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Cable TV legal bills top $770,000

Wednesday, January 10, 2007

By MICKEY POWELL - Bulletin Staff Writer

The city of Martinsville will pay a Richmond law firm another $450,000 for legal assistance in its failed bid to buy area cable television franchises.

Total city legal expenses toward the failed cable acquisition so far have amounted to about $774,143, based on information city officials have provided to the Martinsville Bulletin. In October, officials estimated that the city would pay $775,000 to $875,000 toward the acquisition attempt.

City Attorney Eric Monday told the Martinsville City Council on Tuesday that he recently received a bill from Hunton & Williams for $450,000 "and some odd cents." He was unable to remember the exact figure.

"It is a legitimate bill," Monday said, adding that it was not padded with any questionable expenses.

He said the firm deducted from the bill about $30,000 owed for setting up Martinsville Cable Inc., a nonprofit entity that would have run the franchises.

Councilman Ron Ferrill asked if Hunton & Williams had "moved to dissolve" Martinsville Cable. Monday replied that he does not know. Ferrill told him to handle the dissolution himself.

Monday added he does not think the firm would be willing to further reduce the bill, but he will try to persuade it to.

The latest bill is in addition to a previous bill sent by Hunton & Williams for a little more than $261,003. Including both bills, the city will pay the law firm about $711,000.

The city tried to acquire the Martinsville and Henry County cable franchises from Adelphia, which is in bankruptcy proceedings. The nation's largest cable system operator, Comcast, now owns and operates the area franchises.

A U.S. District Court judge in August refused to let Martinsville attempt to buy the system, saying the city acted "brazenly" and with disregard of its own ordinances during the attempt.

Had the city bought the franchises, revenue from subscribers would have made up for revenue lost when the city landfill closed last year, city officials have said.

Monday emphasized that the money for the legal work, which is being taken from the city's reserve funds, is being paid to Hunton & Williams, not to him.

A transfer from the fund balance to cover cable expenses is expected to be considered during the council's next meeting Jan. 23.

"It pains me a great deal ... (that) all of this money has been flushed away by the city" with no return on the investment, Monday said.

Ferrill said he would "have a great deal of difficulty" supporting the city entering another contract with Hunton & Williams.

Hunton & Williams still is representing the city before the bankruptcy court in Martinsville's bid to collect money from Adelphia for, according to Monday, allegedly breaching its franchise agreement by moving its headend - the place where over-the-air and satellite signals are received for distribution - to Danville.

So the city could get another bill from Hunton & Williams, but it should be relatively little compared to expenses currently being paid, Monday said.

Is he optimistic about the city receiving any money from Adelphia?

Monday said he is "coldly realistic." He refused to say whether that means he is not optimistic, but he added "I certainly know how successful we've been so far."�


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