Secrets and Lies 

It's hard to say who'll prevail in two whistleblower lawsuits against Alameda County, but the facts are mighty suspicious.

At some point, every journalist grapples with these two questions: 1) If a man lies about one thing, does it mean he'll lie about everything? And 2) when the timing of events is highly suspicious, does it mean they're related, or is it merely a coincidence?

Alameda County jurors may soon have to face those questions as well in civil cases involving current and former top executives at the Alameda County Medical Center, which includes Highland Hospital in Oakland.

The cases stem from whistleblower lawsuits filed by Alberto Diaz, Highland's former interim CFO, and William Mattox, the medical center's onetime VP of human resources. Both claim that the medical center's chief executive, Wright Lassiter III, fired them last year after they complained about his alleged financial wrongdoing. They also claim Lassiter further harmed the already financially strapped center, which owes the county about $200 million.

If true, the allegations could end Lassiter's career and place another black mark on this long-troubled county bureaucracy. But in the case of Mattox, at least, jurors will have to decide whether his past lies render his current allegations baseless.

Get ready, because this story is full of twists and turns: It begins in early 2005, when Mattox and Diaz landed jobs at the medical center within weeks of each other. They were tasked with fixing myriad problems at the center, especially Highland, which is the main trauma hospital for northern Alameda County and serves the area's poorest residents.

That October, Mattox and Diaz got a new boss — Lassiter. Diaz was then the hospital controller, but Lassiter was impressed with him and quickly promoted him to interim CFO. But within weeks, Diaz began issuing complaints about his new supervisor. According to Diaz's lawsuit, he confronted Lassiter, and made several allegations; among them, that his boss had:

— Improperly approved a $50,000 moving expense for a medical center employee who also was Lassiter's friend.

— Awarded a $50,000 "forgivable" loan to a new employee.

— Engaged in off-the-books deals with medical center vendors.

— Failed to get approval from the board of trustees for out-of-state travel and reimbursements.

— Paid some staff wages out of petty cash and gave some employees retroactive pay they weren't entitled to.

Diaz shared his allegations with then—medical center trustee Gwen Rowe-Lee Sykes, who on November 29 wrote a scathing letter to her fellow board members — the trustees oversee the CEO — complaining of Lassiter's alleged financial wrongdoing. Sykes copied Lassiter on her letter, which revealed that Diaz was the source of some her claims. One month later, Lassiter demoted Diaz back to controller.

Around the same time, Mattox said in court papers that he'd taken his complaints about Lassiter to the county grand jury, which was investigating the center. Mattox said he testified in secret in front of the grand jury on three occasions from December 2005 to March 2006. At the time, one of the grand jurors was former Berkeley Police Chief Ron Nelson, grand jury documents show. More on Nelson in a moment.

Meanwhile, Sykes had been sharing many of her complaints with Keith Carson, then the president of the Alameda County Board of Supervisors, who had nominated her to serve on the Medical Center board.

In an interview last week, Carson said that in early 2006, he invited medical center employees who wanted to make complaints to a meeting in his office. Carson said he also invited Lassiter, but specifically warned him not to retaliate against anyone who came forward.

But a few weeks later, on February 15, Carson himself fired Sykes from the board of trustees. Carson explained that he had received numerous complaints from other trustees about Sykes, who has a reputation for being highly confrontational, and who was constantly voicing her allegations of wrongdoing. "They said she was making the board intractable," Carson said. "The board couldn't operate because of her style."

Sykes, however, immediately sued Carson and the board of supes, claiming that Carson didn't have the power to fire her — only the entire board of supervisors could do that. She also alleged that Carson terminated her in retaliation for being a whistleblower. However, before Sykes' lawsuit could go anywhere, the board of supes voted unanimously to fire her on March 14 at Carson's request.

Carson said that around the same time, then-county Sheriff Charlie Plummer urged him to appoint Nelson to the medical center board of trustees. Plummer and Nelson are friends; Plummer also is an ex-Berkeley police chief. Carson said that even though his staff had vetted Nelson, he didn't know — until Full Disclosure told him — that Nelson was a member of the grand jury and that the grand jury was investigating the medical center. "Had I known that then, I would have been concerned," the supervisor said.

On April 25, less than three weeks after Sykes' suit was dismissed, the board of supes appointed Nelson to the medical center board of trustees. The next day, Nelson resigned from the grand jury. A day later, Lassiter put Diaz on administrative leave, and Diaz would never work for the center again. On May 30, Lassiter fired Mattox.

In his lawsuit, Diaz claims he was fired for making complaints about Lassiter and for supplying information to Sykes. But Mattox makes the most explosive allegations. He was fired, he claims, because Nelson shared Mattox's secret grand jury testimony with Lassiter and the medical center trustees before Nelson was appointed to the board.

Mattox has not yet offered any proof to substantiate this allegation. But there's no denying it is very strange for a grand jury member investigating a public agency to then be appointed to replace a board member of that agency who got fired after making allegations of wrongdoing — and then, for that same grand jury member to preside over the firing of two top executives of the agency, one of whom had testified before the grand jury. If you followed all that, then you tell me: coincidence or conspiracy?

Nelson did not return phone calls seeking comment for this story. Jeff Stark, the county prosecutor who oversees the grand jury, called Mattox's allegation "pretty serious" and said it would have been a crime for Nelson to reveal Mattox's testimony. But Stark, citing grand jury secrecy rules, would not say whether Mattox's allegations were ever investigated.

Oakland attorney Andrea Carlisle, who represents Lassiter, said he denies doing anything wrong. In a statement, medical center spokeswoman Andrea Breaux said: "We are confident that once the judicial process is complete, the allegations will be shown to be without merit."

In court papers, Diaz said Lassiter had told him he was fired for misappropriating funds. But Diaz called that allegation "untrue and malicious." It also fails the sniff test. After all, Lassiter's allegations against Diaz came after Diaz first made very public allegations against him.

But with Mattox, things get messy. Carlisle has already shown in court that Mattox lied on his résumé and his job application before he was hired at the medical center. For instance, Mattox said on both documents that he was a human resources director for the accounting firm Deloitte & Touche from 1999 to 2001. But court records show that Mattox sued Albertson's in 2001, also alleging wrongful termination. At the time, he claimed he'd been a human resources exec for the grocery chain at the same time he was supposedly working for D&T. Carlisle said she will use these facts to impeach Mattox's credibility if the case goes to trial.

Oakland attorney David Weintraub claimed Mattox's obvious lie was merely "a mistake," and that his client didn't intend to mislead the center. "It was the best he could remember at the time," the attorney said.

That sounds like a lawyer making excuses for his client. Then again, just because Mattox lied on his résumé, it doesn't mean he's lying about this other thing. Does it?

Spoils of Bad Management

Several months ago, we told you about two experienced investigators who sued Alameda County Public Defender Diane Bellas, alleging that she had cooked up a bogus story about racial tensions in order to pass them over for promotion. Well, thanks to a public records act request, Full Disclosure has learned that the county has agreed to settle the case by paying the plaintiffs, Steven Todar and Paul Perez, $220,000 each.

The county admitted no wrongdoing in the settlement, but a review of the case makes it clear that Bellas completely screwed up, and as a result cost taxpayers nearly a half mil. That's par for the course for Bellas, who has run roughshod over an office that once enjoyed a reputation as one of the state's best. Since she took over in 1999, her iron-fisted style and habit of rewarding inexperienced friends with senior positions have sent some of the best defense lawyers in the East Bay scrambling into private practice.

The Todar and Perez snafu began in early 2006, when Bellas decided to promote Todar to be the office's chief investigator. The decision immediately sparked outrage, because Bellas had passed over two investigators with more experience, Robert Caturegli and Mark Stroup.

Realizing her mistake, Bellas quickly asked Todar, who is white, to give up his promotion, telling him that black employees were angry and were going to sue because they believed she should have picked an African American. Todar played the good soldier, but Bellas then double-crossed him by promoting Caturegli, who's also white. The move also angered Perez, who claimed that Bellas illegally used race as a factor in promotion.

County Counsel Richard Winnie refused to comment on the case or the settlement, and Bellas did not return calls seeking comment. Inside sources said earlier this year that the whole mess could have been avoided if Bellas had originally promoted Caturegli and then not fed Todar a "bullshit" line about race.


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