UM's cost from Anderson allegations: $10.7M and rising

Kim Kozlowski
The Detroit News

The University of Michigan has spent more than $10.7 million so far on legal fees, counseling and an investigation linked to the sexual assault accusations against the late Dr. Robert E. Anderson.

The bulk of it — nearly $5 million — has gone to the WilmerHale law firm for an investigation still underway into the nearly four decades that Anderson served UM, where he is accused of sexually abusing hundreds of former students, mostly men.

Those costs are just the beginning.

►Special report: How UM failed for decades to heed warnings about doctor's alleged sex abuse

At least 235 individuals have filed lawsuits in U.S. District Court, according to UM. The suits allege the university ignored complaints about Anderson dating to the late 1960s, allowing him to continue to come in contact with patients for decades.

But two lawyers close to the legal proceedings say approximately 800 alleged victims have come forward but not all have filed complaints to avoid burdening the court as mediation continues. Records in U.S. District Court in Detroit show lawyers have to offer a list of all plaintiffs for mediation to show UM its potential exposure.

Plans for mediation began in September between UM and lawyers representing the accusers, said former Attorney General Mike Cox, who filed the first lawsuit against the university. Dearborn-based attorney Robert F. Riley of Riley & Hurley, P.C. is mediating. The first session is scheduled for Friday, Cox said. 

Attorney Mike Cox speaks with other attorneys regarding alleged sexual abuse claims by their clients against former University of Michigan doctor Robert E. Anderson at the Mike Cox Law Firm office in Livonia earlier this year.

The legal process is aimed at reaching an out-of-court settlement between UM and the people who say they were victimized by Anderson, the former head of the University Health Service and team physician for the UM Athletic Department. Anderson retired in 2003 and died in 2008.

"Despite knowledge about Anderson’s misconduct, UM knowingly kept him in positions where he had direct and intimate access to prey upon college students and college athletes," according to the first lawsuit filed.

Timeline: Key events in Anderson's life, career and sex abuse case

Recent high-profile settlements involving a sexual predator include the historic $500 million settlement in May 2018 that Michigan State University agreed to pay the victims of former MSU and USA Gymnastics physician Larry Nassar for decades of abuse. However, the 535 women who came forward with claims are still attempting to resolve claims filed against USAG and the U.S. Olympic Committee.   

Because the number of alleged victims who have come forward in the Anderson case is larger, lawyers say privately they expect a settlement with UM to be larger than the one with MSU.

For now, the question is how UM will handle the accusers going forward.

John Manly, one of the lead lawyers in the Nassar case who is flying to Michigan from California this week for mediation, said UM has a decision to make: Will it respond like Michigan State did and "attack, persecute and inflict pain on the victims?"

Or, Manly wonders, will UM differentiate itself and treat accusers with respect? 

"Michigan should embrace the victims and own up to their responsibility," he said. "They allowed (Anderson) to assault victims. They owe the victims justice. We'll see what they do."

UM's mediation process is among numerous other developments since Robert Julian Stone came forward in February and shared his story of alleged assault by Anderson.

Since then, scores of accusers have spoken publicly and more than 460 people have filed complaints to UM regarding Anderson as of September on the hotline the university established, according to UM spokesman Rick Fitzgerald.

Besides those who have sued, other victims are represented by lawyers across the country, Manly said.

UM has hired four law firms since allegations have emerged about Anderson. Two of them have been paid to defend the university against the lawsuits.

UM paid $516,931 to Bush Seyferth, a Troy-based firm that filed motions to dismiss claims against the university. UM replaced that firm in May with Jones Day. So far, UM has paid the Cleveland-based firm nearly $3.8 million to defend the university, Fitzgerald said.

UM also hired law firms to defend two UM officials who allegedly were alerted to Anderson's behavior years ago: Thomas Easthope, UM's former associate vice president for student services, and Henry Johnson, UM's former vice president for student services.

UM has retained Foley & Lardner to represent Easthope, and paid the firm $314,598.25, Fitzgerald said.

The university has retained an attorney at Butzel Long to represent Johnson, but FItzgerald said no bills have been paid yet. 

Shortly after victims began to lodge allegations against Anderson, advocates called on Michigan Attorney General Dana Nessel to investigate what happened at UM during the nearly four decades of Anderson's tenure. But Nessel said her office would not investigate unless the university made a binding commitment to waive privilege.

UM has since hired two other law firms to investigate the allegations against Anderson.

The university paid $1.1 million to Steptoe and Johnson, the first firm it hired. UM dropped Steptoe and Johnson in March after learning the firm had defended two prominent men accused of sexual abuse, the late financier Jeffrey Epstein and film director Roman Polanski.

UM has since hired the WilmerHale law firm to investigate the Anderson case. Officials have said it will be an independent investigation, with findings released to the public and the Board of Regents at the same time. U.S. District Judge Victoria Roberts has said the firm expected to release the report in October.

Fitzgerald said it's not clear when the law firm will issue its report.

"WilmerHale will make that decision when it has completed its investigation," Fitzgerald said. "The WilmerHale work, as you know, was paused for two months this summer by the court."

Costs for the WilmerHale investigation so far have reached $4.9 million.

UM also hired WilmerHale to investigate sexual misconduct of former Provost Martin Philbert, and release a report. UM paid the firm almost $3.9 million for its work linked to Philbert, Fitzgerald said. 

The university also has been providing free counseling to victims, with costs totaling $29,690 so far, according to the university. 

It also has taken steps to prevent any more sexual abuse cases.

"The university has made substantial changes over the years in its sexual misconduct policies and procedures," Fitzgerald said.

"The most recent change was in August, when the university put in place an interim sexual misconduct policy that applies to all students, faculty and staff on all three UM campuses," he said.

Also in August, the university's Board of Regents said it planned to hire outside experts to assist the university to "create a culture where reports will be heard and lead to appropriate action," though it has taken no action yet. 

UM is studying the findings of a report WilmerHale produced on sexual misconduct allegations against Philbert.

"We expect further recommendations from WilmerHale at the conclusion of its Anderson investigation," Fitzgerald said.