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To defense lawyers trying to keep San Francisco Housing Authority administrator Gregg Fortner out of jail, their client is caught in an untenable intersection of federal and state law. But as plaintiff lawyer Stephen Murphy tells it, Fortner has been dragging his feet and protecting his agency’s funding by refusing to pay a 2001 judgment in favor of a client of Murphy’s who won a sexual harassment case against the agency. So after issuing a contempt order against the San Francisco Housing Authority earlier this month, Judge Ernest Goldsmith reconvened the parties Friday to determine if he should send Fortner to jail and order sanctions, as Murphy has requested. And Goldsmith seemed to start off by aligning with Murphy’s interpretation that Fortner had dragged his feet. Reviewing a letter Fortner wrote about a year ago to the regional office of the federal Department of Housing and Urban Development asking for help resolving some $13 million in remaining judgments, Goldsmith turned to the lawyers for the housing authority. “I could comment for half an hour about the tone of this letter, and the extent to which it asks for payment of the judgments,” he said with evident skepticism. “Are you submitting this as evidence of the good faith?” Goldsmith pointed to part of the letter in which Fortner explained that the housing authority could not use any existing or anticipated funding, even if HUD allowed it, because using operating funds to pay the judgment would prevent it “from carrying out its fundamental mission,” to provide affordable housing in the city. “In the next to last paragraph, he says don’t give us permission” to pay, Goldsmith said. “We don’t have to debate it. It’s clear on its face.” The judge did not ultimately decide Friday whether to force the housing authority’s hand. With testimony dragging on, Goldsmith continued the hearing until mid-July. Deborah Drummer was originally awarded $75,000 plus attorneys fees in her sexual harassment case. But due to the courtroom fights over the payment, Murphy said her claim has since ballooned to approximately $650,000. And that’s the smallest of three court judgments different plaintiffs are still trying to collect from the agency in San Francisco Superior Court � the largest of which is $12 million. In all three of those cases, the plaintiffs long ago won writs of mandate at the trial level ordering the agency to pay up, and the First District Court of Appeal upheld all three of those orders last year. On Friday, the lawyers for the housing authority tried to persuade Goldsmith that Fortner has done his best, but said the local housing authority can’t write a check to pay any of the judgments without approval from HUD. “Once you take the federal government’s money, you are bound to follow the rules and regulations of the federal government [to spend] that money,” said Gary Lafayette, of Lafayette & Kumagai. To do otherwise would break the law, he argued. “By holding this man in contempt, restraining him, you’re basically saying, ‘You stand in jail until you take an action that requires you to spend 10 years in [federal] prison,’” Lafayette told Goldsmith. On occasion, tension seemed to surface between the housing authority’s counsel and the judge, or between Fortner and Murphy, when the administrator was on the stand. Disagreeing with the way Goldsmith was reading one document, Lafayette stopped himself mid-sentence, commenting that he was trying to avoid using the words, “with all due respect.” To that, the usually soft-spoken Goldsmith replied, “All I want you and your client to respect are the laws of the state of California. I don’t care about me.” And as Murphy grilled Fortner about the lengths to which Fortner had gone in order to pay the judgment, the frustration seemed mutual. “Have you ever submitted a request to HUD that your operating expenses be used to satisfy the Drummer judgment?” Murphy asked. “No, we have not,” Fortner replied. At various times in his testimony, he emphasized that he has little control over how much federal money trickles down to his agency, and that he has to “deal in reality.” The housing authority, which operates 6,300 housing units, has an annual budget of about $220 million, $27 million of it for operations, Fortner said. In the roughly five years he has worked there, he testified that funding has been stretched so thin that staffing has dropped from 535 people to 395. “When we’re dealing with lives � where would you put the priority?” he asked. Murphy, set off by that comment, responded by saying he too was concerned about his client’s life, given that she was sexually harassed by another employee at the agency. By the end of the hearing, Lafayette had repeatedly pointed to a letter the housing authority received from HUD on Thursday, saying his clients intended to follow up on it � in good faith � between now and mid-July. “I hope you can,” Goldsmith said. “But then again, actions speak louder.”

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