Central Health negotiating settlement in million dollar lawsuit

Lawsuit filed by executive fired over alleged sexual harassment

Larimen Thaddeus “Larry” Wallace’s employment at Central Health was terminated in December 2019. The triggering event was a complaint of his alleged sexual harassment of a female member of the agency’s board of managers.

Wallace, now 72, has a history of inappropriate sexually oriented comments documented in his personnel records obtained by The Austin Bulldog and published in an investigative report October 30, 2020. In December 2016, Wallace was given training in “sexual harassment avoidance” by an outside attorney.

In addition, The Austin Bulldog’s investigative report contained statements from two other women who stated in detail how they and others had experienced his unwanted touching.

The Central Health executive, whose annual pay had been $297,950, filed both internal and EEOC complaints of racial discrimination and retaliation being the basis of his termination. Neither complaint was substantiated. The EEOC gave him a letter of permission to file a lawsuit.

Before filing suit Wallace offered to settle claims against Central Health in return for two years wages and benefits, about $775,000. Instead, the agency’s board of managers offered to continue negotiations. The next day Wallace’s attorney, Colin Walsh of Wiley Walsh PC, sued in state district court for more than $1 million. (Cause No. D-1-GN-20-006645).

Central Health then removed the case to federal court (Cause No. 1:20-CV-1191-RP) because Wallace asserted claims under federal laws.

Central Health’s outside attorney in the case, Stephanie Rojo, a partner with Thompson Coe Cousins & Irons LLP, twice filed unopposed motions for an extension of time to allow the parties time to conclude negotiations. The first motion was filed December 11, 2020, the second January 11, 2021. Even now those settlement negotiations are ongoing.

U.S. District Judge Robert Pitman on January 27, 2021, signed an order stating the parties had agreed to settle all claims and to expect a stipulation to dismissal within 60 days. The case was stayed until March 26, 2021.

Parties tight lipped about negotiations

Walsh, Wallace’s attorney, responded to The Austin Bulldog via email January 27, stating, “We have no comment at this time on the Central Health lawsuit.”

Ted Burton, Central Health’s vice president of communications, told The Austin Bulldog on January 27 that “It would probably be a few weeks” before a settlement was completed.

This morning Burton emailed an official statement. It said the agency’s Board of Managers had delegated to President and CEO Mike Geeslin authority to complete the settlement. Further, the female board member who lodged the complaint “does not wish to comment at this time.”

What is not clear is—if Central Health has evidence of Wallace sexually harassing women that was substantial enough to terminate his employment—why would the agency choose to settle instead of presenting its case in federal court? Burton did not address that question.

What triggered the board member’s complaint?

The Austin Bulldog has not obtained a copy of the findings of the county attorney’s investigation into the board member’s complaint. In response to a public information request for it, the county attorney’s office on October 14, 2020, requested a ruling from the Texas Attorney General’s Office on whether the document could be withheld. The Attorney General’s office issued a ruling December 23, 2020.

Austin attorney Bill Aleshire of Aleshire Law PC, who represents The Austin Bulldog, after reading the attorney general’s ruling, said it “permits Central Health to withhold the entire the entire report, even the ‘adequate summary’ that would not otherwise be considered confidential.

“It should be noted that the district could waive the attorney-client privilege and release the summary, but according to the AG, they are not required to.”

So what really happened?

As a result of Central Health withholding information that’s in the county attorney’s report, the public is left without knowing specifically what Wallace allegedly did to the female board member. All that’s been discovered through public information requests is Wallace’s own account.

Wallace stated in a memo that he participated in an investigation of the sexual harassment complaint by meeting with Travis County attorneys September 26, 2019—just a week after the photo session in which the incident occurred.

“I was informed that (the complainant)…was offended because I had placed my arm around her during the photo shoot. I asked why (she) did not express discomfort to me, given our non-threatening relationship, and simply ask me to remove it. The attorneys had no answer.

“I…asked if (she) stated I touched her in sensitive areas, such as her breasts or buttocks, and was told no. Under the circumstances I have described, I strongly believe I am the victim and am being targeted. As a friend and often a mentor, I respectfully complied with (her) request for a photo, which I still have not seen.” The Texas Attorney General’s Office has ruled that those photographs may be withheld from release.

How would victims react to a settlement?

A former Central Health employee, a female, was quoted in The Austin Bulldog’s investigative report. She spoke for that report on condition that her name not be published.

“The reason I’m even talking to you is I want the truth to come out. This is not about racial discrimination. It was never about (that). I tried my hardest to keep anyone else from being sexually harassed and I was unsuccessful. Another person was hurt because of his action. To consider the board might compensate him in any way—when termination was clearly for sexual harassment—is offensive to me.

“I have lot of sadness and angst. Even though I tried to impact the culture I was unsuccessful, which resulted in another incident (with the board member). All this could have been prevented if appropriate action could have been taken—should have been taken.

“I know at least four women who have been affected,” she added.

Trust indictors: Ken Martin has been doing investigative reporting in the three-county Austin metro area since 1981. His aggressive reporting twice garnered first-place national awards from the National Newspaper Association for investigative reporting. Both of those projects resulted in successful felony criminal prosecutions, one for a Williamson County commissioner, the other for a con man based in Austin. You can read more about Ken on the About page.