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These Guys Play Hardball!

From, Knoxville Tennessee:

 For the second time in a week a traffic camera vendor is suing local government because citations for improper right turns on red have been halted based on a new state law.

Redflex Traffic Systems Inc. on Monday filed suit against the town of Farragut and claims that without court intervention, hundreds of traffic violations will continue to go unprosecuted, which will affect traffic safety and deprive Farragut and the company of revenue that was agreed on in a contract between the two.

“As a result, Redflex and Farragut have lost thousands of dollars in revenue, and hundreds of traffic violations have gone unpunished,” the Redflex lawsuit states.

On Nov. 8, American Traffic Solutions Inc. sued the city of Knoxville on similar grounds.

From, Phoenix, Arizona:

TEMPE, Ariz. – A photo radar company is suing the City of Tempe for a bigger cut of its profits.

The city is being sued by Redflex, the company that builds and operates cameras. Executives at the company want a bigger cut of the profits from traffic tickets.

Photo radar cameras have been flashing in Tempe for three years. They’ve been targeted by protesters from Santa’s covering the cameras with sacks to the Easter Bunny covering them with eggs.

Through it all Redflex executives insisted the cameras were there for safety and not profit. Jay Heiler, with Redflex, says, “The technology does a wonderful job making us more attentive as we drive.”

Court documents now reveal Redflex and Tempe have been fighting over photo radar profits for months and now Redflex filed a breach of contract suit against the city over payments.

Speeders caught on camera are told they have two options: They can pay a $200 fine and receive points on their license or they can take a drivers safety course and avoid the fine and points on their license.

Redflex has a problem with option two because when people choose the driving class, Redflex does not receive money from that class fee.


California: Traffic Camera Firm Shakes Down City
San Bernardino, California officials point fingers at one another as traffic camera firm demands $1.8 million.

As municipalities around the country increasingly have second thoughts about continuing red light camera programs, the private companies in charge of the photo ticketing are turning up the heat. Redflex Traffic Systems announced to its Australian shareholders last week that it continues to adjust contract language, boosting the penalties for cities that turn their back on photo ticketing. Just such language has hit in San Bernardino, California where rival photo ticketing firm American Traffic Solutions (ATS) is threatening to impose an extra $1,896,202 fee to punish the city council for attempting to get out of the contract in March. Officials had already approved cutting a check for $175,000 to the company as compensation.

City leaders were shocked to find the penalty for early withdrawal from the contract may have been underestimated by a factor of ten. Police Chief Keith L. Kilmer blamed the mistake on the sloppy work of the city attorney’s office. The city’s legal team blamed Kilmer for providing bad information. In a February 1 memo, Assistant City Attorney Jolena E. Grider calculated the cancellation price as $975 per intersection multiplied by the number of months remaining from the original five-year contract. Grider’s memo, however, confused the term “approach” and “intersection.” Each intersection has four approaches or directions of travel. That means up to four individual cameras can be installed for each intersection.

“I asked police employees several times if installed approach was the same as intersection and was told numerous times that it was,” Grider wrote. “It was not until I received information from ATS a few weeks ago that I learned differently. All the information I received at the time I wrote and based the February memorandum on was from the police department and from no other source.”

Chief Kilmer blasted the city attorney for going to the press and trying to pass the blame for a legal mistake to his department.

“This information about contract terminology was not provided by the police department,” Kilmer wrote in an August 16 memo. “It was within the contract document itself, which I would assume that the city attorney’s office had some hand in preparing and reviewing on multiple occasions.”

The city attorney’s office fired back at Kilmer, insisting negotiations were under way with ATS to arrive at a “mutually beneficial resolution” and that the incorrect information in the February memo could not be used in a court of law.

“There is nothing to be gained by the city of San Bernardino by this type of finger pointing in his memorandum and the inaccuracies cannot be left uncorrected,” Jolena E. Grider wrote on August 17.

From (The Houston Chronicle) :

City Council approved a payout of at least $4.8 million Wednesday to settle a lawsuit and take down Houston’s controversial red-light cameras, finally ending a legal battle that began after voters banned the devices in a referendum 15 months ago.

The cameras were turned off and outlawed by council in August but have remained mounted at 50 intersections while the city’s camera vendor pursued breach of contract claims in federal court.

The settlement calls for the cameras to be taken down within 60 days.

To the end, the cameras continued to divide council members as they grappled with how to honor both a camera contract that runs through May 2014 and the voters’ mandate to rip up that contract immediately.

The settlement gives Scottsdale, Ariz.-based American Traffic Solutions a cut of the city’s collections on $25 million in outstanding violations.

The 13-4 vote in favor of the settlement means the city could pay ATS more than $12 million in the unlikely event that the city gets all 240,000 delinquent red-light runners to pay up.


Space and time don’t permit me to spotlight all of them, but believe me there are more.  And apparently Redflex doesn’t think it’s being tough enough!

Again, from

The company explained its hardball tactics in a February 25 report to shareholders on the Australian Securities Exchange.

“As a result of the macro economic challenges facing the US market throughout 2010, and the current politically challenging times, new contract executions have declined,” the Redflex report stated. “This financial year, Redflex has focused its efforts on strengthening its business model through tighter contract language, (and) more aggressive collection efforts in key markets.”


Why would little old Belmar think it can outsmart these guys when cities like Houston, Knoxville, Tempe, and San Bernardino all found themselves trapped?  Even with the most air-tight contract in the world, these guys could bankrupt us by dragging us through the courts.

Belmar’s entire municipal budget is around $13 million.  Goldman Sachs, ATS’s principle owner, probably spends more than that on their Christmas parties.  Do Belmar’s public officials really think we would have any chance of beating these guys?

And by the way, I haven’t even gotten to all the class-action lawsuits brought against municipalities by their own citizens.  Maybe I’ll write about that in a few days.



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