SilverWing ordered to pay attorneys fees

SANDPOINT — A U.S. District Court judge is ordering the developers of a fly-in housing project next to Sandpoint Airport to pay Bonner County $727,000 in attorneys fees after most of the company's claims in federal court were rejected.

Bonner County sought nearly $1 million in fees from SilverWing at Sandpoint, which sued the county over claims that it was misled about a runway relocation project and approval of through-the-fence access to airport grounds. Counsel for SilverWing argued that the county violated the company's civil rights via inverse condemnation and denial of equal protection under the law.

The Federal Aviation Administration notified the county in 2008 that the airport was deemed out of compliance because it allowed SilverWing through-the-fence access to the facility without FAA approval.

The county moved for summary judgment, arguing that SilverWings federal and state law claims should be dismissed as a matter of law. The county maintained that a state claim of breach of the covenant of good-faith dealing should be dismissed because it was acting in accord with FAA requirements that preempt state law.

Judge Edward Lodge dismissed all but one of SilverWing's claims in 2014.

Lodge ruled that federal law did not preempt SilverWing's state law claim of primary estoppel, also known as detrimental reliance. The company's counsel argued that it detrimentally relied upon the county's promise that it would it would not shift the runway.

The sole remaining claim was remanded to Idaho's 1st District Court for further proceedings. A three-day jury trial is set for November, although the county is again moving for summary judgment to dismiss it.

Meanwhile, the county sought nearly $1 million in attorney fees that were spent defending against SilverWing's suit, which county officials said could cost taxpayers up to $20 million if the county did not prevail in court.

SilverWing's counsel argued the fees sought by the county were excessive and unreasonable, federal court records show.

Lodge ruled on Tuesday that the bulk of the fees were justified due to the complexity of the litigation and the need for attorneys who specialize in a aviation-related litigation.

County officials vowed to vigorously defend against the suit and court records show that there was intensive trial preparation, which included a mock trial, outside litigation consultations and several strategy meetings.

But Lodge ruled that the county was too zealous in its pretrial preparations. The court noted that county moved for summary judgment and resumed expensive and extensive pretrial preparations even though the motion had the potential to jettison some of the claims prior to trial.

“The court finds that most of these hours to be grossly excessive and unreasonable,” Lodge said in the 19-page ruling.

Lodge ruled, however, that most of the county's expenses were justified.

“This matter has been pending in this court since 2012 and has required a considerable amount of labor by both parties as reflected by the filings in the record,” Lodge wrote. “The case presents difficult and novel issues which required the county to retain the services of outside counsel who had the requisite skills and experience to perform the legal service properly.”