Deputy attorney, developer named in antitrust lawsuit
March 22, 2006
County Chief Civil Deputy Attorney David Thomas was "one of the chief architects" while Basin developer Jim Doilney was an "initial" collaborator in the illegal scheme to run a private water company in western Summit County out of business, documents filed Friday in Silver Summit Third District Court claim.
Thomas also serves as a state senator for Weber and Davis counties.
The motion filed last week is perhaps the most revealing yet about Summit Water Distribution Company’s allegations that in 2001 the Summit County Commission conspired with staffers and private developers to take over the business through eminent domain.
"[Thomas] is now known to have been one of the chief architects of the arrangements and conspiracies to restrain competition and commerce in the relevant market, to eliminate Summit Water as a competitor in the market and to establish [Summit County] as a monopolist," Summit Water’s new motion states.
The court papers filed by Summit Water seek to amend a lawsuit filed in 2001 against several county officials that claims their failed attempt to condemn the private water company, among other actions, violated the Utah Antitrust Act. Though not initially named as defendants in the case, the amended court complaint now also seeks monetary damages from Thomas and Doilney.
Defendants named in the lawsuit, so far, include former Summit County Commissioners Shauna Kerr, Patrick Cone and Eric Schifferli and Mountain Regional Water Special Service District employee Doug Evans.
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"Frankly, until the judge rules on it [Summit Water] can’t amend the complaint. They do not have permission to do so at the time being," Summit County Attorney David Brickey said, adding that the period to amend the lawsuit has expired. "It’s been our belief that they cannot amend the complaint because they’re late."
At issue is whether the Summit County Commission was attempting to monopolize water delivery in Snyderville when the county’s Mountain Regional Water began acquiring troubled West Side water companies about six years ago.
"They put Dave Thomas in because if you name Dave Thomas as a defendant, you’re entitled to see what Dave Thomas said to his clients, in this case Mountain Regional and the commissioners," Brickey said. "They want to breach and go after Dave’s records, Dave’s notes, Dave’s personal communication."
According to Summit Water’s amended complaint, which is attached as an exhibit to last week’s motion, when Summit County entered the water market there were 11 providers in the Basin.
"The competition was intense and healthy, resulting in low prices to developers and water customers," the amended complaint states.
Still, in 2001, then Summit County Commissioners Kerr, Cone and Schifferli moved to condemn Summit Water, which had been operating in Snyderville for 25 years.
Summit Water filed the antitrust lawsuit after a judge ruled against the commissioners in their attempt to eliminate the business.
Since that decision, the county has incurred about $33 million worth of water-related debt purchasing troubled water systems and some of its customers have watched their rates more than triple, Summit Water attorney Robert Campbell claims.
Along with implicating Thomas in the alleged scheme, Campbell now also blames developer Doilney. In exchange for providing water for Mountain Regional, Doilney received "millions of dollars for unproven water resources, the reservation of hundreds of water connections for developments and home sites which had been neither approved nor permitted and favorable development considerations from Summit County," the March 17 motion states.
Doilney says he can’t comment on pending litigation.
According to the amended complaint, commissioners made a similar deal with Promontory developer Rich Sonntag.
The Pivotal Group spent almost twice as much buying water for the gated Promontory subdivision, as it would have by connecting to Summit Water’s system, the lawsuit states, adding "[Sonntag] stated publicly that he considered the increased cost of securing water for Mountain Regional the ‘price of admission’ for increased building lot density and development approvals from Summit County."
"Our lawsuit is about basic fairness and honesty in government. We’re very concerned about many of the things that have gone on, not only things that have hurt Summit Water but have hurt the citizens," Summit Water spokesman John Flitton explained. "There has clearly been favoritism and there have been developers that have profited greatly because of the county’s desire to monopolize water in the Basin."