Metra’s ex-CEO wants his job back
BY ROSALIND ROSSI Transportation Reporter August 21, 2013 7:27PM
Former Metra CEO Alex Clifford testifies before the Regional Transit Authority board in Chicago on Wednesday, July 17, 2013. | Scott Eisen~AP
Updated: September 23, 2013 2:47PM
Alex Clifford is interested in rejoining Metra as CEO and would be willing to reopen his controversial separation deal to be rehired — under certain circumstances, Clifford’s lawyer said Wednesday.
But the attorney, Michael Shakman, contended that Metra officials can’t unilaterally “undo” Clifford’s 26-month farewell handshake or try to tap a $10 million insurance policy to cover some of the maximum $871,000 settlement tab, as some officials have suggested.
“If they want to reduce their obligation, Mr. Clifford is willing to talk about a new employment agreement extending some years into the future,’’ said Shakman, known best to some as the original plaintiff in a landmark City Hall hiring and firing case.
Shakman commented Wednesday after members of the RTA board, which oversees Metra’s finances, heard the initial results of an RTA audit into the Clifford deal and approved a resolution declaring it “not financially prudent.’’
The resolution also urged Metra to conduct “a thorough examination of its insurance policy’’ to see if a claim could still be filed.
RTA chairman John Gates Jr. even contended in a written statement that, “if it would still be financially prudent,’’ Metra should “immediately cancel Clifford’s severance agreement.’’
A Metra spokesman confirmed Wednesday that Metra is exploring just that, as well as its insurance options.
Metra Board members have said they were never fully briefed on the insurance policy or told that it could have covered up to $10 million — after a $150,000 deductible — if Clifford had filed a threatened whistleblower lawsuit.
To avoid the cost of such a suit, board members say they signed on to the $871,000, 26-month deal to buy Clifford out of his contract eight months early.
Shakman said Wednesday that Clifford would never come back for the mere eight months left on his contract at the time of his June 21 resignation.
But, Shakman said, “He has expressed an interest in coming back as executive director. As part of negotiating a new employment agreement, he’d be willing to talk about modifications to the separation agreement, which goes to [August] 2015.’’
The package gave Clifford two retroactive pay increases as well as two prospective raises stretching into the future. The last 12 months of the deal would involve no payout if Clifford found a higher-paying job — but, critics note, he’d get two raises if he sat home and did nothing.
During Wednesday’s RTA board meeting, RTA audit director Michael Zumach contended that the separation agreement was poorly researched, poorly documented, unusually long and unusually generous. Before agreeing to it, he said, Metra board members should have been fully briefed on how they could have tapped Metra’s $10 million insurance policy, but they weren’t.
RTA Board member William Coulson, a former federal prosecutor presented a legal “forensic analysis” of Clifford’s claims at Wednesday’s RTA board meeting. He said he was “astonished” that an April 3 letter from Clifford’s attorney, threatening a possible whistleblower suit, wasn’t used to kick off an insurance claim.
If it had been, Coulson said, insurance could have picked up not only the cost of a settlement, but a host of costs surrounding it.
Zumach agreed, telling RTA board members that once Metra received the April 3 letter, “you would have thought” Metra’s outside counsel would have met with Metra’s insurance company at that point to “start figuring out what your strategy is going forward because you have a very high indication of pending litigation.’’
Metra’s insurance coverage is provided by Illinois National Insurance Company, documents provided by Metra indicate.
RTA board member John Frega, of the Frega Associates architecture and engineering firm, said after Wednesday’s meeting that he doubted Metra would have much luck in pursuing an insurance claim at this point.
“It’s worth asking, but from what I know from insurance companies, once you make a settlement it’s difficult to go back and ask for help from an insurance company,’’ Frega said.
Acting Metra Chairman Jack Partelow has said Metra is ending its relationship with outside counsel JG Law, which represented board members during Cliffords’ threatened legal action.
JG’s Andrew Greene said Wednesday that JG asked out of the relationship first. But Metra board member Jack Schaffer said JG was “maybe 20 minutes ahead” of Metra in doing so.
When Greene told board members on Friday that he was ending their relationship, “everybody said that was a really good idea,’’ said Schaffer, the only Metra board member to vote againt the Clifford settlement.
Schaffer said Metra board members were “very upset”’ to learn Friday that insurance would have covered the cost of possible Clifford litigation.
“People were upset that they had not been told the whole story and they made a decision that didn’t make sense in light of the insurance policy,’’ Schaffer said.