SRC pays former administrator $725,000 to settle whistle-blower suit

The Philadelphia School Reform Commission has quietly settled one of four lawsuits stemming from a controversial $7.5 million no-bid camera contract backed by then-Superintendent Arlene C. Ackerman.

With no advance notice and no public discussion, the SRC unanimously agreed Thursday to pay $725,000 to Francis X. Dougherty, a former top administrator who lost his job in 2011 after he revealed the no-bid deal to the Inquirer.

Dougherty sued the district, and last year, a federal jury found that he had been wrongfully suspended and fired for disclosing the contract to provide surveillance cameras in troubled schools.

The agreement settles Dougherty's federal claims and covers part of his lost wages and legal bills.

The resolution approving the settlement was not among those posted online in advance of Thursday's meeting. District spokesman Fernando Gallard said it was added right before the session and was among documents available to the public at the meeting.

Gallard said Michael Davis, the district's general counsel, said the SRC aims to post resolutions two weeks before meetings so the public is aware of them. "Sometimes we don't meet that goal," Gallard said. "This is one of them."

He added, "With a settlement agreement, we want to move as quickly as possible."

Gallard declined to comment on the settlement, saying the two sides had agreed not to publicly discuss it.

Dougherty, through one of his lawyers, Alice W. Ballard, also declined to comment Friday.

In recommending the settlement to the board, lawyers for the district called it an "appropriate resolution" that would avoid continued litigation and additional legal fees.

The district has spent more than $960,000 in legal fees on the Dougherty case, records show. And it has paid nearly $1 million to lawyers it hired to defend three other lawsuits filed over its handling of the camera contract.

Most of the money - $1.4 million - went to the Tucker Law Group, a Center City firm that has defended the district and current and former officials in all four cases.

A year ago, a federal jury found that the district, Ackerman, and a former head of human relations had violated Dougherty's right to free speech by placing him on leave in December 2010 during an investigation into leaks about the camera contract, and then recommending that the SRC fire him.

A federal judge ruled that Dougherty was entitled to $318,520 in lost wages. His lawyers had been seeking $1.6 million for his legal expenses. The settlement is about 40 percent of that.

The district had appealed many of the judge's rulings during the trial and afterward, including how much Dougherty was entitled to be paid. As part of the settlement, the district agreed to drop the appeal.

The settlement calls for the cash-strapped district to pay Dougherty in three installments over three years. He is to receive an initial payment of $300,000 in 60 days and $210,000 by Aug. 31. He is set to receive a final check of $215,000 by Aug. 31, 2017.

Dougherty's suit was among four filed after the Inquirer reported on Nov. 28, 2010, that Ackerman had pushed aside a Bucks County firm that had begun preliminary work on an emergency contract to install surveillance cameras in 19 schools the state had deemed "persistently dangerous."

A district source told the newspaper that Ackerman ordered that the $7.5 million contract be given to IBS Communications Inc., a small, minority-owned firm then based in Mount Airy. The Bucks County firm was on a state-approved list of contractors eligible for emergency contracts. IBS was not.

Dougherty was one of six administrators placed on paid leave after the story was published, when the district began an inquiry into the leaking of the contract information.

The SRC later fired Dougherty, alleging he had violated policies that bar the disclosure of confidential information because he had forwarded district emails to a personal account.

In his suit, Dougherty disclosed that he was a source for the Inquirer article. He contended he was fired in retaliation for talking with reporters and contacting state and federal authorities to express concerns about the contract.

Ackerman left the district in August 2011 and died in February 2013. When the no-bid camera contract was made public, she repeatedly denied that she had directed her staff to award the work to IBS.

The three other lawsuits are pending.

martha.woodall@phillynews.com 215-854-2789 @marwooda