HomeMy WebLinkAbout05-03-2016 Item 07 Stericycle Settlement
Meeting Date: 5/3/2016
FROM: Christine Dietrick, City Attorney
Prepared By: Jon Ansolabehere, Assistant City Attorney
SUBJECT: NOTICE OF SETTLEMENT AGREEMENT; UNITED STATES ET AL. EX
REL. PEREZ V. STERICYCLE, INC. ET AL.; CIVIL ACTION NO. 1:08-CV-
2390; UNITED STATES DISTRICT COURT, NORTHERN DISTRICT OF
ILLINOIS
RECOMMENDATION
Approve and authorize the City Finance/IT Director to accept and deposit the settlement checks
thereby consenting to the provisions of the settlement agreement between Relator Jennifer Perez
and defendant Stericycle, Inc.
DISCUSSION
On March 29, 2016, the City Attorney’s Office received two letters from the California Attorney
General Office informing the City that it was entitled to certain settlement funds related to the
Perez v. Stericycle, Inc. case in the total amount of $24,493.31. These funds stem from a
settlement agreement reached in a False Claims Act whistleblower complaint against Stericycle
Inc., alleging that this company improperly increased its service price to certain governmental
customers from January 1, 2003 until June 30, 2014, without the consent or contractual
authorization of such customers, resulting in an overpayment for certain products and services.
The total settlement amount is $28.5m and the above amount represents the City’s pro-rata share.
The proposed settlement terms are standard and straightforward. By accepting and depositing
the checks, the City agrees to waive and release Stericycle, Inc. from any claims of overcharging
the City for products and services for that period of time, as asserted in the underlying lawsuit.
It should be noted that the City, as well as many other local agencies, were not included as
plaintiffs in the complaint. However, as stated in the letter from the Attorney General, during
negotiation the settlement was expanded to provide relief to local government and that the
amount of the checks represent approximately two times the amount of estimated losses.
FISCAL IMPACT
The checks will be deposited into the City’s General Fund as miscellaneous revenue.
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ALTERNATIVES
1. Do not authorize the Finance/IT Director to accept and deposit the settlement checks.
This is not recommended because the City is not actively pursuing a claim against
Stericycle, Inc. and, as noted by the Attorney General’s Office, the amount of this
settlement amount exceeds the City’s estimated loss.
Attachments:
a - Stericycle Settlement.City of SLO
b - Stericycle Settlement.Fire
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