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Thursday, April 23, 2009 | An employee at the San Diego County Office of Education advises her boss on whether to retain attorneys for personnel cases, a decision that routinely leads to her husband’s law firm receiving business from the agency.
Michele Fort-Merrill, who oversees the agency’s human resources department, is married to William Merrill, a partner in Best, Best & Krieger, a San Diego law firm that frequently represents the county office. She has a financial interest in the firm of more than $100,000 annually through his income, according to state forms that disclose her economic interests.
When an employee is disciplined or other problems erupt with employees in the office, Fort-Merrill weighs whether or not an outside attorney is needed to help navigate legal issues, or whether human resources staff can handle the problem, County Superintendent Randolph Ward said in a recent interview. If she believes that lawyers are needed, she makes a recommendation to Ward, who then makes the ultimate decision on whether to hire an attorney.
Neither Ward nor Fort-Merrill specifies which attorney to use, Ward said. But BB&K is routinely used for personnel cases unless its attorneys lack expertise in a specific topic, Ward said. The county office does not have a written policy outlining the process by which attorneys are hired.
“It’s been decided by history that Best, Best & Krieger would be used for disciplinary matters,” Ward said. He added, “What typically happens is we would ask BB&K whether they have the expertise on a certain issue, and if we didn’t feel they did, we would go to a different counsel.”
The phenomenon is one in a spate of complaints raised in a recent lawsuit by a former employee, Rodger Hartnett, who alleges he was fired for blowing the whistle on “a culture of corruption” that resulted in government business going to friends and spouses of San Diego County Office of Education employees.
While Fort-Merrill does not directly assign legal work to any specific firm, her advice helps determine whether the office turns to outsiders or its own staff to handle difficult issues — and going to outsiders frequently means going to her husband’s firm.
University of San Diego public interest law professor Robert Fellmeth said that the practice would only be acceptable if Fort-Merrill had a much more limited role that involved no independent judgment in deciding when an attorney is needed, such as signing a form to formally request that the agency hire an attorney after an employee filed a lawsuit against them. He cautioned that his opinion relied on the facts supplied by a reporter.
“If she is making decisions to invoke contracts with counsel and she knows that the firm generally hired includes her husband — there is a problem,” Fellmeth wrote in an e-mail. “She influences the volume of business going to law firms — a substantial part of which inures to her husband’s firm.”
BB&K received nearly $688,000 in business from the office between July 2005 and July 2008 while Fort-Merrill oversaw human resources, according to documents Hartnett provided to voiceofsandiego.org. Fort-Merrill’s husband has decades of experience as an employment and labor law attorney, according to the BB&K website, which lists him as one of only two attorneys in the firm who specializes in school labor relations law.
Ward said that there is no conflict posed by Fort-Merrill making the recommendation because he makes the final decision on whether or not to hire attorneys. He called BB&K “a staple counsel” and said that William Merrill, commonly known as Woody, had been hired by the agency long before both Ward and Fort-Merrill were employed there. He declined to comment on whether Fort-Merrill had ever recused herself from recommending whether to hire attorneys, saying it was too related to the ongoing court case.
“She is not involved in the decision to retain her husband’s firm. I am the one that does that,” Ward said. He added, “I’ve authorized the attorney. I authorize the company. There is no conflict with me.”
But Fellmeth said that explanation falls short. “The ‘approval’ or ‘review’ by another official does not resolve the problem,” he wrote in an e-mail.
Public officials are generally barred from making or helping to make government decisions in which they have a financial interest under California law. Being involved in the decision can include advising the decision maker. Roman Porter, executive director of the Fair Political Practices Commission, said that hiring, firing, promoting or demoting a spouse typically falls under those rules, and officials are generally supposed to recuse themselves from government decisions that could impact their finances, though the rules are complex and subject to interpretation.
Robert Stern, president of Center for Governmental Studies and former Fair Political Practices Commission general counsel, said he was unsure whether the practice posed a legal problem. He wanted to know how often the firm was chosen and how often William Merrill was the chosen attorney.
The San Diego County Office of Education was unable to provide documents last week showing how much was spent on the firm before Fort-Merrill got her position, how often it is retained compared to other forms, or how often her husband is the specific attorney retained.
If the firm were one of 100 that could be selected, Stern said he would be less troubled than if the firm almost always gets the work, as Ward suggested. Even if it is not a legal problem, Stern was uncomfortable with “the appearance” of the practice.
“It just seems like that’s not the way it should be,” Stern said. “She can’t be making the recommendation to hire an attorney if she knows it’s going to be her husband.” He added in an e-mail, “If it is always or nearly always her husband’s firm, I think she should not be participating even if the law allows her to do so.”
William Merrill and Michele Fort-Merrill both declined to comment; Fort-Merrill referred questions to County Office of Education attorney Steven Cologne.
The San Diego County Office of Education helps support school districts by providing financial oversight, training and networking for educators, and technical assistance with new technology, among other functions. It also runs alternative schools for students in foster care and juvenile hall and for pregnant or parenting teenagers.
And it operates two joint powers authorities — organizations formed when school districts or other government agencies pool their powers to handle a common function. One handles legal claims brought against school districts; another buys benefits for school employees at a lower rate than the school districts could finagle on their own.
Both groups have faced recent allegations of conflicts of interest. The San Diego Union-Tribune recently reported that an employee who manages a retirement program for teachers and administrators boosted his salary by selling outside investments to the same clients.
The other is the focus of the ongoing lawsuit by Hartnett, the former employee who claims he “discovered and reported a culture of corruption within my department involving conflicts of interest and interpersonal relationships” that led to legal business being sent to friends and spouses of employees. He alleges that Fort-Merrill orchestrated his firing “because I had further discovered, exposed and reported what I reasonably believed to be conflicts of interest in her husband acting as general counsel.”
Hartnett also claims he was fired for complaining about how business was rotated within a Joint Powers Authority operated through the County Office of Education that handles legal claims for school districts.
His suit highlighted the fact that two attorneys from one law firm, Stutz, Artiano, Shinoff & Holtz, have helped interview workers who would later oversee their billing. He also questioned whether it is appropriate for an employee to retain Stutz Artiano for his personal use.
A judge ruled last month that Hartnett should be given back his job and pay because the Office of Education’s Personnel Commission failed to investigate his claims. The judge did not rule on whether those claims were justified, but said that the termination was invalid because the Office of Education did not follow the proper steps beforehand.
The Office of Education is appealing the ruling. It maintains that Hartnett was fired for negligence, insubordination and dishonesty, including discussing a confidential file with an outside attorney and lying about it.
The question of whether Fort-Merrill was involved in retaining attorneys, including the firm that employs her husband, came up during his hearing with the Personnel Commission, an internal body that weighs disciplinary issues.
Attorney Barry Vrevich, who represented Hartnett, questioned Ward about who recommended hiring an attorney for the County Office of Education for another hearing; Ward said that it was the human resources department and, when asked, clarified that it was “through Michele.”
“Do you consider there to be anything improper about sending business to — the County Office business to spouses of employees?” Vrevich asked.
“I had that sole authority to approve any assignment of counsel,” Ward replied.
Fort-Merrill was first hired by the county office in 1976 as a personnel analyst and resigned after several promotions in 1987. She returned to the agency nearly 14 years later as a human resources specialist and was tapped for her current post in 2005.
Please contact Emily Alpert directly at emily.alpert@voiceofsandiego.org with your thoughts, ideas, personal stories or tips. Or set the tone of the debate with a letter to the editor.