COMMENTARY: City Attorney Don Freeman’s Culpability in the Culture of Harassment, Discrimination and Retaliation

At the 3 August 2010 City Council meeting, City Attorney Don Freeman presented himself as a city attorney who honors the rule of law, at least with regard to city employee confidentiality laws. However, his record as city attorney since 2003 shows the City Attorney knew about city employees’ claims of “hostile” workplace environment and forced “early retirement.” Moreover, in the Jane Miller case, the City Attorney’s “failures,” errors and omissions, and “silences” have arguably contributed significantly to the continuance of a culture of harassment, discrimination and retaliation in the city government of Carmel-by-the-Sea.

EVIDENCE:

• In 2003, the City Attorney was aware of negotiations between City Administrator Rich Guillen and attorney Michael Stamp involving Stamp’s representation of Assistant City Administrator Greg D’Ambrosio and Community and Cultural Director Brian Donoghue; both made serious employment discrimination claims against the City and City Administrator, including claims of "hostile work environment" and "forced early retirement." In fact, with regard to the Assistant City Administrator, City Attorney Freeman specifically authorized Stamp to meet directly with the City Administrator to try to negotiate the claims. With regard to the Community and Cultural Director, in 2003, Donoghue advised the City Attorney that he was concerned about retaliation relating to his role in reporting certain issues.

• In 2006, the City Attorney was advised by the City Administrator regarding negotiations between Stamp and the City Administrator involving serious employment discrimination claims against the City and the City Administrator by Library Director Margaret Pelikan, including allegations of "hostile work environment, forced retirement and the City Administrator’s favoritism towards Christie Miller." The City Attorney approved and signed off for the City on the settlement agreement.

• In 2008, the City Attorney was involved with the negotiations regarding Executive Assistant Sandy Farrell’s discrimination claims against the City and the City Administrator, including claims of "hostile work environment and forced retirement." The City Attorney approved the settlement agreement.

Note: The four cases from 2003 to 2009 resulted in the City paying negotiation payments of more than $500,000 to the four employees, which the City considered to be “significant.”

• In May 2008, attorney Michael Stamp, in his representation of Human Resources Manager Jane Miller, wrote a May 20 letter to the Mayor and City Council, with a copy to the City Attorney, raising Miller’s claims of "sex-based discrimination, age-based discrimination, sexual harassment and retaliation against the City and the City Administrator." The City Attorney recognized Stamp’s role as Miller’s litigation counsel if the case did not settle.

• In May 2008, the City Attorney’s Office wrote a May 22 letter to Jane Miller’s attorney Michael Stamp that City Attorney Don Freeman would “prepare a response” to Stamp’s May 20, 2008 letter when he returned from a trip on June 2, 2008. The City Attorney never responded in writing to the May 20, 2008 letter. He later communicated to attorney Michael Stamp by telephone that he was letting Liebert Cassidy speak for him, and that he had ordered Liebert Cassidy Whitmore to assign a senior attorney to the matter.

• In September/October 2008, the City Attorney reviewed an Employee Agreement between the City and City Administrator Rich Guillen approving a retroactive compensation increase of $14,500, which was unanimously approved by the Mayor and City Council at the October 7, 2008 City Council meeting.

• In October 2008, Stamp provided the City Attorney with a letter summarizing the problems with the City’s lack of action since May 20, 2008. The City failed to respond.

• In late October 2008, Stamp provided the City Attorney with an original letter and five copies of a 13 page statement by Jane Miller. The City failed to respond.

• In November 2008, Stamp had a telephone conversation with the City Attorney concerning City Council discussions in regard to Jane Miller, particularly about the City Attorney’s question as to whether Miller had copies of emails to support her allegations. “The City Attorney made a statement about the Mayor and the City Administrator’s conduct, which highlighted the seriousness and significance of Miller’s claims.” Stamp explained to the City Attorney that Miller had received more than one hundred non-work-related emails - not including instant messages and telephone calls – from the City Administrator over several years.

• August 7, 2008 – January 16, 2009: “Investigation” by private investigator/attorney Karen Kramer; Kramer interviewed twelve witnesses, eleven current employees and one former employee, including “a majority of the witnesses Ms. Miller identified in her written complaints.” However, Kramer did not interview Employee #1 (Assistant City Administrator Greg D’Ambrosio), Employee #2 (Community and Cultural Director Brian Donoghue), Employee #3 (Library Director Margaret Pelikan) and Employee #4 (Executive Assistant Sandy Farrell).

• February 9, 2009: Letter, Re: Notice of Completion of Investigation – Jane Miller’s Workplace Complaints, from Liebert Cassidy Whitmore (LCW) to attorney Michael Stamp stating “Based on Ms. Kramer’s findings and conclusions the City has determined that Ms. Miller’s allegations are not substantiated. Accordingly, this investigation is now closed and deemed completed.”

• In September 2009, LCW, presumably with the authorization of the City Attorney, filed a motion by Defendant City of Carmel-by-the-Sea to disqualify plaintiff’s counsel. Incredibly, the City had Assistant City Administrator/City Clerk Heidi Burch make a declaration which “provided the primary evidentiary basis for the City’s motion to disqualify attorney Michael Stamp” from representing his client, Jane Miller. Burch's declaration was characterized as “insubstantial and inadmissible.” In fact, the Burch declaration was characterized as an “interested person’s unqualified conclusions.” Moreover, Burch was not only unqualified to make conclusions about documents, she was not associated with the City when attorney Michael Stamp performed work for the City and she herself was directly implicated in the lawsuit as “Female B.”

•In the Court’s denial of Defendant City of Carmel-by-the-Sea’s Motion to Disqualify Plaintiff’s Counsel, Judge Larry E. Hayes wrote on February 3, 2010, as follows:

The City had actual knowledge of any claim of a potential conflict beginning in 2003 when Mr. Stamp represented the first senior City employee in his employment claims against the City. Between 2003 and 2008, Mr. Stamp represented an additional three senior City employees in their employment claims against the City.

The City failed to prove that the City performed a reasonable investigation into the potential merits of the disqualification motion by interviewing the key City personnel, including the City Attorney. The Court finds disingenuous the City’s assertion that the actual knowledge of material facts by the City Attorney need not be inquired into by the City’s lawyers or disclosed by the City in regard to this motion. The Court finds that City Administrator Richard Guillen and City Attorney Don Freeman knew about the former representations during the pertinent time period. The weight of the evidence shows that those individuals would have had specific knowledge about those former representations...

• The City Attorney announced a settlement in the Jane Miller case after a Closed Session on July 13, 2010: “This settlement means all parties avoid the further burden and expense of litigation and the uncertainty of a jury trial. By resolving this matter and avoiding months of litigation and expenses, we can look forward to redirecting more energy and resources to the many challenges facing the city in these uncertain economic times.” The City Council's unanimous approval of the $600,000 settlement, paid by the City's insurance agency, California State Association of Counties (CSAC) Excess Insurance Authority (EIA), was approved at the recommendation of EIA.

• At the August 2010 City Council meeting, City Attorney Don Freeman emphasized that the “investigation” was not conducted by the city, but rather by the city’s original law firm, LCW. Yet, the City embraced the findings and conclusions of the “investigation” when the City Attorney knew, or should have known, that the “investigation” was not a thorough and complete investigation.

CONCLUSION
The weight of the evidence suggests that the City Attorney’s “failures,” errors and omissions, and “silences” had the net effect of protecting and shielding from public accountability the city administrator, mayor and city council members at the expense of city employees, citizens and the city’s reputation. Moreover, the City Attorney not only committed “failures,” errors and omissions, and “silences,” but he reviewed and approved a retroactive $14,500 compensation increase for the City Administrator within five months of receipt of attorney Michael Stamp’s May 20, 2008 letter outlining Jane Miller’s complaints and during a yet to be concluded “investigation” into Jane Miller’s claims. The Mayor and City Council later unanimously approved the Employment Agreement between the City and City Administrator Rich Guillen at the 7 October 2010 City Council meeting.

While the City’s Code of Ethics states “Our actions are deemed representative of those we serve and our function, therefore, carries with it a greater responsibility than that of the private enterprise employee,” the Mayor and City Council have had most recently over two years, since May 2008, to take appropriate action and have failed to date to take appropriate action whereas in the private section recently, the Board of Hewlett-Packard acted swiftly and decisively (within one month) by conducting an investigation which concluded that the CEO had violated the company’s ethics code thus precipitating CEO Mark Hurd’s resignation. As HP General Counsel Michael Holston stated, Hurd “demonstrated a profound lack of judgment that seriously undermined his credibility and damaged his effectiveness in leading HP.” “The board took immediate action in this matter and their decision was right and necessary to uphold HP’s values of trust, respect and uncompromising integrity.”

Moreover, as Charles Elson, director of the corporate governance centre at the University of Delaware stated: “Once trust is broken between a CEO and a board, it makes it harder to have confidence in anything he says in future. He had to go.” Similarly, in the City of Carmel-by-the-Sea, trust has been irreparably broken between the City Administrator and the denizens of Carmel-by-the-Sea. Ergo, the City Administrator has to go!