An attorney representing local contractor Stephen Davis in his longstanding lawsuit against another Fresno construction company and Fresno Unified School District over a decade-old contract to build Rutherford P. Gaston Middle School is urging School Board members to drop their support of Harris Construction Co. and to join Davis in seeking reimbursement from Harris.

Attorney Kevin Carlin, in a letter dated Tuesday and addressed to the trustees, said the contract’s cost plus interest now totals nearly $63 million. The letter was sent via email to GV Wire, district officials, and attorneys involved in the lawsuit.

Carlin said in the letter that he wants to correct what appears to be a misunderstanding on the part of School Board members.

“Based on your public comments at the August 9, 2023 Board of Education meeting it seems you are under the misunderstanding that Davis is suing to get money from the District. Additionally, you incorrectly think Davis is forcing the District to spend the money on attorneys’ fees defending against Davis’ lawsuit. You have apparently been misinformed by someone on both of the foregoing. The purpose of this letter is to correct your misunderstanding and ask you to direct the District to cooperate with and assist Davis in the remainder of this lawsuit and specifically at the Trial that is scheduled to start on March 18, 2024.”

The letter is the latest twist in a lengthy battle over the district’s award to Harris Construction of a lease-leaseback contract to build Gaston, one of many such lease-leaseback contracts awarded by the district but the only one to face a legal challenge.

Davis’ status as the lawsuit’s plaintiff is as a private citizen and Fresno Unified taxpayer, and not as the head of his construction company, Davis Moreno.

Legal Appeals Favor Davis

Decisions by the Fresno County Superior Court that found in favor of Harris Construction and Fresno Unified in dismissing Davis’ suit were later overturned by the Fifth Circuit Court of Appeal and California Supreme Court. Both the appellate and Supreme Court ruled that the contract that went to Harris could not be validated because there was no competitive bidding.

Carlin’s letter comes even as the district, Harris, Davis, and the law firm of Atkinson Andelson Loya Ruud & Romo are preparing to enter into a mediation agreement to settle Davis’ lawsuit, using an American Arbitration Association mediator. According to one source, the sides have been in mediation for nine years without reaching a settlement.

Harris Construction President Michael Spencer noted that the Gaston construction contract was drawn up by Fresno Unified and the district’s attorneys, one of 25 such agreements to 11 different general contractors, six of whom received preconstruction agreements.

“What is at issue now is a ‘legal’ argument – Did those 25 LLB agreements comply with the CA Education Code? This question has nothing to do with Harris Construction. Fresno Unified and their lawyers wrote all 25 agreements,” he said in a prepared statement provided to GV Wire.

“All of us at Harris Construction would like to see this litigation resolved, but we had little to do with why we are here now. We believe Fresno Unified and their lawyers could have avoided this dispute early on, even before construction started.”

Expecting Harris to repay money that was paid to subcontractors and vendors who worked on Gaston, a project that Fresno Unified has never sought repayment on and that the district is enjoying the use of today, would be “unjust,” Spencer said.

Carlin’s letter noted, however, that the appellate court ruled that the district’s contract was a conflict of interest because Harris had served as a consultant and aided the district in creating the terms of a contract that was subsequently awarded to Harris and not put out to competitive bid.

Officials with the district did not immediately respond to a request for comment about Carlin’s letter. And, Carlin declined to comment further to GV Wire.

The letter from Carlin emphasizes that the goal of Davis’ lawsuit has been to return funds to the district that Davis contends should not have been paid to Harris in the first place.

However, court records unearthed by GV Wire allege that Carlin previously offered to settle the lawsuit for an undisclosed “seven-figure” amount that he later told GV Wire was for his legal fees and not for payment to Davis.

Davis Moreno Awarded Many Contracts Since Gaston

Trustees noted last summer that Davis Moreno has been well compensated by the district in subsequent years with construction contract awards. They leveled criticism that his lawsuit is causing the district’s legal fees to mushroom.

The district has declined to disclose how much has been spent so far to defend the case, but it’s estimated at more than $1 million.

Carlin’s letter Tuesday said the district doesn’t have to keep spending on legal fees if it would cease siding with Harris Construction.

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And, the letter states that the School Board members, as trustees of public funds, are required to assist Davis in seeing that the Gaston contract amount is repaid to the district.

“Likewise here, each of you as members of the Board of Education are the ‘legislature’ of the Fresno Unified School District such that the above referenced admonition and obligations of the California Constitution and the California Supreme Court prohibiting gifts of public money apply equally to you,” Carlin wrote.

Kevin Carlin’s Jan. 30, 2024 letter to FUSD School Board Members