Montebello School Executives Awarded $3 Million in Whistleblower Lawsuit

The ex-superintendent of the Montebello Unified School District and another former executive were collectively awarded more than $3 million in compensatory damages Monday stemming from their lawsuit alleging they were fired in 2016 for exposing political corruption within the district.

Former Superintendent Susanna Contreras Smith, who was awarded $2.7 million, and former chief financial and operations officer Cleve Pell, who was given $567,665, contended they were whistleblowers who lost their jobs for coming forward about alleged misconduct by the then-Board of Education and Chief Business Officer Ruben J. Rojas.

The Los Angeles Superior Court jury hearing the case also found that two Board of Education members, Lani Cupchoy and Benjamin Cardenas, acted with malice, oppression or fraud against both plaintiffs, immediately triggering the second phase of trial to determine whether Smith and Pell should be awarded punitive damages.

After hearing testimony and arguments, the jury deliberated for a short time late this morning before ordering Cupchoy and Cardenas to each pay $1 in punitive damages to each of the plaintiffs.

Attorney Matthew Umhofer, for Pell, issued a written statement regarding the verdicts.

"The Montebello Unified School District fired our clients for acting with integrity,'' the statement read. "The jury's verdict makes it clear that the school district and certain board members broke the law when they punished our clients for blowing the whistle on lies, fraud, and corruption. This verdict is a vindication for Cleve Pell, but more importantly, it's a message to the students and parents and teachers of the Montebello that the school board members who did this are serving themselves, not the community. Firing people for reporting fraud is no way to run a school district. We are thrilled with the result, but there's still work to do in Montebello to make sure that the leadership of the school district is what the students deserve."

Defense attorney Daniel Shinoff declined to comment, but the school district released a statement late this afternoon.

"The Montebello Unified School District is disappointed in today's jury verdict in the case of a lawsuit filed by two former superintendents against the district," the statement read. "We are currently examining all our options, which includes appealing the decision and the $1 in punitive damages imposed on both MUSD board members Benjamin Cardenas and Dr. Lani Cupchoy."

During arguments in the punitive damages phase, Shinoff said the panel had sent a message with their verdict in the compensatory damages phase of the case and that it would be heard statewide.

Smith and Pell brought the lawsuit in June 2017. The suit alleged that Rojas, who was in charge of the district's $300 million budget, "was directing lucrative MUSD contracts to cronies in violation of public contracting laws."

Rojas testified during the trial, and denied any wrongdoing.

According to the lawsuit, Smith put Rojas on leave and she and Pell brought their findings to the board, but those efforts were thwarted when the trustees "sought to cover up the web of corruption surrounding Rojas, engineered his return from leave by false pretenses and then voted to terminate Smith and Pell in retaliation for their whistleblowing."

Rojas was hired by the MUSD at a time when the district had begun efforts to upgrade its aging school facilities. But as time went on, the plaintiffs alleged they found out that Rojas was "an individual who had crisscrossed California looking for school districts to exploit for his personal benefit."

Within a year of his hiring, Rojas awarded many lucrative MUSD contracts to people favored by him, violating the state's Public Contract Code and other laws in the process, according to the complaint. But instead of heeding the concerns of Contreras and Smith, the board placed both on leave in 2016 and fired them a month later, according to their lawsuit.

The suit also alleged that Rojas made misrepresentations and omissions about his past employment history when he submitted his application for the MUSD job, from which he was fired in March 2017.

Rojas was originally a defendant in the lawsuit, but the plaintiffs later dropped him from the case.

The ex-superintendent of California's Montebello Unified School District and another former executive have been awarded more than $3 million in a lawsuit that claimed they were fired for exposing corruption.

City News Services reports that a jury on Monday awarded former superintendent Susanna Smith $2.7 million in damages. Former operations officer Cleve Pell was awarded $567,000.

Jurors also found two school board members acted with malice, oppression or fraud against Smith and Pell but they were only ordered to pay $1 each in punitive damages.

Smith and Pell alleged they were fired two years ago for alleging misconduct by district business officer Ruben Rojas, who's since been fired.

The district says it believes Smith and Pell were lawfully fired as the district faced bankruptcy and says it's considering an appeal.