MTA to Pay $325,000 in Whistle-Blower’s Suit

The Metropolitan Transportation Authority has agreed to pay about $325,000 to a whistle-blower who was laid off and then reinstated with back pay after alleging that she was persecuted for exposing the agency’s waste, fraud and abuse.

Under terms of a secret settlement, Amelia Earnest, a buyer and contract administrator with a dozen years on the job, agreed to leave the MTA and to drop her lawsuit against the agency, said Assistant County Counsel Steven Carnevale.

The package calls for Earnest to be paid about $325,000 over a period of several years, Carnevale said. He refused to release a copy of the settlement.

Earnest said: “There has been an agreement.” But she quickly added: “I cannot provide you with the details.”

The settlement is the latest in a string of cases involving whistle-blowers who claimed to have exposed fraud at the MTA or its predecessor agencies.

Earnest drew attention in March 1998 after published reports in which she said she was laid off in November 1997 in retaliation for providing information to the MTA inspector general’s office, the transit agency’s watchdog unit.

The veteran purchasing agent said she had reported instances of contract mismanagement, unsafe working conditions and misuse of public funds to the inspector general.

After being laid off, Earnest filed a lengthy claim against the MTA for damages, saying she was discriminated against, harassed, suspended, demoted, denied promotion, threatened and discharged. After the claim was denied, she filed suit in Los Angeles County Superior Court.

Carnevale said the MTA denied all of the allegations made in Earnest’s lawsuit against the agency. And he said the settlement agreement contains “no admission of liability” on the agency’s part.

Concerned about news reports, the MTA board of directors last spring ordered an investigation into the circumstances surrounding Earnest’s termination.

But the investigative report prepared by agents for Inspector General Arthur Sinai has never been released.

“I can’t talk about that report,” Carnevale said. “Maybe Mr. Sinai will.”

Sinai too refused to discuss it: “I cannot say anything about that. It was an investigative matter. I don’t think it is appropriate since the matter has been settled.”

County Supervisor Zev Yaroslavsky, an MTA director who sought the inquiry, said the MTA board needs to know more about what happened in the Earnest case. “The board needs to get into the detail of this,” he said. “This is a sad chapter that is coming to a close regardless of the pros and cons that people attribute to Amelia Earnest.”

Yaroslavsky said he is concerned about the culture of the MTA that would allow allegations of retaliation to be considered credible.

Supervisor Don Knabe, another MTA board member, said the board agreed to the settlement based on the assistance Earnest had provided investigators.

Court papers show Earnest and her attorney met with agents of the inspector general’s office on two occasions in April 1998 to discuss her termination and other issues.

Almost immediately, MTA chief executive Julian Burke reinstated Earnest with back pay and placed her on paid administrative leave, pending completion of the investigation. She has remained on paid leave for the last year.

Earnest and attorney Marvin L. Rudnick filed a motion seeking to force the MTA to release the report, but the case was settled before a decision was reached on the issue.

In court papers, Earnest said she met with investigators from the inspector general’s office. “After cooperating with the inspector general’s office to expose fraud, waste and abuse for many years, and even though I felt that I was being terminated as a retaliatory act by my supervisors, I agreed to cooperate with the inspector general in April 1998. Several days later, I was reinstated with full pay,” she said.

Despite her participation in the interviews, Earnest said in the court records that “MTA has refused and continues to refuse to provide me this important document and its accompanying exhibits which I believe vindicate me, and proves that my career was destroyed by an improper agreement between my supervisors and a member of the staff of the OIG [inspector] under the authority of defendant Arthur Sinai.”

To fight Earnest’s lawsuit, Sinai retained his own counsel, former U.S. Atty. Robert Bonner. And the agency hired the Century City law firm of Christensen, Miller, Fink & Jacobs to oppose her in court.