Ousted Fleishman-Hillard Official Sues Firm, Saying He Is Scapegoat

A former public relations executive whose firm is accused of overbilling the city of Los Angeles sued his onetime employer Tuesday, saying he was made a scapegoat and fired without cause.

Douglas R. Dowie, who was general manager of the L.A. office for Fleishman-Hillard, alleged in the lawsuit that the company’s own investigation found he did not engage in misconduct. Dowie’s lawsuit quotes several executives as downplaying federal and city investigations into billing practices, including one who predicted they would soon be singing “Happy Days Are Here Again.”

The company, according to Dowie’s lawsuit, “terminated his employment in order to scapegoat him for actions of the corporation which have become politically sensitive, and to curry favor with the United States Attorney’s office in Los Angeles and the Los Angeles County District Attorney, despite the fact that plaintiff himself has committed no wrongdoing, a fact well known to the defendant.”

Dowie was fired in January, six months after The Times reported that two former Fleishman employees said Dowie was aware of or encouraged inflated billings and two months after the city controller’s office alleged that Fleishman-Hillard overcharged the city Department of Water and Power by $4.2 million through “unsubstantiated, unsupported and questionable” billings.

The company has acknowledged that about $652,457 in billings over the last five years were not supported by documentation.

The city attorney has sued Dowie and Fleishman-Hillard seeking repayment. The U.S. attorney’s office is also investigating, and one Fleishman executive has been indicted on fraud charges.

Dowie said in court papers he was “summarily terminated” without warning and without good cause.

A former newspaper editor, Dowie said in the lawsuit that he was hired by Fleishman-Hillard in 1991 and was repeatedly promoted, eventually making $370,000 annually, plus bonuses, a car allowance and benefits.

“All of his substantive actions on behalf of [the firm] were with the knowledge, acquiescence and/or approval of defendant,” the lawsuit says. “These actions included ... securing campaign contributions and contracts with Los Angeles public entities -- the bills for which were generated by defendant from its St. Louis headquarters without plaintiff’s involvement.”

Dowie said in court papers he was encouraged to develop relationships with elected officials.

After a May 2003 article in The Times detailed how Dowie engaged in political fundraising for Mayor James K. Hahn at the same time Fleishman-Hillard was awarded multiple city contracts, the firm’s chairman and its chief operating officer called Dowie to say that “despite the publicity, they were extremely happy with plaintiff’s initiative in securing those public contracts,” the lawsuit said.

After the U.S. attorney’s office served subpoenas on Fleishman-Hillard regarding its city contracts, the lawsuit said, Dowie was promoted again.

The lawsuit said that Fleishman-Hillard conducted an internal investigation and that Dowie “has been assured repeatedly that the investigation showed that he had engaged in no impropriety, and that at all times had conducted himself in accordance with the highest ethical standards and exclusively in the interests of defendant.”

The lawsuit also said that after an article in The Times quoted sources saying Fleishman-Hillard overbilled the city and implicated Dowie, the company “in an act of cowardice” placed Dowie on administrative leave with executives telling him they were only trying to defuse the situation.

In the lawsuit, Dowie said he can recall a conference call with company executives in which William Anderson, co-chairman of the operating committee, said that someday “we’ll all be singing ‘Happy Days Are Here Again.’ ”

Fleishman-Hillard regional president Richard Kline said the pending investigations and lawsuits prevent him from discussing Dowie’s specific claims, but he predicted the courts would rule in the company’s favor.