Arbitrator considers testimony, Rude letter at hearing

Published 7:25 am Wednesday, February 17, 2010

School board member Curt Rude’s opportunity to defend himself — as the board continues efforts to oust him — came and went Tuesday.

Rude did not attend a hearing yesterday, but rather submitted a letter in his defense, as an arbitrator considers whether the board has proper cause to remove him about one year and 10 months before his three-year term expires.

The hearing was held after the school board moved 6-1 last week to begin an unprecedented process to de-seat Rude, alleging, among other things, that his civil defamation lawsuit brought against the district creates a conflict of interest.

Under state law, four members of a board can vote to remove any member for “proper cause,” but this is rare. Rude would be the first board member in state history to be dismissed by fellow members and this particular situation is the first of its kind nationwide, according to independent arbitrator Richard Miller. Never before has a school board member sued their district while opting to remain in their seat, he said.

Superintendent David Krenz said the board tried to avoid the forced removal by sending a letter to Rude and his attorney about the conflict of interest, asking him to drop the suit or resign. No action was taken on their part, and the process of removing Rude began more than a month later.

Miller listened to the district’s case, and accepted Rude’s letter Tuesday morning. He will give a recommendation to the board prior to their next meeting, where they will cast their final vote on Rude.

Argument to oust Rude

District special counsel Margaret Skelton submitted 18 exhibits of evidence and called three witnesses during the formal hearing — to present the district’s case that Rude is not fulfilling obligations as a board member because of not only a conflict of interest but also his record of service.

Superintendent David Krenz, district director of finance and operations Mark Stotts and city parks and recreation director Kim Underwood were called to testify.

Krenz explained that the conflict of interest claim is based on Rude’s defamation lawsuit against former superintendent Candace Raskin and the school district. Rude’s suit, which seeks a minimum of $50,000 in damages, alleges the district is responsible for Raskin’s actions as she was their employee during the alleged acts of defamation.

Stotts’ testimony established that as a board member Rude could be asked to vote on his own settlement and any punitive damages would not be covered by district insurance.

Sitting on the board during these decisions, even if Rude abstained from voting, would be a conflict of interest because of an actual or perceived influence, Skelton argued.

In regard to his service on the board, Skelton said, “Curt Rude brought a suit against the district at the same time he is, by statute, obligated to defend it.”

Skelton referenced Minnesota Statute 123B.09 subdivision 19 which states, “In all proper cases, the board must prosecute and defend actions by or against the district.”

Also discussed in regard to Rude’s record was his attendance.

Rude attended 11 of 24 meetings in 2009 and his absence forced a replacement for a committee seat on the board of Austin Parks and Recreation.

Skelton also referenced the school board code of conduct that states that board members must always prioritize the well-being of students.

Stotts’ testimony on the financial implications of the suit suggested that Rude’s suit violates this section of the code of conduct.

The district’s insurance claims as a result of the lawsuit will have a negative effect on future premiums and bonds ratings, Stotts said. In addition, the board is financially dependent upon three operating levies which will soon be up for renewal. District testimony suggested that a black eye on the district, stemming from the negative publicity, could hinder requests for public funding.

In Skelton’s closing statement, she shared thoughts on the lawsuit itself.

“Rude has manufactured a lawsuit and is essentially suing himself,” she said, explaining that the board is responsible for the office of the superintendent.

“He is seeking money damages based on decisions he was involved in.”

Rude’s letter

Miller said Rude’s absence from the hearing is not uncommon and will not effect his decision.

Submitting a written defense is “sometimes more comfortable.”

Rude’s letter states that after researching news stories, consulting with the Minnesota School Board Association and his lawyer, he believes he can maintain his position as long as he excludes himself from meetings regarding the lawsuit.

In regards to his attendance, he wrote, “In the past, all attempts were made to forewarn and work with the superintendent and chairpersons regarding any absences…I was not made aware of any potential problems concerning my attendance prior.”

“I feel duty bound to work diligently and bring my thoughts and concerns to the school board,” he said in conclusion.

If Rude is ousted, the only option for the board will be to appoint a replacement to serve for the duration of his term, according to John Sylvester, deputy executive director of the Minnesota School Board Association.

Krenz, who joined the district in July, said after the hearing that he worries the entire saga might turn public opinion of the district.

“If that public trust is broken, and the public is not willing to do that [support the district via levies]… that would be detrimental.”

During his testimony, Stotts explained, “A case like this really doesn’t paint the district in a favorable light.”

The school board will meet Monday, March 8 in the city council chambers at 6:30 p.m.

The district and Raskin will seek a dismissal of Rude’s lawsuit at a motion hearing on March 10.