Callahan's Karoly Connection

This comes directly from LV Congressman Charlie Dent's camp. Usually, when I get a news release, I reword it. Not this time. It makes a point that needs to be made. This will also make some people angry with me. Oh, well.

The recent conviction of attorney John Karoly by a Federal court ends a chapter on one of the Lehigh Valley’s most controversial trial lawyers. But no Karoly retrospective is complete without highlighting his greatest “success” – which came at the hands of John Callahan’s ineptitude and cost Bethlehem taxpayers more than $8 million.

In 2004, the City of Bethlehem was the defendant in a civil trial waged by John Karoly over the 1998 shooting of suspected drug dealer John Hirko by Bethlehem police. After months, the jury deadlocked – meaning the city as defendant would win the case. But instead of accepting a hung jury – and forcing Karoly to settle or start his lawsuit over again – Callahan inexplicably allowed a split-verdict “poll” vote of the jurors. The city lost the vote, 10-2. That’s right; John Callahan snatched defeat from the jaws of victory.

At the time, Democratic City Council President Mike Schweder called Callahan’s action “the most stupid decision anyone in my lifetime has made.” 1 Callahan then met with Karoly to negotiate a settlement, and in the end Bethlehem taxpayers had to pay $7.89 million plus other costs.

What were Callahan’s excuses? ''Our defense team confidently believed we were looking at a favorable verdict,'' Callahan told the Morning Call at the time.1 Of course, the city’s “defense team” primarily consisted of the city’s former insurance company, which only stood to lose $500,000 regardless of the final outcome, with city taxpayers on the hook for anything over that amount. During the six-plus months of the Hirko trial, Callahan was a City Councilman, mayor-elect and ultimately mayor. Yet as far as anyone can tell, he did not even once bother to stop in and observe the proceedings of the Hirko trial at Allentown’s Federal Courthouse for himself.

Despite this lack of first-hand knowledge, and despite Karoly’s reputation as an aggressive attorney, John Callahan felt that he and his solicitor were “perfectly capable of holding our own with John Karoly.”2

And after all was said and done, Callahan proposed a bond issue to pay for the settlement – conveniently, with the largest payments coming AFTER his time as mayor would be long over, and adding $800,000 more in costs to the taxpayers. 3

“The Hirko decision was John Callahan’s first opportunity to make an important decision on behalf of Bethlehem taxpayers, and unfortunately it set the pace for those that followed – he failed to do his due diligence, exercised poor judgment, displayed arrogance, negotiated poorly, and ultimately cost the city money it didn’t have,” said Dent campaign manager Shawn Millan. “Then he tried to pass the cost for his own failure onto future generations. No wonder Nancy Pelosi wants him in Washington.”

But lest anyone think Callahan’s performance wasn’t appreciated by some people, he got high praise from one individual – John Karoly, who said Callahan had "political courage.”

Notes:

1 Matt Assad, “City bet judge, jury were on its side,” the Morning Call, April 5, 2004

2 Elliot Grossman, “How Hirko settlement came to be,” the Morning Call, April 1, 2004

3 Chuck Ayers, “Hirko deal means job cuts,” the Morning Call, April 20, 2004