Former WMC board replies to suit

The attorney for six of the recalled Wrangell Medical Center Board of Directors has given a response to a lawsuit filed against them and former CEO Noel Rea by the City and Borough of Wrangell.

The answer was filed in First District Court on Aug. 10.

The borough, through their attorney, Bob Blasco, filed suit on July 11 seeking to have an amendment to the employment contract of Rea voided, and to order that he return a six-figure severance check paid to him after his termination by the board on June 20.

That severance check, in the amount of $520,788.58, was paid to Rea via a wire transfer on June 21 – one day after the board voted 6-1 to fire him without cause.

In the response to the allegations leveled by the city, attorney Jon Dawson of Anchorage states that his clients: Mark Robinson, Sylvia Ettefagh, Linda Bjorge, Lurine McGee, Jim Nelson and LeAnn Rinehart, acted in good faith while dealing with Rea’s firing, and that their actions formed a “legitimate business purpose,” which was thus a privileged act.

The reply by Dawson refutes some of the most serious charges, including the assertion by the borough that paying Rea upon his firing constituted an “illegal private gift of public funds,” and denying outright that former board president ordered interim CEO Olinda White to write a check to Rea, or that she wouldn’t be allowed to leave the building until she did so.

The filing by Dawson does admit, however, that a second amendment to Rea’s contract was drafted and paid for without the approval of Borough Manager Tim Rooney – and that a public notice as to Rea’s employment was not provided to the public prior to their June 20 meeting.

“Insofar as paragraph 123 alleges that public notice was not provided in advance of the regularly scheduled Board meeting on June 20, 2012 that potential action may be taken as to Rea’s employment at such meeting, such allegation is admitted,” the filing states.

Concluding the filing, Dawson asked the court to dismiss the case with prejudice – a move that would bar the city from pursuing it further in court, and that the city be held liable for attorneys’ fees incurred since its filing.

According to the Alaska CourtView system, Rea has not yet retained an attorney in the matter.