City Won’t Pay Fired Officers’ Legal Fees : Policy: Newport Beach cites state law in refusing to pay for defense of police chief and captain who are accused of rape and sexual harassment.

City officials announced Thursday that they will no longer pay the legal bills of fired Police Chief Arb Campbell and Capt. Anthony J. Villa, who stand accused of rape and sexual harassment by 10 current and former female employees.

Under state law, cities can refuse to pay for their employees’ defense if a lawsuit’s allegations concern actions outside the scope of the employees’ job, involve malice, or present a conflict of interest between the city and the accused individuals.

City Atty. Robert Burnham said all three of these reasons contributed to the city’s decision to withdraw payment of Campbell and Villa’s legal fees, which have already topped $13,000. He said the city’s specific policies against sexual harassment and discrimination help support their decision.

“While it might be magnanimous on our part to pay those bills, it’s no longer in our interest to continue to pay those costs,” City Manager Kevin J. Murphy said, adding that the city will not pay any punitive damages awarded in the lawsuit. “We have an obligation, certainly, to our employees. But we have a larger obligation to the people who pay our bills, and that’s the taxpayers.”

The city is also named as a defendant in the lawsuit filed Sept. 24 but has retained separate counsel and plans to mount a distinct case. Bruce Praet, the attorney the city hired to defend Campbell and Villa, said he will stick with the case regardless of who finances it.

“I’m not going to worry about getting paid right now,” he said. “I’m not going to abandon my clients when I believe in them.”

Los Angeles attorney Jeff Epstein, who represents Campbell and Villa in separate legal actions, called the city’s refusal to fund the defense an “incredibly stupid decision.” He plans to file a legal action next week to force the city to pay Praet’s fees.

Praet, a former Orange police officer, and Epstein both feared the message the city was sending to other Police Department employees, who are often subject to legal action for excessive force or other potential wrongdoing. It is “extremely rare” for a city not to defend employees, Epstein said; indeed, Burnham confirmed that among dozens of past cases involving Newport Beach police officers, only twice did the city not pay legal fees.

“If I’m a police officer for the city of Newport Beach, I would be very reluctant to take any actions I might normally take that I might be sued for, because I don’t know if the city’s going to back me up,” Epstein said. “Why should I go out of my way?”

To ward off such worries, Murphy on Thursday reassured acting Chief Jim Jacobs and Detective Tom Tolman, who is the police association president, that employees will still be supported in lawsuits stemming from their employment.

Lawyers on both sides of the case agreed that Thursday’s decision, along with other steps taken by the city, weaken the defense against the women’s lawsuit.

In December, the city’s own investigator concluded that “a trier of fact might find” sexual harassment at the Police Department, and later that month Murphy fired Campbell and moved to fire Villa. Then, last week, city officials offered cash awards to other female employees who had suffered harassment if they promised not to join the lawsuit.

“It certainly recognizes that some repugnant conduct happened to women working for the Police Department, on the watches of Campbell and Villa,” said Steven Pingel, the women’s lawyer. “The paradox is that the city wants to say the city has no, or little, responsibility.”

But Pingel said the city remains responsible.

“The city was the employer, and the sexual harassment and the failure to take action about it rests in the lap of the city,” he said.