according to an expert hired by Albright. Fulgham said his dream of becoming a truck driver seems out of reach.
"I guess that's not going to happen for me at all," he mumbled with a downcast expression. "I can't even read a license book."
"Toxic tort" judgments against Baltimore housing authority
$2.593 million (Lead)
Source: Housing Authority of Baltimore City
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