Klein Settles for Lower Sum in Davis Suit

On May 2, Eugene Klein’s nag, On The Line, ran a distant 10th in the Kentucky Derby.

Klein, the combative and colorful former owner of the San Diego Chargers, doesn’t like finishing out of the money. This week, rather than run that risk, he decided to accept a judge’s order slicing his $10-million court victory over Al Davis and the Los Angeles Raiders to a mere $2.04 million.

A San Diego County Superior Court judge last month had given Klein the choice of going along with the reduced verdict in his malicious prosecution case against Davis, his longtime nemesis, or facing a new trial and the attendant uncertainties of starting the litigation over again.

Klein figured he might as well quit while he was ahead.

Charities the Losers

“We beat him. We won. He was found guilty of malicious prosecution,” Klein said Wednesday. “All the money I received I had publicly stated was going to charity. Unfortunately, the charities in San Diego won’t get as much as they would have gotten. But he was roundly and soundly beaten.”

Klein charged in a civil lawsuit that Davis in 1981 had maliciously singled him out as a defendant in the Raiders’ hallmark antitrust case challenging the National Football League’s refusal to let the team move from Oakland to Los Angeles.

The Raiders won that suit, but a judge already had dismissed Klein as an individual defendant. Klein, meantime, blamed Davis for a heart attack he suffered while testifying in the case in a Los Angeles court.

The San Diego lawsuit ensued. After a lengthy trial punctuated by testimony from a coterie of sports celebrities, a jury granted Klein a $5-million compensatory verdict in December and an additional $5 million in punitive damages in January.

Davis and his legal squad, led by former San Francisco Mayor Joseph Alioto, asked Judge Gilbert Harelson to reverse the verdict or order a new trial, arguing that the $10-million judgment was unsupported by the testimony and that there had been misconduct by jurors.

But Harelson threw the parties a wobbler. The verdict against Davis and the Raiders could stand, he ruled last month, if Klein accepted an 80% reduction in the damages. If Klein refused, Harelson said he would order a new trial.

Back in Davis’ Hands

Klein’s decision punts the ball back into the hands of Davis and his lawyers. They can let the case die and hand over the $2.04 million. But that course, lawyers say, is complicated by litigation between Davis and his insurance company, which is reluctant to pay the judgment.

Davis’ other option is to appeal the case. If he does, however, Klein can file a counter-appeal seeking to have the full, $10-million judgment reinstated.

Davis and his lawyers--scattered as they are in San Diego, El Segundo, Los Angeles, Ventura and San Francisco--haven’t yet gotten together to determine what to do.

“The decision is to talk about it some more,” San Diego lawyer Gary Bailey, one of Davis’ attorneys, said Wednesday.

Klein said he is not worried that he might lose if the case is retried. While he acknowledged some initial disappointment at the reduction in the scope of his victory, Klein said it nonetheless remained a formidable win.

“A couple of million dollars is nothing to be sneezed at,” he said. “The bottom line is we whipped his butt.”

The multimillionaire businessman, who sold the Chargers in 1984 to focus his energies on real estate development and horse racing, said he does, though, plan another Run for the Roses.

“We’ll win the Kentucky Derby,” Klein vowed with a laugh.