Panel Blast UCI Over Clinic Probe : Fertility: Chancellor disputes state Senate committee’s charges that university made ‘misleading statements.’

The state Senate Select Committee on Higher Education blasted UC Irvine on Friday, accusing its top administrators of incompetently managing the fertility scandal encircling its once-prestigious Center for Reproductive Health and of concealing critical information.

The committee, chaired by Sen. Tom Hayden (D-Santa Monica), cited a litany of instances in which the university’s conduct had left lawmakers both “dismayed and frustrated” in trying to get to the bottom of an ever-widening imbroglio.

“We understand the difficulty of accumulating and organizing information when one is under such serious pressure,” read the committee’s letter, which was hand-delivered to the UC Board of Regents at its meeting in San Francisco on Friday in hopes of convening a hearing between the regents and their legislative counterparts.

“However,” the letter continued, “we believe the university’s misleading statements and omissions impeded the Legislature’s investigation of the fertility clinic.”

UCI Chancellor Laurel L. Wilkening took issue with much of the content of the committee’s letter, relaying her comments in the form of a letter she wrote to UC President J. W. Peltason.

“I am puzzled as to why these misconceptions are raised now when the facts have been previously and openly presented,” Wilkening wrote.

Peltason, in his own response to Hayden’s committee letter, said late Friday that he shared many of the concerns raised by the fertility clinic, noting, however, that the university’s understanding of the facts differed from those of Hayden’s committee.

Hayden’s committee launched an all-day inquiry into the scandal June 14 and plans another later this fall. But despite requesting “all relevant information concerning the operations of the fertility clinic and the university’s oversight mechanisms,” recent events have presented a string of disturbing surprises, the committee said.

In an interview Friday, Hayden said that he and his colleagues were “deeply concerned over the university’s apparent lack of disclosure despite the fact that the university promised at the time [of the June hearing] to be fully cooperative.”

The committee used the letter to voice its displeasure over learning through press accounts that in April and May, lawyers for UCI were “privately negotiating” a settlement with Drs. Ricardo H. Asch, Jose P. Balmaceda and Sergio C. Stone, who have been implicated in the scandal.

The three have been accused of stealing eggs and embryos, conducting human-subject research without the consent of patients, and misappropriating university funds. They are now the target of at least seven investigations, including inquiries by the FBI and the U.S. attorney’s office. All three have vigorously denied any wrongdoing.

Had the doctors reached a settlement with UCI, they would have been able to “quietly resign,” the committee said, adding, “we were dismayed and frustrated that the university had not provided the Select Committee with this important information.”

Hayden said he was stunned to learn of such secret negotiations, characterizing his discovery this way:

“That’s when the real bomb dropped. The disclosure--which came solely through the Freedom of Information Act--that they had been privately negotiating a settlement with those doctors that would allow the matter to be essentially covered up. . . . I couldn’t believe it.

“It confirmed a suspicion among legislators that no one wanted to believe, that the university was concealing information during our hearings. Their public line was that they were coming down hard on these doctors and that the system of oversight was being strengthened. Obviously, that wasn’t really the case.”

Wilkening, in her response letter, said the university sought the doctors’ resignations in March and April, feeling it was “in the best interest of UCI faculty, students and patients.” But, she noted, the physicians refused to resign because of the university’s demand that its findings be reported to the Medical Board of California and other agencies.

Hayden said his committee ended up feeling frustrated by UCI, which he blamed for inciting a “steadily mounting cynicism toward the entire university process, felt by Republicans as well as Democrats. As a result, this whole thing has been brought to a boil.”

Since the scandal broke earlier this year, about 40 patients have reported allegations, and more than 30 have taken some form of legal action against either UCI, the doctors or both. Even university officials concede that as many as seven live births may have resulted from the scandal, which has extended to other institutions, including UC San Diego and Cornell University.

But the focus remains on UCI, which Hayden’s committee accused of not being “completely forthcoming” in other ways.

For instance, lawmakers chastised Wilkening for telling the press that she had not learned of the allegations of egg misuse until the summer of 1994, when one of the whistle-blowers filed her complaint.

“However,” the letter reads, “the committee learned that the chancellor had knowledge of the egg allegations as early as April or May of 1994.” The letter goes on to say that Wilkening then told her legal counsel that UCI auditors should “not go back to Dr. Asch and press him hard for additional records at this time.”

In her letter, Wilkening responded by saying that, after reviewing her calendar, “I have clarified my earlier remarks to the press to reflect that I was informed in May of 1994 of the allegation of unconsented transfers.”

She admitted making the comment to auditors about not pressing Asch for additional details, but said in her response letter, “These notes also reflect that I wanted to consult with the Office of UC General Counsel and the Dean of the College of Medicine to determine the future course of the investigation.”

In fact, she noted, the auditors later demanded documents and information from Asch on June 14 and June 20, “thus there was no delay in the investigative process.”

She also disputes Hayden’s contention that the university did not officially investigate the egg allegations until October, 1994. She said the university began a thorough investigation in March, 1994, leading to a clinical panel investigation in October of last year.

In its letter released Friday, the committee demanded of the regents a series of reforms, which it said were necessary to curtail such scandals in the future and to provide greater protection of public funds:

* Members called for a strengthening of oversight mechanisms, saying that allegations of egg misuse were reported to auditors in September, 1992, but not officially investigated until October, 1994.

UCI Medical Center executives “were made aware of the egg allegations in 1993,” the committee said, “yet the egg misuse was not reported to the Chancellor until the spring of 1994. The university did not terminate the employment of Drs. Asch, Balmaceda and Stone until May, 1995.”

* The committee excoriated UCI officials for having paid out $900,000 in settlements to whistle-blowers without even consulting the Board of Regents, much less obtaining their approval. Although the committee conceded that “Regental approval is not required for settlements which do not arise out of litigation,” its members demanded that regents be afforded a much more powerful role in the future in overseeing such large settlements.

* The committee took exception with settlements that carry with them “confidentiality clauses prohibiting complaining employees from discussing their claims,” noting that such clauses are in violation of the Public Records Act and thus legally indefensible.