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W.Va. DHHR whistleblower lawsuit alleges pattern of failure

CHARLESTON, W.Va. - West Virginia's largest agency shows a pattern of failure when it comes time to award multimillion-dollar contracts, two lawyers for the Department of Health and Human Resources said in lawsuits filed Tuesday.

In two separate whistleblower suits, the lawyers - Susan Perry, DHHR's deputy secretary for legal affairs, and Jennifer Taylor, its general counsel - blast the agency for a "track record of errors" Perry and Taylor had to correct or tried to keep the agency from making.

DHHR Acting Secretary Rocco Fucillo, in turn, put Perry and Taylor on paid leave in mid-July. A third official, assistant secretary John Law, who handled public relations for DHHR, is also on leave.

The three apparently were "reassigned" after they raised questions about a multimillion-dollar marketing contract DHHR has since awarded to the highest bidder.

Now, 12 weeks since being placed on leave, Perry and Taylor said they are whistleblowers who are being punished for trying to prevent wrongdoing or waste.

The marketing contract, estimated to be worth $3.5 million, was awarded to Fahlgren Mortine for one year's work. To pick Ohio-based Fahlgren, DHHR passed over three lower bidders.

A three-member evaluation committee, led by Law's deputy, Marsha Dadisman, reviewed the bids and decided the contract should go to Fahlgren.

The committee's room for error was small: Of 100 possible points, Fahlgren received 93.96 in the scoring process. The Arnold Agency, which was DHHR's former advertising firm, received 93 points and was the lowest bidder.

After reviewing the scoring, Taylor found the decision "legally indefensible," according to the suits.

In mid-September, DHHR's Office of the Inspector General had an unusually lengthy search warrant issued for the offices of the three on leave. The warrant was ostensibly to search for evidence that Law, Perry and Taylor may have illegally interfered with the multimillion-dollar marketing contract.

But Walt Auvil, the Parkersburg lawyer who filed the lawsuits in Kanawha Circuit Court, said the document read more like a press release than a search warrant. It was also unclear why the department waited nearly two months to formally seek information from within its own offices.

Perry and Taylor's suits on Tuesday describe a far different scenario from the search warrant. The warrant alleged the group tried to "favor" Charleston-based Arnold Agency.

But, according to the whistleblower suits, Dadisman, the head of the evaluation committee, was worried about the contract going to Fahlgren. She told Law that the evaluation committee expected a protest of its decision, according to the suits.

Law is said to have become worried about more legal troubles for DHHR.

"These concerns were heightened by a recent pattern of (the DHHR purchasing office's) failure to properly handle bids, contracts and other matters," the suits allege.

Taylor and Perry "had previously corrected the mistakes of Warren Keefer, Bryan Rosen and others in the (DHHR purchasing office)."

Rosen is the head of DHHR's purchasing office. Keefer is a DHHR deputy secretary and also Rosen's boss.

DHHR - specifically Rosen's office - has had recent trouble with some bids. One $200 million computer contract has been rebid twice, once because of unrevealed problems and a second time because the procedure was tainted by a conflict of interest.

According to the suits, Keefer and Rosen "so mishandled" those first two bids that Taylor and Perry had to spend hours responding to requests from the Legislative Auditor's Office and fixing a third bid request document so that problems didn't occur yet again.

When it came to the marketing contract, the lawyers were so concerned about the scoring, they warned other DHHR officials they could not go to court to defend the contract if it was awarded to Fahlgren and challenged by one of the other bidders.

Clashing views

In the suits, Perry and Taylor name Fucillo, Keefer and Rosen and accuse the three of violating the state's laws meant to protect whistleblowers, lawyers and women. Perry and Taylor also accuse Fucillo, Keefer and Rosen of casting them in a false light.

Auvil said Perry and Taylor's job was to protect DHHR and the public.

"And they tried to do that and the result is both of them have been put out - that's not OK," Auvil said in a telephone interview Tuesday.

Taylor's review of the marketing contract's scoring found "obvious deficiencies."

Taylor found Dadisman's three-member committee had awarded the contract based on a review that was "inconsistent, arbitrary and deficient and . . . legally indefensible," the suit says.

Taylor warned that the contract award was a "poster child for arbitrary and capricious."

But the warnings were unheeded.

According to the whistleblower suits, Rosen looked at Taylor's analysis in May "and reluctantly agreed that several points . . . were correct." But Rosen said the contract was already awarded so nothing could be done.

But the contract was not formally awarded until about two months later. By DHHR's own account, the marketing contract was not awarded until July 19.

DHHR did not comment specifically on the allegations from Perry and Taylor.

Will Jones, an assistant attorney general who has been assigned to work at DHHR, said he could not comment on the suits because they are pending legal matters.

Asked if he had to deal with errors or failures within DHHR's purchasing office, Jones said, "Since I've been over here, no I haven't."

Tomblin staff alerted

The issue came to the attention of Gov. Earl Ray Tomblin's senior staff.

In early July, deputy chief of staff Erica Mani wanted to know more about the contract.

On Tuesday, July 10, Taylor told Mani she was worried about the scoring process, according to the suits.

Mani told Taylor that the Governor's Office had concerns if DHHR's lawyers did.

But then those concerns evaporated. In a later conversation that evening, Mani told Taylor the Governor's Office did not want to get involved. Mani canceled their plan to meet the next day. 

According to the suits, Mani said she had talked to David Tincher, the head of the state's Division of Purchasing. Tincher said the division assumed the award was OK, but he would be glad to meet with Taylor.

During the same conversations, Mani told Taylor that the existing marketing contract with The Arnold Agency would be extended.

This appears to contradict a key part of DHHR's search warrant, which accuses Law, Taylor and Perry of unlawfully interfering with the process and causing The Arnold Agency to get a 30-day contract extension this summer.

After Mani canceled the meeting, Taylor and Perry turned to Fucillo.

But during this key moment in the chain of events, Fucillo was absent or uninterested, according to the suits.

On Wednesday, July 11, Fucillo was not in the Charleston office, according to the suits.

Perry and Taylor tried to talk with Fucillo on Thursday, July 12. But Fucillo said he would discuss the contract with them the next morning during a scheduled conference call.

Fucillo called in from Fairmont on Friday, July 13. The Tomblin administration apparently assented to Fucillo's flexible schedule, which formerly allowed him to work part of the time from near his home in Clarksburg and be compensated for commuting to Charleston. That arrangement has since ended.

At any rate, during the July 13 call, Fucillo never asked Perry or Taylor about their concerns with the contract, according to the suits. Instead, Fucillo said they would talk further on July 16, a Monday.

Working from home

On July 16, Taylor and Perry were placed on administrative leave, barred from their offices and escorted out of a DHHR building in downtown Charleston. Since then, they haven't been allowed to check their work emails, and their work cellphone and laptops have been confiscated, the suits say.

And yet they are assigned work to do from home or are to remain "on call" eight hours a day.

Law is also on leave from the agency, but he did not file a whistleblower suit.

Tomblin told the Daily Mail editorial board last week that the three on leave were working from home. He has urged an expeditious resolution to the situation, but it is unclear what he or his office has done to resolve the situation.

Republican challenger Bill Maloney's campaign quickly released a statement Tuesday calling for Democrat Tomblin to show some leadership.

"It's unfortunate that Earl Ray Tomblin managed our state so poorly that our own state employees must resort to legal action when they perceive corruption or improper behavior by Tomblin's team," Maloney said.

Contact writer Ry Rivard at ry.rivard@dailymail.com or 304-348-1796. Follow himm at www.twitter.com/ryrivard.

 


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