Assembly Panel Moves on Houghtaling and Downey Bill Barring Public Agencies from Settling Whistleblower Suits Confidentially

An Assembly panel approved legislation sponsored by Assembly Members Eric Houghtaling and Joann Downey that would bar public entities from entering into confidential settlements of whistleblower lawsuits with public employees and mandate that such settlements are part of open public records.

The bill was first introduced last session in response to the settlement reached with former Hunterdon County Assistant Prosecutor Bennett Barlyn, who testified extensively on the bill during a hearing this week before the Judiciary Committee.  Barlyn filed a lawsuit against the state in 2012 alleging he had been fired in 2010 after complaining to a superior that an indictment brought by the Hunterdon County Prosecutor’s Office had been dismissed by then Attorney General Paula Dow for political reasons. 

In October 2016, it was reported that the lawsuit was settled for $1.3 million in August and that the state spent almost $4 million on additional legal fees. Under terms of the settlement, the state denied any wrongdoing or liability in the matter.

Specifically, the bill (A-1229) would bar public entities and public employees from entering into any agreement to settle a claim or action when the public employee asserts the protections of the “Conscientious Employee Protection Act,” informally known as the “Whistleblower Statute,” if the agreement:

1)    provides that the terms or conditions of the settlement are confidential; or

2)    if the purpose or effect of the agreement is to conceal information relating to any claim or action against a public entity concerning the public interest.  The bill would provide for an exception for matters involving national security. 

In addition, the bill would require the Attorney General to make publicly available on their website a list of all settlements entered into by the state which would include, for each settlement agreement listed:

  • The date on which the parties entered into the settlement agreement;
  • The names of the parties that settled claims under the settlement agreement;
  • A description of the claims each party settled under the settlement agreement;
  • The amount each party settling a claim under the settlement agreement is obligated to pay under the settlement agreement; and
  • The amount of outside counsel fees, if any, paid by the State in connection with the claim.

“It’s unacceptable that the state would readily waste over a million dollars in taxpayer money, then seal the terms of the settlement to avoid answering to allegations of corruption,” said Houghtaling.  “This bill will put an end to that.”

“It’s unfortunate that taxpayers have to foot the bill for this alleged misconduct, but they have the right to know that this reckless abuse of their money will not be tolerated again,” said Downey.  “This bill effectively says:  no more.”

Finally, the bill would provide that such settlement agreements constitute public records under the open public records laws.

The measure was approved by the Assembly State and Local Committee; it will now be considered for a vote by the full Assembly.

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