Rea to return $250K, hospital iPad in settlement

With eight words – and the stroke of a pen – Superior Court Judge William B. Carey dismissed the lawsuit against former Wrangell Medical Center CEO Noel Rea and six former members of the WMC Board of Directors that were recalled last year, along with a counterclaim brought by the defendants.

“The complaint and counter-claim are dismissed with prejudice,” Carey wrote in his April 29 order.

The lawsuit stemmed from the actions of the former board in their firing of Rea on June 20, during their last meeting as a quorum. The suit named Rea, along with recalled board members Mark Robinson, Sylvia Ettefagh, Linda Bjorge, Lurine McGee, Jim Nelson and LeAnn Rinehart and asked the court to direct the former hospital chief to return a severance payment. The case asked for a declaration that if Rea failed to return the payout, the recalled board members named in the suit would have been liable to the borough for a four-and-a-half year payout of $185,169.27 per year.

A severance check for $520,788.58 was processed and given to Rea on June 21.

In its initial filing, the Borough and WMC alleged that the members of the board named had conspired among themselves to fire Rea and provide him with a severance package before the Borough Assembly could certify their recall.

Rea then countersued the Borough, saying he had no advance knowledge of the board’s action in firing him and denying that a Release of Claims and Covenant Not to Sue were attached to his most recent employment contract. Rea and his attorney also claimed that no provision existed in the city code or charter requiring the Borough Assembly to review, approve, or even see WMC employment contracts.

In September, the Borough was able to amend their complaint against the seven defendants and sought the return of two pieces of technology that would become a sticking point – an iPad and laptop used by Rea in his duties at the hospital.

The entire case is over now, however, with a significantly different outcome than either the city, or Rea, had asked for.

Judge Carey’s decision codifies a settlement reached by the parties that calls for Rea to return the iPad, which was in his possession as of the date the agreement was signed, a return of $250,000 to the city, and the signing of another agreement to “not make any disparaging statements, whether oral or written to any persons of or about any other party, relating to any events that were at issue” during the case.

According to the settlement, “disparaging statements,” means oral or written communications that “lower a party in rank or reputation, speak slightingly about a party, denigrate, degrade, discredit or bad-mouth a party, with respect to any events that were at issue.”

The parties to the case, as well as Borough Manager Tim Rooney, Mayor Dave Jack, Assembly members, and borough officers as defined by the Wrangell Municipal Code, are prevented from using such statements for a period of five years from June 19, 2012. Members of the Wrangell Medical Center and Long Term Care Facility and its officers, as defined by hospital by-laws, and the WMC board members holding office at any time after June 26, 2012, are also covered by the five-year time period.

The iPad and laptop are also covered under a “protocol” agreement that will determine the fate of data on those pieces of technology.

In terms of the iPad, both Rea and the city will pay to have a forensic technology consultant, under the lead of a retired Alaska Superior Court judge, study the contents of its hard drive. Specifically excluded from any forensic examination would be items relating to attorney-client privilege, all personal Internet searches and history, personal letters, Rea’s divorce papers, his personal financial and medical information, and personal legal information.

After the forensic exam is complete, the consultant will be required to destroy the laptop and the iPad in such a way that data cannot be retrieved from either device, and shall confirm its demise in writing.

Rea will also be required to pay the City and Borough of Wrangell $2,500 as payment for the devices.

Attorneys for both the city and Rea were not available for comment by deadline for this story.