So, how is the civil case between DCSS and Heery Mitchell coming along?

We’ve been having a discussion on an unrelated thread about the civil case between DCSS and Heery Mitchell so I thought I’d try to do a little research and bring us up to date on what is known. This is very complicated now that Crawford Lewis, Patricia Reid (Pope), Vincent (Tony) Pope and Cointa Moody have been indicted on RICO charges.

A recent article in the Daily Report, a very expensive law rag, has cleared the air on some of the facts of these cases. I will simply bullet-point what I learned. I can’t reprint or offer a link, as this is a corporate magazine and available only by subscription. Lawyers who subscribe can read it in the June 17, 2010 issue. The article is entitled “School case has a civil side”.

Key points are below:

• Heery Mitchell International and E.R. Mitchell Co. originally sued the DeKalb school district for $1.5 million for breach of contract.
• The DeKalb county school system countersued for more than $100 million.
• The countersuit accuses Heery/Mitchell, etc of civil racketeering violations, including submitting fraudulent invoices, running projects repeatedly over budget and mismanaging the school construction program.
• In March, after superintendent of schools Crawford Lewis and COO, head of construction for DCSS, Pat Reid (FKA: Pope) were publicly accused of criminal activity regarding construction contracts, Heery/Mitchell added to their claim, accusing Lewis and Reid of dumping them as construction managers in order to steer business to favored vendors.
• The criminal indictments have already delayed the lawsuit, which was supposed to go to trial in June.
• The criminal charges also put our county government in conflicting positions – with school officials defending their contracts and bidding process in the HM civil suit, while county prosecutors build a case against former school system leaders claiming bribery and other charges.
• King & Spalding is representing the school system in the civil case and claim that the criminal charges have nothing to do with their civil suit. They also say that Heery Mitchell is using the criminal lawsuit to deflect attention from their own poor job of managing $1 billion of construction.
• Heery Mitchell’s attorney, Mark Grantham of DLA Piper stated that the criminal charges show that Heery Mitchell’s termination may have actually been due to the school administrator’s scheme to engage in criminal conduct.
• The Heery International v DeKalb County School District case has 1,053 docket entries that include depositions sought or taken of Lewis, Reid, Pope and Moody. The sealed deposition of Reid, is 7 inches thick.
• Included in the indictment is an attempt by Lewis to stall the criminal probe because he feared the criminal probe investigation might damage the school system's defense in the Heery/Mitchell suit.
• The HM contract was terminated in February 2007.
• "Heery was able to—and did—take advantage of its superior knowledge and experience in construction-related matters to mislead employees of the School District ... concerning the effectiveness of Heery/Mitchell's management of the program," wrote John W. Hinchey, another King & Spalding attorney on the school system's defense team.
• Some of the projects Heery/Mitchell were accused of mismanaging are now part of the criminal case against Lewis, Reid, Pope and Moody. They include the McNair Cluster Elementary School, the Mountain Industrial Center and the Miller Grove projects.
• The indictment and pleadings by Heery/Mitchell show that Reid's hiring coincided with an overhaul of vendors involved in the school system's construction program.
• In 2006, Lewis asked the school board to vote to replace an auditor that had given Heery/Mitchell a glowing report the previous year, telling the board the move was "an emergency," according to the plaintiffs.
• MGT of America in a May 2005 audit reported that "an overall on-time and within budget completion in the face of a nearly 20 percent funding shortfall is evidence of the professionalism and experience of the Heery/Mitchell Joint Venture."..."The [school system] is to be commended for hiring a competent agency representative," MGT concluded.
• Lewis wanted Rubino & McGeehin of Bethesda, Md., to become the new auditor, and its 2006 report was highly critical of Heery/Mitchell, although it did not accuse the companies of fraud. (The state also issued a report on an audit available at this link.)
• On April 19, 2006, according to Heery/Mitchell, Pat Reid informed the construction partners their contract had been suspended until further notice. She also ordered the contractors off school property by the end of the work day.
• The following day, according to the indictment, C.D. Moody Construction Co. was awarded the $11.9 million contract for McNair Cluster Elementary. The company's owner, Charles David Moody, was a close family friend of Reid and Pope, according to the indictment.
• C.D. Moody listed Vernell Barnes as the project's "architect of record.” But prosecutors say it was Vincent Pope (Reid’s then husband), not Barnes, who did most of the substitute architectural work. Pope tried to cover his involvement in the project in an email that is part of the evidence.
• In all, Pope was paid $2.4 million for which he was not entitled, prosecutors allege. That includes $445,000 for work Pope never did for the Columbia project.
• Reid, Lewis and Moody are also accused of theft and soliciting bribes in the form of tens of thousands of dollars in tickets to major sporting events.
• Lewis' indictment also includes a count of obstruction of justice when he asked the assistant DA to “table” the criminal investigation out of fear that it would harm the civil case

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The civil case Heery International v. DeKalb County School District, is No. 07CV2532 and is before DeKalb Superior Court Judge Clarence F. Seeliger.

UPDATES:

Additional stories on the subject are available at these links:

DA: 'Bad faith' in schools case

K&S will remain on schools case: More on the story

Are we gearing up for a trial yet?