WILKES-BARRE -- More than 2,000 people filed claims seeking a piece of $17.75 million Robert Mericle has set aside to pay those harmed by his involvement in the Kids for Cash scandal.
Of those, 1,614 will be entitled to up to $5,000 in base payments with more money set aside in an enhancement fund to compensate those who can prove they suffered more severely.
Numbers were broken down during a hearing before of U.S. District Judge A. Richard Caputo on Monday to determine whether a settlement agreement given preliminary approval in February will get final approval.
Attorney David Senoff detailed the effort by himself and other attorneys representing thousands of children who stood before former Judge Mark Ciavarella in juvenile court.
Ciavarella is serving a sentence of 28 years stemming from his acceptance of $1 million from Mericle, who built two private juvenile detention facilities where many of the juveniles were sent. Ciavarella has repeatedly rejected the kids for cash label, admitting he took the money but contending it had nothing to do with where he sent the children.
Senoff said about 7,300 notices were sent out to people believed to have any potential claim in the case, along with advertising in local papers and the establishment of a website to help people file claims. The search yielded 2,019 claims, 1,614 of which were determined to be entitled to receive benefits from the settlement.
Those receiving money -- and the amount they get – will be determined by which of several categories they fall into:
• Juveniles who were sentenced to probation only, and not to any facility, are entitled to $500 under the settlement. There were 106, for a total of $5,300. Senoff said attorneys had budgeted $410,000.
• Juveniles sent to a facility other than the two private ones Mericle built – PA Child Care and Western PA Child Care -- are entitled to $1,000 each. There are 197 of them, for a cost of $197,000, well below the $820,000 budgeted. Of those, 88 were sent to a facility for more than 90 days, which puts them in a subcategory that will get an additional $4,000, for a total of $352,000 for all 88.
• Juveniles sent to one of the two PA Child Care facilities, entitled to $5,000. There are 763, for a total of $3,815,000, which is more than the $3,650,000 budgeted. Some are eligible for additional money from the enhancement fund. Senoff proposed the shortfall be covered using the surplus in the first two categories. Any other surplus would go into the enhancement fund, initially set at $8.35 million.
• Parents who filed claims for reimbursement of any money they spent as a result of their child's appearance before Ciavarella. They are entitled to 100 percent of documented expenses. Senoff said there were 548 claims but that some will be duplicates caused by both parents filing for the same costs. The total cost will be $601,436, compared to $500,000 budgeted. The shortfall would be covered by a reduction in the money requested for attorney fees and costs.
The enhancement fund will be spent based on a system awarding points to juveniles who can provide documentation or other proof they were harmed more severely – emotionally or psychologically, for example. The point system is designed to make the decision as objective as possible, and to make the appeals process simpler.
Those who feel they did not receive as much as they were entitled to will be able to appeal to a special master, a retired judge appointed to determine the validity of their claims. Each point would garner an additional $1,194.
Testifying for the attorneys representing the children, University of Texas law professor Lynn Baker said that compared to settlements in similar cases, this one was extraordinarily good.
She said the response rate in claims was almost 48 percent when 30 percent is typically considered good, and that the point system for the enhancement fund was fair and objective.
Senoff also presented his argument for a request of about $3.6 million in attorney fees and another $707,920 in costs. The initial request was for $4.33 million total, but that would be reduced by the money used to cover the shortfall in reimbursing parents.
Senoff argued the total payment to attorneys would be about 24 percent of the $17.75 million, and payments to attorneys usually exceed 25 and even 30 percent in such large and complex cases.
He noted that, combined, attorneys for the children spent more than 35,000 hours working on a case that generated roughly 250,000 pages of documents.
Attorneys for Mericle agreed with the settlement terms, but a lawyer representing the two PA Child Care facilities and the company that managed them continued his efforts to get Caputo to reject the whole deal.
Attorney Bernard Schneider said the settlement, which excludes his clients, will make it difficult for him to defend them from lawsuits filed by the juveniles and their families.
He contended evidence gathered in making the settlement will not be available to him under the terms of the agreement, and he will not be told how much money each claimant receives – which could matter because the settlement calls for the payments made through the Mericle fund to be considered in any other payments made by other parties not involved in this agreement.
Senoff said the amounts will be available.
Attorneys for the juveniles contend Schneider and his clients have no standing to contest the settlement agreement. Caputo must also decide whether they do.
Caputo made no rulings during the hearing.