Republished from MLIVE: http://www.mlive.com/news/flint/index.ssf/2015/09/appeals_court_tosses_1_million.html
FLINT, MI — The state Court of Appeals has tossed out a jury’s $1-million award for a former Genesee Intermediate School District employee who was fired from her position after she allegedly misused taxpayer money to fund an affair.
The court, in a ruling issued Friday, Sept. 25, overturned the jury verdict and ordered a new trial in the lawsuit brought against the GISD by former Assistant Superintendent Beverly Knox-Pipes.
Jurors awarded Knox-Pipes more than $1 million in May 2014 after the jury decided the GISD breached her contract and violated the state’s Whistleblower Protection Act when it fired her in 2011.
“We could not have asked for a better outcome,” GISD spokesman Jerry Johnson said of the decision.
The attorney who brought the lawsuit, Tom Pabst, called the ruling “outrageous and an abomination.”
Pabst claimed state law, which he said was established in a previous case he argued in front of the Supreme Court, supported the whistleblower claim.
“They’re just making up new law,” Pabst said of the appeals court.
The appeals court ruled that the Whistleblower claim, which accounted for much of the $1 million verdict, should have been dismissed before it went to trial and never decided on by jurors.
Knox-Pipes would have been entitled to $760,000 of the $1 million verdict due to the overlapping nature of the claims.
Pabst argued GISD Superintendent Lisa Hagel fired his client because she wanted Knox-Pipes out of the district to prevent her from testifying in a lawsuit filed by Clio schools over the GenNET program that Knox-Pipes headed.
Pabst relied on notes the GISD’s human resources director took during a meeting between Hagel and Knox-Pipes to argue that Hagel was displeased with his client’s participation in the GenNET lawsuit and that was why she was terminated.
Knox-Pipes never testified at deposition or trial in relation to the GenNET lawsuit.
However, the appeals court determined that Hagel was not displeased with Knox-Pipes’ participation in the GenNET lawsuit, but with the fact that Knox-Pipes gave former GISD Superintendent Tom Svitkovich, with whom Knox-Pipes had a romantic relationship, a district-paid cell phone and forwarded attorney-client information to him in the midst of the lawsuit.
District officials also claimed that an audit of Knox-Pipes’ travel expenses showed numerous discrepancies.
The ruling further stated there was no evidence that Hagel terminated Knox-Pipes because of her participation in the GenNET lawsuit.
“I always thought that the whistleblower case was not an appropriate case,” said GISD attorney Timothy Mullins.
Pabst claimed Hagel threatened to go public with the affair unless Knox-Pipes resigned from her position with the district and that she used the claims of embezzlement to smear Knox-Pipes’ name.
The appeals court’s decision, which ordered a new trial on the breach of contract claims, had strong words for Pabst, ruling that he repeatedly used inadmissible evidence and improper arguments while arguing the breach of contract claim.
The appeals court in its opinion said Pabst made improper statements by repeatedly telling the jury during closing arguments that prosecutors determined Knox-Pipes did not commit a crime and was wrongfully terminated, according to the ruling.
Before trial, prosecutors were provided evidence by the GISD that the district claimed proved Knox-Pipes was misusing taxpayers’ money. However, after review, prosecutors decided against filing criminal charges against Knox-Pipes.
The appeals court ruled Pabst’s statements to the jury were improper because a crime still could have been committed even though a prosecutor decides against filing charges.
“Because the prosecutor did not testify in this case, it was improper for counsel to argue that the prosecutor concluded that (Knox-Pipes) did not commit a crime,” the appeals court ruled.
The appeals court also determined Pabst inappropriately used an offer the GISD made to Knox-Pipes in an attempt to get her to resign to argue that the offer was proof the only reason the GISD had to fire Knox-Pipes was for misusing $480 dollars worth of district telephone equipment and that the other reasons for her termination were concocted.
Pabst said he plans to appeal the decision to the state Supreme Court.