SEATTLE — Arbitrators have awarded $350,000 to former Lake Chelan Community Hospital CEO David Bernier, finding that the hospital defamed him.
The final arbitration ruling by the panel in Seattle ends a legal battle over the hospital’s decision to fire Bernier less than two years after he was hired.
A strongly-worded termination letter in September 2009 said the hospital board fired him due to “dishonesty, possible fraud, and other actions.” Reasons given included using hospital funds to pay for a golf tournament, meals and a room for his partner, and using his partner as a personal reference to get the job.
Bernier claimed at the time that he was fired because he is gay, and called the board’s action a hate crime. He denied any dishonesty, and said he had been harassed by certain hospital employees who went to the board with unfounded complaints.
The Nov. 28 arbitration ruling itself gives no details about how Bernier was defamed.
His Seattle lawyer Leslie Hagin wrote in a letter to The Wenatchee World that the false statements about Bernier included his reprimand for sexual harassment of a hospital employee, and his termination for financial issues and “other claims.”
“In fact, the Hospital’s own investigator found he had not engaged in sexual harassment,” and a state audit found no fraud or misappropriations, she wrote.
The letter included a copy of the arbitration panel’s Nov. 28 final ruling. One of three panel members disagreed with the decision. Hagin did not return a call on Thursday.
Other claims by Bernier — including breach of contract, wrongful withholding of wages, discrimination, and violation of due process — were dismissed in the arbitration ruling.
The panel also found that Bernier owes the hospital $8,666 for a housing allowance, moving expenses, unpaid credit card charges, un-allowed reimbursements and personal expense charges, as well as investigation costs.
Those appear to be the same financial issues cited by the hospital when it terminated Bernier in September 2009, and in a state audit report.
Just before firing him, hospital commissioners asked the state for a special audit, which, when completed in 2010, challenged the payment of more than $22,000 to Bernier.
Auditors recommended that the hospital attempt to recover those funds, along with almost $4,000 in investigation costs, from either Bernier or its insurance company.
The arbitration ruling does not specify which of those costs Bernier must repay.
Arbitrators determined that each side will be responsible for their own attorney fees and more than $70,000 in arbitration costs.
Bernier was the hospital’s CEO from January 2008 to September 2009.
Stew Cogan, a Seattle arbitrator and mediator who chaired the three-member panel for the American Arbitration Association, said the arbitration was required by Bernier’s employment contract. It was not court-ordered.
He said the arbitration was a private proceeding, and none of the documents involved are public documents.
The binding decision resolves all claims in the dispute, said Christopher Mertens, a Kennewick lawyer who represented the hospital.
K.C. Mehaffey: 997-2512