Why Fighting Lawsuit Against Dougco School Board Could Cost Taxpayers Plenty

The Douglas County Board of Education will hold its regular monthly meeting today, March 22, and its agenda includes this much-anticipated item: "Offer of Employment to a Sole Finalist for Douglas County School District RE-1 Superintendent of Schools."

The frontrunner is Erin Kane, a controversial former DCSD interim superintendent who was contacted by board president Mike Peterson to gauge her interest in the position days before her predecessor, Corey Wise, was sacked by the panel's four-member conservative majority: Peterson, Kaylee Winegar, Becky Myers and Christy Williams. If she gets the job as expected, Danny Winsor, the other finalist, should at least be given a good-sport prize.

Immediately after the announcement of the new superintendent, the board will also discuss whether to fight a lawsuit filed against the Peterson bloc by Douglas County resident Robert Marshall; his motion for a preliminary injunction was granted earlier this month. That ruling, by 18th Judicial District Judge Jeffrey Holmes, gave credence to claims that Peterson and company had violated Colorado Open Meetings Law by way of two-person meetings to coordinate Wise's firing.

A debate over the lawsuit dominated a March 11 special meeting, during which boardmember Elizabeth Hanson — who opposed the superintendent's dismissal along with colleagues Susan Meek and David Ray — said that spending taxpayer dollars on an appeal would be "absurd."

Her conclusion is backed by a document obtained by Marshall and shared with Westword, in which the insurance provider for the Douglas County School District states that it will not cover the costs of such a court challenge.

Why not? In a letter to boardmembers, Marshall notes that "a basis cited is that the complaint does not allege negligent violations of the law, but intentional ones by the four new boardmembers [Peterson, Winegar, Myers and Williams]. And the carrier's insurance policy only covers negligent, not intentional, misconduct."

A key passage in the document from the Colorado School Districts Self Insurance Pool underscores this assertion: "The Claims Are Not for 'Negligent' Conduct as Required Under Coverage B — School Leaders Wrongful Act. The definition of 'School Leaders Wrongful Act' in the policy requires 'negligent' conduct in order for coverage to apply. ... But the Complaint for the lawsuit does not include any allegations of negligent conduct. The words 'negligent' and 'negligence' do not appear anywhere in the Complaint. The policy does not provide School Leaders Wrongful Act coverage for the lawsuit."

Since the letter, written by litigation claims specialist Nancy Kanon, is dated February 18, its contents were available to the board well before the March 11 special meeting. As a result, Marshall's note asks the board: "Would it not have been proper at the last meeting to have informed the public not only that your insurance carrier had denied coverage, but the reasons why?" He then adds, "It would be appropriate to inform the public" about this fact during the March 22 meeting, "particularly as this board claimed to want to have transparency, but has been anything but transparent since November 30," when the new members officially joined.

Granted, the insurance denial may not be the final word on the subject. In the letter, Kanon points out that "the decision of CSDSIP to disclaim coverage to the District is based on the information we have at present. We reserve the right to reevaluate our coverage decision if new facts or pleadings are received." But as reported in the February 24 post "How Much Firing Superintendent Corey Wise Has Cost Dougco Schools So Far," the expenses are piling up. The terms of Wise's contract appear to obligate the DCSD to pay him $247,500 if he's dismissed "without cause" — a term used during the February 4 special meeting at which he was sacked. Since then, Wise has engaged two law firms to explore a possible wrongful-termination lawsuit.

The Dougco school board meeting gets underway at 5 p.m. at the DCSD Administration Building, 620 Wilcox Street in Castle Rock. In the meantime, Westword has reached out to the Douglas County School District for comment about the insurance company denial letter.

Click for more information and to read the insurance company denial letter related to Marshall v. Douglas County Board of Education, et al.