Six days before the John Hirko Jr. settlement, Bethlehem Mayor John Callahan and lawyers involved in the negotiations made a key decision: They agreed that the talks would be about more than just money.

Both sides acknowledged that the police force had to be improved. And both sides wanted to prevent a recurrence of the deadly 1997 drug raid that led police to shoot Hirko 11 times.

Callahan told Hirko family lawyer John Karoly Jr. that the city was willing to make police reforms part of the settlement, that the city had gotten the message that the police force needed reforms.


''We don't need a $30 million verdict,'' Callahan told Karoly. ''You don't need to send a $30 million message to the taxpayers of Bethlehem.''

It was something Karoly and his clients had been waiting to hear for seven years — that city officials recognized police had erred during the disastrous raid.

Without that new direction in the settlement talks — and without the willingness of Karoly's side to compromise financially — the case might not have been settled last week. The city would have continued with the trial, risking a huge damages verdict.

For Karoly and his clients, the breakthrough meant their efforts would contribute to improving Bethlehem's police force without causing excessive financial hardships on the taxpayers.

''We were able to do with the settlement what we couldn't do with the verdict,'' Karoly said, referring to the reform commitments. The settlement also requires the city to pay $7.89 million to the plaintiffs.

Callahan, who had been in office only two months, would later apologize in person to Karoly's clients — Hirko's mother, fiancee and landlord — for the actions of police. That act, only hours before the settlement was reached, reinforced in their minds that Callahan was sincere about changing the police force.

Callahan used two of his strengths — his ability to communicate with people one on one and his willingness to admit mistakes — to bring an end to a six-month trial without bankrupting the city.

Haggling over a number

Before the trial, circumstances had made it exceptionally difficult to settle the case. Karoly was seeking $20 million, but the city had only $500,000 of insurance coverage.

U.S. District Judge James Knoll Gardner suggested a $3.5 million settlement, a figure that neither side liked. So the case went to trial in Allentown in late September.

Both sides aggressively presented their positions during the trial. Meanwhile, the relationship between lawyers on opposing sides became more and more strained from their daily courtroom battles. Together, they presented dozens of witnesses and hundreds of exhibits.

The first phase of the trial would be a liability phase to determine whether the police had violated the civil rights of Hirko, his fiancee, Kristin Fodi, and his landlord, Tuan Hoang. The second phase, if needed, would be to determine how much the defendants would pay for their wrongdoing.

During the first part, Karoly presented evidence indicating that officer Joseph Riedy had shot the suspected drug dealer with a submachine gun. Before shooting Hirko, Riedy tossed a flash-bang distraction device into Hirko's South Side home, accidentally setting the house on fire and badly burning Hirko's body.

Bethlehem's defense team maintained that the police had acted properly. Police claimed Hirko had fired a shot at them, even though there was no physical evidence to support that position.

On Feb. 20, the jury began deliberating.On March 4, the jury announced its decision: Police had used excessive force in shooting Hirko. In addition, the city had failed to properly supervise the officers on the raid and failed to create policies to govern the Emergency Response Team.

Minutes after the verdict, Gardner gathered the lawyers in his chambers, suggesting they consider settlement talks. He delayed the damages phase for two weeks, until March 17, to accommodate jurors' schedules.