The long-running lawsuit waged by Fresno contractor Stephen Davis against Fresno Unified School District and Harris Construction won’t be over anytime soon, despite a trial victory by the district and its contractor.
That’s because Davis took the first step in court this week to appeal the ruling that the court issued against him last month.
The backstory: Fresno County Superior Court Judge Jeffrey Hamilton Jr. ruled last week that Harris Construction did not violate state law with its contract to build Gaston Middle School for Fresno Unified.
- The lawsuit has been litigated in court for the past 13 years and finally went to trial last year on the actual matter of the case. Davis originally filed the lawsuit claiming Harris Construction broke state law with the lease-leaseback agreement that it had with Fresno Unified for Gaston Middle School.
- Lease-leaseback agreements used to allow school districts to lease land to builders for $1 per year while the builder would construct the school. The developer would then lease the new facilities back to the district to recover costs. The California legislature ended the practice in 2016, a handful of years after Davis filed the lawsuit.
- Harris Construction had a $37.6 million contract to build Gaston Middle School and took $1.1 million in profit from the deal.
- Fresno Unified had pre-qualified Harris Construction under the lease-leaseback system in 2011 and also had a pre-construction agreement with the builder. Davis argued that the district used lease-leaseback to illegally avoid competitive bids, but Hamilton ruled otherwise.
- Harris Construction has not done any business with Fresno Unified since the lawsuit was filed, while Davis – who owns Davis Moreno construction – went on to do over $180 million in work for the district.
- Hamilton wrote in the ruling that Davis’s true motivation in the lawsuit was to eliminate Harris Construction from being a competitor.
The big picture: Davis’s attorney Kevin Carlin filed a notice of appeal in the Fresno County Superior Court on Tuesday to Hamilton’s ruling.
- The notice itself does not come with any argument for the appeal and is simply the first step to filing an appellate brief, which will presumably follow in the coming weeks if Davis continues down this path.
What they’re saying: Harris Construction President Mike Spencer said the company is confident that it will prevail against an appeal.
- “Unlike the two previous appeals, this time there was a full trial where all the facts were laid out,” Spencer said. “Mr. Davis had every chance to present his case, and he lost; plain and simple. Based on the thorough and well-reasoned decision from the trial court, Harris is confident we will ultimately prevail.”
- Spencer also said Harris Construction will file a motion to recover its legal fees from Davis. The legal fees in the lawsuit have totaled over $1 million at this point.
- “After nearly 13 years, perhaps Mr. Davis will finally realize it is time to stop wasting our taxpayer money on this case – money that we can all agree would be much better spent on our community’s children,” Spencer said.
