Bishop Must Clarify Monaghan’s “Ministerial” and Juridical Claims

COMMENTARY:
An Open Letter to His Excellency Bishop Frank Dewane of the Diocese of Venice

Feast of St. Thomas More

On Wednesday June 17, Mr. Tom Monaghan - an official resident of your Diocese - entered a motion into a Michigan court claiming that the ecclesiastical consent given to Ave Maria School of Law to use the title “Catholic law school” extends so far as to bar trial courts from examining AMSL’s administration of law professors because they are “ministerial”.

Mr. Monaghan claimed that AMSL is a “religious institution” whose law professors are  “ministerial employees”; thus, his administration over these minister-professors is exempt from civil trial court under “the Establishment and Free Exercise of religion clauses of the First Amendment”.  He also claimed that the institution is eligible for “ecclesiastical abstention”, requiring courts to “abstain from inquiring into, or interfering with, governance of the religious institution..”.  Monaghan cited the Code of Canon Law to make these points.  A copy of the motion is here:  http://www.avewatch.com/ftpfiles/june09_1_mtn.pdf

The implications of Mr. Monaghan’s claims are exceedingly important to Catholics in your Diocese, and around the country, in terms of church-state jurisdiction over a private endeavor such as Ave Maria School of Law.  If we take Mr. Monaghan at his word, and a trial court lacks any authority to examine the contracts with, and treatment of, employees in this “Catholic law school”, then questions arise:

• Do you or Mr. Monaghan have jurisdiction over employment disputes?
• Are these “ministerial” law professors authorized by you to speak on behalf of the Catholic Church?
• What is the role of the Diocese in evaluating the performance and qualifications of these minister-professors?
• When did the Diocese award ecclesiastical authority to AMSL?
• If AMSL is exempt from civil trial courts, are employees, alumni, and students expected to appeal to your jurisdiction in matters concerning Mr. Monaghan’s “religious institution” located in your diocese?

The implications of Mr. Monaghan’s claims are important.  Dr. Edward Peters, canon lawyer and professor, has already described several problematic assertions (see http://www.canonlaw.info/2009/06/if-safranek-et-al-were-professor.html).  Mr. Monaghan is using this argument to prevent a trial court from hearing the wrongful termination case of former AMSL professor and co-founder Stephen Safranek (see the legal response to Monaghan’s claim at http://www.avewatch.com/ftpfiles/june09_2_mtn_resp.pdf)

Mr. Monaghan’s assertions are serious.  If the trial court judge accepts all or part of his argument, there could be significant civil and canonical repercussions felt throughout Catholic education for years to come.  Dr. Peters writes:

“Should Ave Maria’s argument get so much as the time of day from the trial court, I predict we’ll see amicus briefs from the grown-ups at the United States Conference of Catholic Bishops and the Association of Catholic Colleges and Universities, to name just two of the dozens of groups with a major stake in these matters, urging appellate courts to reject any theories by which denominational university faculty can be suddenly characterized as “ministerial employees” and consequently stripped of a variety of civil rights.”

Judge Melinda Morris of the Washtenaw Country Circuit Court will issue her decision sometime before July 15.

With all due respect:  It is imperative that you immediately consider a public statement to addresses Mr. Monaghan’s ministerial claims and the subsequent implications on your juridical authority and his.

Thank you for your consideration.

Related AveWatch Articles:

• Full story:  Monaghan Legal Claim: Ave Maria Law is “Religious Institution” with “Ministerial” Professors
• Analysis:  Canon Lawyer: Monaghan is “laugh-out-loud ridiculous” to Claim Ave Maria Law Professors as Ministerial

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Canon Lawyer: Monaghan is “laugh-out-loud ridiculous” to Claim Ave Maria Law Professors as Ministerial

As predicted, waves are being created well beyond the courtroom as a result of Tom Monaghan’s legal claim to running an exempt “religious organization” of “ministerial” law professors at Ave Maria School of Law.

Renowned canon lawyer Dr. Edward Peters posted a must-read analysis at “In the Light of the Law”.  Excerpts:

… ask the local Catholic bishop whether he considers Ave Maria law school professors to be ecclesiastical ministers authorized by him to speak on behalf of the Catholic Church? Betcha he’ll deny it faster than Tom Monaghan can say a Hail Mary, which is pretty darn fast. It is even more preposterous to assert that canon law considers ecclesiastical recognition of the Catholic character of a given school (assuming Ave Maria has that) as rendering the school immune from civil scrutiny in regard to the basic treatment it accords faculty (and students and staff, for that matter). That is goofiness.

But, however goofy it is, we should be clear: In the world beyond the moat behind which sits Tom’s Town, the implications of his claim are very serious. Should Ave Maria’s argument get so much as the time of day from the trial court, I predict we’ll see amicus briefs from the grown-ups at the United States Conference of Catholic Bishops and the Association of Catholic Colleges and Universities, to name just two of the dozens of groups with a major stake in these matters, urging appellate courts to reject any theories by which denominational university faculty can be suddenly characterized as “ministerial employees” and consequently stripped of a variety of civil rights.

I keep waiting for Ave Maria to find a bottom in how far it is willing to descend in its efforts to avoid treating certain Catholics (the sort Monaghan dismisses as “academic terrorists”) with due dignity. But this month, Monaghan and Ave Maria tried to label its law school faculty as some sort of religious ministers, conveniently according their academic administrators a discretionary power over Ave Maria law faculty akin to that legitimately enjoyed by bishops over priests!

Background information on Monaghan’s court claim, including the accompanying court documents, can be found here.

Updates -

• Fumare author Casimir Pulaski offers an interesting analysis:  Excerpt - Monaghan’s motion for summary disposition posits that the Bishop’s approval of AMSoL to use the title “Catholic” extends so much of a degree of agency for the Catholic Church that a trial court is prohibited from looking into the decisions of Monaghan and the board because they are religious matters, “ministerial.”  Is AMSoL listed in the diocese as an asset of the Bishop? Did the Bishop exihibit final authority over AMSoL matters?

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*Monaghan Legal Claim: Ave Maria School of Law is a “Religious Institution” with “Ministerial” Professors

In a stunning legal maneuver that could trigger unintended negative consequences involving a host of sources (Catholic legal academics, the American Bar Association, Ave Maria students/employees/alumni/recruits, official Church authorities) — Tom Monaghan’s lawyers argued in court on Wednesday that Ave Maria School of Law is a “religious institution” claiming “ministerial exception” such that any inquires into their “underlying motivation for a contested employment situation” should be barred from government courts.  They also argued that AMSL’s law professors are “ministerial employees”, claiming that the “legal doctrine of ‘ecclesiastical abstention‘ is pertinent to the court’s lack of subject matter jurisdiction of AMSL’s employment decision and the allegations concerning AMSL’s governance”.

Washtenaw County Circuit Court Judge Melinda Morris will issue a written opinion within thirty days on Monaghan’s motion for summary disposition.  Click below for more, including links to public court documents and excerpts.

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Michigan Justices Get Monaghan $, Support His Arguments

The recent dissenting opinion of Michigan Supreme Court Justice Stephen Markman raises an interesting set of questions on legal ethics.  Was Markman’s favorable opinion toward Tom Monaghan influenced at all by campaign support?

The law and culture blog “Fumare” (H/T) first pointed to The Michigan Campaign Finance Network (MCFN), “a nonprofit, nonpartisan coalition of organizations and individuals concerned about the influence of money in politics and the need for campaign finance reform in the state of Michigan.”  Richard Robinson, Executive Director of the MCFN, offered the following testimony to the House Judiciary Committee in October 2007 (excerpt; emphasis added; full text PDF):

Independent expenditures represent another sort of peril. Because Michigan has no limits on contributions to political parties or political action committees, and the independent expenditures of such committees cannot be limited, independent expenditures present an unlimited opportunity for an individual or an interest group to support or oppose a candidate, and, thereby, influence the outcome of an election.  I will give you two examples.  In 2000, Thomas Monaghan put $655,000 into the Ann Arbor PAC, 86 percent of its funds for the election cycle.  The PAC, in turn, gave $34,000 each to Justices Markman, Taylor and Young; and it made over $200,000 worth of independent expenditures supporting those justices. This should invite a question: If Monaghan has a case before the Michigan Supreme Court, should those justices recuse themselves?  Should it be a matter of personal conscience, or should there be a standard?

Last week, a Monaghan case was before the Court.  Of the three Justices that MCFN noted, two supported Monaghan’s argument (Markman, Young).  The third mentioned by MCFN, Justice Taylor, is now a Monaghan employee at Ave Maria School of Law.

Another excerpt from the MCFN testimony:

To borrow from Chief Justice John Roberts’ baseball analogy where he characterizes judges as the umpires of society:  If one team pays to hire the umpire, can the umpire be expected to call balls and strikes fairly and impartially when that team comes to bat? Do we suppose that this would be agreeable to the opposing team? Would spectators and future players think that this was a fair practice?

To be clear, AveWatch is not making any specific accusations against these Justices.  We are asking if the significant unrestrained money spent on judicial electioneering is responsible for creating an inherent compromise to a Justice’s impartiality?

Related AveWatch Article:
“Michigan Supreme Court: Monaghan Must Produce Notes”

Update - Commentary and analysis at Fumare: (H/T)
“AveWatch: Monaghan Funds to Mich. Sup. Ct”

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Michigan Supreme Court: Monaghan Must Produce Notes

UPDATE - The Ann Arbor News and Michigan Radio picked-up the story.

Original AveWatch Article:
The Michigan Supreme Court issued a decision on Friday June 12 (PDF) that requires Tom Monaghan to turn over personal notes in the wrongful termination suit filed by three former Ave Maria School of Law professors.

The professors’ legal team initially requested the notes in March 2008.  In September 2008, they submitted an affidavit that offered a compelling example of how a known smaller subset of Monaghan’s notes were relevant to the suit, suggesting that a plan for retaliation may have existed for 11 so-called “dissident” professors:

November 4 Goals
5 down, 6 to go. 2 leaders gone.  Now they are in the minority.

See the AveWatch article “5 down, 6 to go - Tom Monaghan’s ‘Plan of Unlawful Retaliation’”

Justice Markman wrote the dissenting opinion for the Supreme Court.  It is difficult to not see his response as a weak attempt to simply protect Monaghan from public embarrassment over his own actions in managing Ave Maria.  The response contains errors, including an accusation that the professors’ attorneys provided AveWatch with material that “had not yet been filed with the trial court and that defendant had not been afforded an opportunity to designate as ‘confidential’”.  Even worse, Markman implies that one of the professors’ attorneys spoke falsely in court about sending AveWatch a photo of the “5 down” note.

Markman cites a passage from the aforementioned AveWatch article, but literally skips the first sentence of our account and deletes an intervening sentence (compare his Footnote #4 to our article).  In those edited sentences, AveWatch clearly stated that our source of information was the affidavit and the motion.  We did not publish the photo because we never saw the photo.  Our article was published in the afternoon on September 25 and included the affidavit and motion as scanned PDF downloads.  The plaintiff’s attorney photographed Monaghan’s “5 down” note on September 19 according to the affidavit.  If AveWatch circumvented the court’s due process for documents, then why didn’t we publish the real photo (instead of the court documents), and do it on the 19th or 20th (instead of 5 or 6 days later)?

It is difficult to believe that three justices of the Michigan Supreme Court could make such accusations and miss/edit our clear statements of fact.  This error should be rectified by the court.

On Markman’s issue of affording Monaghan an opportunity to designate a document as “confidential”: Does a defendant clear/approve a plaintiff’s affidavits and motions before they’re filed? - No.  Was the “5 down” note obtained by some irregularity? - No.  This subset of notes was offered by a Monaghan staffer to the plaintiff’s legal team to view as part of the discovery process.

Today, in the Washtenaw County Circuit Court of Judge Melinda Morris, Tom Monaghan’s legal team tried to stall the Supreme Court’s decision and, once again, argued for a delay in the production of Monaghan’s notes.  Judge Morris was unequivocal - “Produce the notes.”  She gave them until Wednesday June 24.

More is forthcoming on today’s public hearing in which the Ave Maria defense pushed for summary disposition on the grounds that Ave Maria School of Law is a “religious organization” with legal professors who are hired to function in a “ministerial” capacity.

Commentary and analysis at Fumare:

• AveWatch on Mich. Sup. Ct. Decision in Safranek v. Monaghan
• Feiger Proven Right: Markman is delusional with power
• Michigan Supreme Court: Monaghan Required to Turn Over Personal Notes

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Cooley Law: Happy With Ave Maria’s Ann Arbor Campus

The irony is rich.  Today’s Ann Arbor Business Review announced that The Thomas M. Cooley Law School will take over the Ave Maria School of Law’s campus in Ann Arbor.

Unlike Tom Monaghan, Cooley sees the strategic importance of having a law school in Ann Arbor near the University of Michigan:   “That we will open a campus in Ann Arbor is one of the most exciting events in our school’s history.” (Don LeDuc, Cooley Law School President and Dean)

Contrast that with excerpts from Monaghan’s February 20, 2008 deposition:

Q: Isn’t there a significant advantage to attracting students and faculty to an area where you have one of the top universities and law schools in the United States as your neighbor?
TM:  I wouldn’t think so.
Q:  Have you asked anybody that?
TM:  Huh?
Q:  Have you asked anybody that?
TM:  It’s competition.
Q:  Have you asked anybody that, such as your faculty members?
TM:  I don’t remember specifically asking anybody that.

The faculty of Ave Maria School of Law finally spoke on the matter by passing a September 2006 resolution that succinctly summarized the significant strategic benefits of staying in Ann Arbor (PDF).  Cooley acknowledges a few of those benefits on the website profile of their newly acquired campus (excerpts):

Ann Arbor is considered one of the most desirable places to live in America, along with being one of America’s great university cities. It has a bustling business sector, particularly in technology, and a lively arts and entertainment culture.
Cooley’s facility is located very near to the University of Michigan’s north campus and is just a few minutes from downtown Ann Arbor and the University’s main campus.
The Ann Arbor Campus includes a small class size, low student to faculty ratio,.. easy access from two major limited-access highways, and easy access to downtown Ann Arbor’s great restaurants, arts, and entertainment venues.
We chose this location because … there are two major universities in the area that produce on average over a thousand graduates per year with only a small number enrolling in the University of Michigan Law School, and because the area is one of the best known and most desirable university and business communities in the country.
We anticipate that students will choose this location over other national locations.

As of this morning, Cooley said that 84 students sent deposits to attend the Ann Arbor campus.

UPDATE:

•  The Ann Arbor News adds a story (excerpt):  Paul Zelenski, associate dean for enrollment and student services at Cooley: “The level of interest among these existing applicants demonstrates how desirable an Ann Arbor location is for a law school.”  “But we did not anticipate that we could nearly fill the first class without marketing the location at all.”
• Fumare comments: 1, 2
• Fumare commentary: “Monaghan Wasted His Cash“

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Ave Maria Law Fails Financial-Responsibility Test

UPDATE - The Naples Daily News picked-up this story today (June 10).

Original Article -
Today’s Chronicle of Higher Education cites a new U.S. Department of Education analysis listing Ave Maria School of Law as a private college that is “in such fragile financial condition” that it “failed the department’s financial-responsibility test” (article here, subscription required).

Only five other private schools did worse than Tom Monaghan’s AMSL on the financial-responsibility assessment.  AMSL scored “-0.9″.  The lowest possible is “-1.0″.  Image excerpt from article:

What does this mean?  According to the Chronicle, AMSL “must post letters of credit with the department equal to 10 percent of the federal aid they award, which further crimps their liquidity.”  In other words, the Department of Education is requiring a letter of credit from AMSL to help protect taxpayers on any  federal loan and grant money that might go to Ave.

Computation note from the Chronicle:
“All private colleges that award federal student aid must participate in the Department of Education’s financial-responsibility test, which is based on information from their audited financial statements. The department develops a composite score on a scale of 3.0 to minus 1.0, based on financial ratios that measure factors such as net worth, operating losses, and the relationship of assets to liabilities. Institutions with scores of 1.5 to 3 pass. In addition to extra monitoring for all institutions that “fail,” those with scores below 1.0 are required to post a letter of credit with the department equal to 10 percent of the federal student aid that goes to their students annually.”

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AveWatch Profile Updated

Due to a number of recent media requests, AveWatch updated its “About” page to include the following profile:

AveWatch Profile:

• has been continuously running since August 2006, publishing over 300 stories
  • uses a blog-type format to distribute articles, but is not a blog; AveWatch does not accept comments
  • AveWatch.org = 2006-2008 archive
  • AveWatch.com = 2008-present
• has had consistently robust viewer traffic with about 50,000 pages viewed/month and visitors from nearly every country, including Vatican City
• has been discussed on Florida and Michigan television
• has been a direct source of news and information to other journalists in national and international media outlets including:
  • PBS Television
  • European television organizations
  • National Public Radio (NPR)
  • New York Times
  • Washington Post
  • USA Today
  • New Yorker Magazine
  • various travel/business magazines
  • various Catholic diocese and publications

Contact AveWatch here.

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*Landowner-Voter Inequity May Be Worse Than Reported

“Just trust us” seems to be about as much as Ave Maria Town developers Barron Collier Co. and Tom Monaghan can muster in response to the recent Naples Daily News findings on the town’s perpetually lopsided governance.  The Colliers/Monaghan crafted and lobbied for a state law that gave them sole authority to make the Town’s decisions.  The Town’s residents are forced to pay for the decisions, and lack enough votes to ever implement their own alternative decisions.

But, the situation for the residents’ vote seems even worse than Naples Daily News reported.  NDN’s investigation appeared to place voters into two discrete classes of landowners who have a vote: developers vs.  non-developer homeowners/businesses.  But the non-developer homeowner group is actually smaller than it appears if one considers that Ave Maria University - as a direct beneficiary on the developers’ side - purchased a number of properties in Ave Maria Town.  These properties are coded by the County Appraiser as “homeowner/condominium” (Code 4).

For example, consider just the Middlebrooke area of Ave Maria Town (Ave Maria Unit 13 Lots).  There are 336 total entries for this area listed with the Appraiser’s office.  If we exclude properties categorized as “institutional”, along with anything owned by Ave Maria Development LLC, we are left with 48 properties listed as having the “homeowner/condominum” (Code 4) form of ownership:

• Pulte Homes = 9 properties
• “real people” (residents) = 7 properties
• Ave Maria University = 32 properties

So, from the Middlebrooke area alone, we can reduce the number of actual non-developer owner “resident” votes down from 48 to a mere 7.

It is striking that, for all the lip service given to the Catholic, conservative, and family values that are supposed to permeate this Town, Tom Monaghan and his real estate development partners expect Ave Maria residents to give-up their right of local self-determination to a central authority.  That model is neither Catholic nor conservative nor family-oriented.  It is supremely disingenuous of Monaghan and his team to simply tell residents to trust them… this after going to such great lengths to pass unique state  legislation to ensure that they, as developers, are never obligated to trust residents over their own business self interests.

Such distrust seems endemic to all of Tom Monaghan’s Ave Maria entities.

Related NDN articles:
+ “Ave Maria: A Town Without a Vote” (main website)
+ “Now and forever”
+ “Taxation without representation?”
+ “Developer keeping score on its ability to rule town”
+ “Residents’ control hinges on trust”

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Constitutional Crisis: A Town Without A Vote

Ave Maria School of Law co-founder Charles Rice personally warned Tom Monaghan in a October 13, 2003 letter that his south Florida real estate mega-development “Ave Maria Town” was “likely to fall in a crossfire of litigation, possibly including even criminal proceedings founded on various misrepresentations.”

With this weekend’s release of a very extensive year-long investigation into the Town’s governance structure titled “Ave Maria: A Town Without A Vote“, Naples Daily News reporter Liam Dillon put blood in the water for that litigation.  The website for the series is comprehensive, consisting of three articles, video interviews, polls, graphics, FAQs about the Town’s governance, and downloadable original documents.  Excerpt:

But Monaghan’s team and Barron Collier Cos. crafted the law’s language to give them a substantial benefit.What resulted was a government unlike any democracy residents such as Delaney [a Town resident] had ever experienced.

The law gives Monaghan and Barron Collier Cos. more power than any Florida developer in at least 24 years, power perhaps not seen since the days of the early 20th century land boom. The law makes landowners, not registered voters, the ultimate authority in Ave Maria. The law ensures Monaghan and Barron Collier Cos., as the largest landowners, can control Ave Maria’s government forever.

Excerpt:

Internal [Barron Collier] company memos from September 2003, obtained by the Daily News, show a discussion about how long Ave Maria Development should control the government. One memo called control “the major decision factor” in determining an aspect of the government’s structure.“ … we could control it in perpetuity,” wrote Tom Sansbury, a Barron Collier Cos. vice president, in the memo.

The public, Ave Maria residents and otherwise, is unaware of this arrangement. When they bought their homes, Ave Maria residents received written notice of the government’s existence and its ability to tax them. But the developer didn’t disclose how, when or if townspeople would make the government’s decisions.

Excerpt:

[A University of Florida law professor] said Ave Maria’s government could violate both state and federal constitutions that guarantee people will be governed by the basic democratic principle of one person, one vote.

“Clearly, it will be litigated,” he said. “I don’t think there’s any question about that.”

The implications are stunning and certain to catapult the extensive list of Tom Monaghan’s conflicts-of-interest into the national spotlight.  Congratulations to Liam Dillon and Naples Daily News for this work.  Be sure to read it.  AveWatch looks forward to unpacking it in the days ahead.

UPDATE:  comments at Fumare

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Donor Alert: Strategy is Costing “Mindboggling” $$ On Legal Fees

Reports from today’s Naples Daily News (NDN) are a difficult one-two punch for Tom Monaghan and Ave Maria School of Law (AMSL).  According to NDN, in the face of large institutional budget deficits and a costly relocation from Michigan to Florida, AMSL’s upcoming budget is counting on a huge increase in donations — four-times the amount that it received last year.  NDN also reported that Tom Monaghan and the Law School spent over $1 million on legal/litigation costs last year alone… an amount that one legal observer called “just hard to fathom”, concluding “It’s gotta be that money’s no limit here in fighting this one..”

No limit? Why would anyone donate to an educational organization that is burning such a large proportion of its money on outside legal/litigation fees?  According to NDN, they spent the equivalent of hiring “a $500-an-hour attorney to work more than 11 months straight, assuming a 40-hour week” ?  The court trial in the wrongful termination suit  filed against AMSL has not even started… and that is  when the real expenses will pile up for Monaghan and the School.  Click below for more…

Read the rest of this article »

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(Second) Mortgaging the Future of Ave Maria Employees

  It is an oversimplification to blame the problems of Ave Maria’s finances on the poor economy (1, 2).  In the history of Catholic education, it would be difficult to point to another enterprise that started with more colossal financial and intellectual resources at its disposal than Ave Maria.  But Tom Monaghan and his two lawyer-Presidents - Nick Healy and Bernard Dobranski - chose to gamble that mountain of resources, and the stability of their academic institutions, on a for-profit south Florida real estate development.

Now, the Catholic academic community is buzzing over the apparent financial situation that Ave Maria finds itself in under Monaghan’s business model for blending faith, higher education, and amenity-centric “active adult living”.  The AMU professor who recently painted a dire picture of the Ave Maria Foundation’s finances is now preparing to leave the institution for a Midwest Catholic university.  Over the years, AMU has had no stronger or more productive advocate for the school than this professor.  Yet, this former true believer currently has his Naples home on the market at an asking price that is over $44,000 less than his 2004 purchase price.  At least he chose to live in Naples and not Ave Maria Town.  Local AMU employees are said to be (as one resident put it) “holding their breath” about what will happen next, and what it means for their careers and families in Ave Maria Town.

AveWatch has uncovered information depicting a mountain of debt that some AMU employees may be stuck with in their decision to live and work under Monaghan, begging the question -

Is Ave Maria a victim in the economic downturn,
or more of a contributing factor?

Click below for more…

Read the rest of this article »

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Rice to Monaghan: “.. what you are doing is objectively morally wrong”

The deposition of Charles E. Rice, Esquire was taken on February 4, 2009 as part of the wrongful termination lawsuit filed by three former Ave Maria School of Law professors.  Rice is a co-founder of the Law School; he was involuntarily removed from the AMSL Board, and terminated as a Visiting Professor.  He is also a Professor Emeritus at Notre Dame Law School.  Professor Rice and his memos have been cited frequently on this website and Fumare.

The following excerpts refer to a letter from Rice to Tom Monaghan dated October 15, 2003 after a personal meeting between the two.  Click below for more…

Read the rest of this article »

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Rice: Town “..likely to fall in a crossfire of litigation..”

Some residents of Tom Monaghan’s Ave Maria Town are clearly upset with what they perceive to be “quite misleading” marketing concerning the Catholic orientation of this Monaghan-Barron Collier Company real estate project.  (See AveWatch articles: “Ave Maria Resident: Advertising is ‘quite misleading’“  and “Ave Maria Resident Calls for Resignations at AMU“)

The February 4, 2009, deposition testimony of Charles E. Rice, Esquire was taken as part of the wrongful termination lawsuit filed by three former Ave Maria School of Law professors.  Even back in 2003, Professor Rice expressed concern for the manner in which Ave Maria Town was being marketed.  Click below for deposition excerpts on this topic…

Read the rest of this article »

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*Ave Maria University group said to be “a cult”

In Fall 2004, Irish priest Fr. Colum Power arrived at Ave Maria University.  According to Power’s biography published by his order:

“In the late seventies and eighties he drifted away from the Catholic faith he grew up in, until at the age of 31, in 1996, he had a strong experience of God that dramatically changed his life.  In that same year he felt the call to the priesthood.  Seven months later he responded to that call by consecrating himself as a religious in the Servants of the Home of the Mother [HotM].  On the 20th of December 2003 he was ordained a priest.”

Notice the pattern, as we’ll return to it:

1. drifts away from faith
2. has dramatic experience and considers vocation
3. soon joins HotM

After being a priest for less than one year, Power was invited by Ave Maria University to help oversee the vocational discernment of its college students.

How does this happen?  How does an immature priest who has yet to fully embark on his own vocation get invited to participate in the incredible responsibility of vocational discernment of youth?  Further, how do the Servants of the Home of the Mother - a new “apostolic movement” that lacks canonical certification - get invited to oversee “spiritual direction, retreats, talks and holy hours as well as vocational discernment for men and women” at Ave Maria University (AMU news release; January 3, 2009)?

While it may be true that the Servants of the Home of the Mother (HotM) contribute quite positively to some aspects of the Ave Maria community, there are also some activities that are disturbing.  Individuals who have had direct contact with the HotM at Ave Maria report to AveWatch of “aggressive recruiting practices” targeted at the very young and the spiritually immature.  These practices appear to be less directed at vocational discernment and more directed toward discernment to enter HotM.  One parent, whose child joined HotM and was relocated abroad, considers the organization to be “a cult”.  A person at Ave Maria put it this way, “They pretty much work like the Communists do.  They go for the ones that are wounded, confused and lack proper Catholic formation.”

Confirmation of that tactic is borne out in HotM publications that AveWatch was able to obtain.   Click below for more…

Read the rest of this article »

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Rice Deposition: Liability Warning for Ave Maria Board

One of the perplexing aspects of covering Ave Maria is the way in which their administrators consistently seem to find it impossible to fathom that many good and decent people - not just a few “terrorists” on a “smear campaign” - have arrived at the same sad conclusion concerning their management.  The fact that Law School co-founder Charles Rice and entrepreneur Vic Melfa currently find themselves apart from any Ave Maria board is likely related to the deep mutual respect that the two share for each other as “men of great integrity”.

This AveWatch post is specifically directed toward current Ave Maria Board members; it is an effort to help them formulate better questions on their personal liability as a volunteer director of a non-profit corporation.  The article draws heavily from the deposition of Charles E. Rice, Esquire taken on February 4, 2009 as part of the wrongful termination suit filed by three Ave Maria School of Law professors.  To succinctly quote Professor Rice:

“Hey, [..] you guys, unless you’re crazy, you better think about this, because your liability for gross negligence cannot be [..] taken care of by the corporation.”

Over the years, AveWatch has (unintentionally) become something of an unofficial ombudsman across all the Ave Maria entities.  Dissatisfaction and unrest among constituents and stakeholders - including residents of Ave Maria Town - has never been higher in our estimation.  The Ave Maria boards would do well not to ignore it.

Click below for excerpts from Professor Rice’s deposition of February 2009.  The selections are not only applicable to AMSL, but also to AMU and the Town’s residents, particularly with regard to the Barron Collier Company’s ability to acquire the University’s interest/assets in the Monaghan partnership.  Readers will also find of interest comments from Fr. Michael Scanlan (Franciscan University of Steubenville) to Rice.

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Rice: Law School Engaged in “Fraudulent Misrepresentation”

Last week, AveWatch cited a stunning January 2009 memo authored by a current Ave Maria University faculty member.  After viewing internal financial information, the professor raised serious questions about the stability and integrity of the institution and Tom Monaghan’s Ave Maria Foundation (excerpt):

“If I recall correctly, the Foundation shed a lot of money last year, and now is down to a total of $33 million, almost as much as it spent last year.  The natural question, then, is what happens if the Foundation – what with moving the law school to FL plus the regular AMU expenses – is down to $8-10 million by the end of this budget year.  To put it another way and thereby clearly state my first question: How much money can we anticipate the Foundation to have at the end of this budget year?”

If the assets/liquidity of Tom Monaghan’s Ave Maria Foundation are in question for AMU, it follows that they are also in question for Ave Maria School of Law.  The implications are enormous for AMSL as it abandons its Ann Arbor campus for space owned by AMU in Naples, Florida.  AveWatch recently put the following to Robert Falls (Ave Maria’s media contact) but received no answer:  “What was the date that the American Bar Association was last given updated information on the financial assets of Ave Maria School of Law and AMF?”

The February 2009 deposition testimony of AMSL co-founder Charles Rice (Professor Emeritus, Notre Dame Law School) calls into question whether Ave Maria was fully transparent with American Bar Association (ABA) evaluators on the topic of Tom Monaghan’s commitment to fully fund AMSL.  Recall the following from Monaghan’s February 2008 deposition testimony:

Q: “Did the foundation take a position with the ABA as to its support of Ave Maria School of Law?”
TM: “I don’t believe I made any commitments.”
Q: “Did you take a position with the ABA as to the kind of funding you would be prepared to continue to provide with the ABA?”
TM: “I did not — I don’t believe I made any type of commitment to the ABA regarding funding.”

See also “Monaghan Dep #5: Nondisclosure to ABA”

Based on this, one wonders how transparent AMSL was about AMF finances, and Tom Monaghan’s lack of financial commitment, during the subsequent ABA acquiescence on the Florida move.  Click below for Rice’s deposition testimony…

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Ave Maria Resident: Advertising is “quite misleading”

“People have a right to be shown the full picture before moving here.”

That is one of the issues driving Ave Maria Town resident Marielena Montesino de Stuart to publicly engage university administrators and town developers.  Ms. de Stuart’s latest response to AMU President Nick Healy sets the public straight on, among other things, Healy’s ongoing tensions with the Diocese of Venice:

Yes, it is true that the Administrator (Pastor) assigned by Bishop Dewane has brought back the communion rails that had disappeared under the control of AMU’s administration; however, well after the Oratory was under the pastoral care of the Bishop, our Parish Administrator had to issue a strong statement protecting a communicant’s right to access the communion rail, due to complaints from students and residents who were being denied their right to kneel.

While the Naples Daily News carried a truncated version of Ms. de Stuart’s latest response, AveWatch is pleased to run her full editorial.  Click below for more.

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*Memo Challenges Ave Maria Finances/Ethics

A recent article in Naples Daily News quoted Ave Maria University President Nicholas Healy on the state of the University’s finances:

“We’re not overextended,” he said. “We have grown prudently.”  He took issue with [a Board member’s] statement that the university relies too heavily on town real estate.  “The real estate has always been a major prospective endowment for us, but we have never counted on the real estate for our operations,” he said.

While it may be true that AMU has not relied on profits generated from the sale of real estate in Ave Maria Town to date, Healy is skirting the important question:

Are the realized profits from sales such that AMU has - right now, in its own bank account - sufficient financial assets/liquidity to operate all of its current majors, with all of its current faculty, staff, and facilities, for 4 years?

A January 2009 memo raises concerns about Ave Maria’s ability, and willingness, to answer that question.  The memo was attributed to a faculty member currently at Ave Maria University.  Excerpts:

Without this [proposed] audit and demonstration of liquid assets, I fear that all of us (to different degrees) are participating in something that we may later deeply regret, namely selling to young people and their families a 4-year educational product that we do not have sufficient reason to believe can be delivered.

We have reason to believe that the resources of the Foundation may not last much more than one or two years.

Important note:  Despite our repeated attempts, officials at Ave Maria University declined to confirm or comment upon the content of this memo for AveWatch.  Readers should take this into consideration when evaluating the merits of the memo.  We do know that (a) the memo was circulated to all AMU board members and (b) according to non-administrators at Ave Maria, the content of the memo is said to agree with “many other faculty and staff” at AMU.  AveWatch does not disparage anyone’s motives at AMU, including the administrators.  Nothing in this article or anywhere on this website questions the commitment of all involved to what they genuinely see as the best interests of Ave Maria.  AveWatch fully concedes this.

The memo explicitly and implicitly raises many questions:

• Why has it taken Ave Maria so long to address the issues documented in the memo, given the memo’s existence since January?
• If the Ave Maria Foundation is rapidly losing money, who is aware of it at Ave Maria School of Law?  Has the Board been informed?  Would an updated description of the Ave Maria Foundation’s financial state influence accreditation/acquiescence with the ABA?  Is it prudent for AMSL to move from its established campus in Ann Arbor to buildings in need of renovation in Naples this summer? (Today is the ribbon-cutting on that renovation.)
• If AMU’s financial future is such that faculty are worried about having degrees/positions cut, how can Tom Monaghan justify the recent hiring of a Hungarian sculptor to live at Ave Maria into 2010 to make the world’s largest Virgin Mary out of premium Italian marble? Photo from the live “sculpture cam”:
  
• Is AMU still willing to field a competitive sports program, with scholarships, if it means selling land at a loss, or trimming jobs and academic programs?
• How can the AMU Board justify the transfer of a $3 million University donation from AMU to a wholly separate non-profit entity (the local grammar school) given the University’s own economic circumstances?  Did the AMU Board vote, as a group, to explicitly authorize Tom Monaghan to approach this AMU donor about reallocating his gift from AMU to the grammar school?
• How does this situation impact the Diocese of Venice?  Has Bishop Dewane been adequately appraised?  Will the Diocese be asked to cover the operating expenses of the oratory?

Click below to read the memo.
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Healy: Ave Maria Town “intended” as “a mixture of faiths”

In response to “Ave Maria Resident Calls for Resignations at AMU“, Ave Maria University President Nicholas Healy filed the following in this morning’s Guest Commentary at Naples Daily News:

“Ave Maria embraces mixture of faiths, worship styles”
by AMU President Nicholas Healy
Feb. 28, 2009
Excerpt:

The town of Ave Maria was never intended to be an exclusive “orthodox Catholic environment” that a handful of people have demanded. Rather, it was intended — and thankfully is — a mixture of faiths. Among the Catholic residents, there is a mixture of spiritualities and differing liturgical preferences.

One cannot, however, credibly argue that Ave Maria Town was never heavily promoted as a place for orthodox Catholics.  Tom Monaghan clearly intended to turn “Ave Maria” into a lifestyle brand - and not just a Catholic lifestyle, but a particular kind of Catholic style [1  ,2, 3].  Even conservative columnist Brent Bozell bought Monaghan’s marketing pitch (3/8/2006) - “After facing zoning problems with his first location in Michigan, Monaghan struck a deal in southern Florida, not to merely build a Catholic college, but a truly Catholic town, open to anyone aspiring to live in communion with traditional values.”

(Click below for more…)

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Resigned Trustee Critical of University Leadership

In a follow-up to last week’s article “Ave Maria University Trustee Departure is ‘Mystery‘”, former board member Vic Melfa issued a press release yesterday.  Naples Daily News was granted an interview with Melfa, and the story ran in today’s edition - “Former Ave Maria board member critical of university leadership“.  Excerpts:

Melfa also expressed worry about Ave Maria’s financial situation, citing the five-year-old school’s newness, high growth and reliance on Ave Maria town real estate.

More than five years ago, Ave Maria University founder and chancellor Tom Monaghan invested more than $50 million to develop half of the 5,000-acre town surrounding the school with the return planned for the university’s endowment. Monaghan also began the school with an additional $250 million donation, all made possible by his Domino’s Pizza fortune.

“Since (Ave Maria’s) non-student income is very dependent on the town’s real estate venture and Tom Monaghan’s donation, it is in a more precarious position than most other schools,” Melfa said.

Another issue, Melfa said, is the school’s relationship with the Catholic Diocese of Venice and Bishop Frank Dewane.

Ave Maria is independent of the diocese, and needs formal approval to call itself a “Catholic university,” as per church law.

Melfa addressed the recent removal of the words “Ex Corde Ecclesiae” from the logo of Ave Maria’s K-12 private school and the removal of the phrase “Catholic university” from areas of the university’s Web site.

The change in the grammar school’s K-12 logo occurred when Tom Monaghan shifted donor money from AMU to the school; see the logo in the AveWatch article Monaghan Priorities: Operating Expenses or Guinness Book?  Concerns about the University’s relationship with Bishop Dewane are summarized in this series of AveWatch articles (alternatively, read “Quasi-Status: Good Medicine from Bishop Dewane“)

Melfa’s concern for AMU’s financial stability is consistent with internal rumblings at the University.  AMU President Nick Healy, however, brushed the concern aside according to the newspaper.  Excerpts:

“We’re not overextended,” he said. “We have grown prudently.”

He took issue with Melfa’s statement that the university relies too heavily on town real estate.

“The real estate has always been a major prospective endowment for us, but we have never counted on the real estate for our operations,” he said.

AveWatch will return to Healy’s description of AMU’s financial stability in a forthcoming article.

Click below to read Melfa’s statement.

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Monaghan on Board Bylaws: “I don’t know, I’m not a lawyer.”

A brief overview of the Katherine Ernsting whistleblower case against Ave Maria College can be found here.

Using excerpts from Tom Monaghan’s deposition on October 16, 2008, AveWatch explores three sets of questions:

1. Did Tom Monaghan, in the absence of explicit instructions from the College board, have the authority (per the bylaws) to direct College President Ronald Muller to rescind employee contract extensions/adjustments that were issued by Muller weeks earlier?
2. What did Tom Monaghan intend to convey to College board members in a memo sent just four days before a June 2004 meeting by “indicating that if the board does not agree [with his plan], there will be most serious consequences”?
3. Who directed Muller to rescind the June 2004 College employee contracts apart from the College board?  Monaghan contends that it was Ave Maria Foundation CFO Paul Roney.  Muller, in his deposition, contends that it was Monaghan.  Was there even a written plan?

Monaghan’s deposition testimony provides additional insight on the kind of control that he exerted over the entities for which he served as both primary donor and board chairman.  (Click below for more…)

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“I don’t wanna hear all this bad stuff”, Part I: Orsi on Maciel

   Ave Maria School of Law Chaplain Fr. Michael Orsi is back on the radio, this time on a station that will allow him to be heard in both Detroit and Naples, Florida.  According to AMSL, Orsi will have his own studio in Florida, and will work toward “a daily morning broadcast live from the School”.  Get ready south Florida and Diocese of Venice; you’ll be able to hear lots more stuff like the following from Tom Monaghan’s perpetually “agitated” priest (links go to story and audio):
- on sexual molestation
- on immigration
- on the sexual accountability of minors
- on discrimination
- on immodest dress and rape

In his February 7, 2009 radio program, Orsi shared his opinion of the perverted double-life led by Fr. Marcial Maciel, founder of the Legionaires (Regnum Christi).  We have an MP3 of those comments.  We will also draw parallels between those comments and the deposition testimony provided by Ave Maria School of Law Board member Kate O’Beirne on the “BoysCherries” gay pornography incident.  (Click below for more…)

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Monaghan Priorities: Operating Expenses or Guinness Book?

Around the country, a top priority for every campus planner is a first class student recreation facility.  Why? - because it is a high priority for most prospective students.  Even in difficult economic times, schools are continuing to deliver on their rec center plans (example).  Ave Maria University has been advertising its Donahue Student Recreation Center to prospective students since at least Fall 2007 (NDN, 2/4/09).  The following is from AMU’s website earlier this month (February 16, 2009):

Jack Donahue, a Trustee of Ave Maria University since 2002, gave a $5 million donation for the building.   But today, here is how AMU represents the Center, without Donahue’s name:

Q: How did the building lose Donahue’s name?  A: The project lost his $5 million.  Q:  How did that happen?  A:  The explanation is rooted in what appears to be deep financial problems within Tom Monaghan’s Ave Maria empire.  His solution to that problem is yet another example of the deeply conflicted interests that exist between the non-profit entities that he manages.  (Click below for the explanation…)
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Ave Maria University Trustee Departure is “Mystery”

On January 30, 2009, a press release announced that Massachusetts outsourcing businessman Victor Melfa was the latest addition to the Ave Maria University Board of Trustees.   AveWatch server logs indicate that, in early February, one or more individuals from Melfa’s company reviewed the website.  Today, on February 19, Naples Daily News reports that Melfa “left the board under mysterious circumstances Thursday following a morning session”.  Excerpt from “Mystery surrounds Ave Maria Board member’s exit“:

Asked whether Melfa resigned or was removed, Holman [another Board member] replied, “That’s still to be decided.”

“I have no comment on that,” Melfa said. “I hope to be able to talk to you more openly and frankly in the future.”

“I plan on speaking further to the press in the near future about things and what I’m going to do,” he said.

Melfa’s name was removed from the university’s Web site by 4 p.m.

Apparently, AMU did not see fit to leave Melfa’s name on their website “for recruiting purposes“, unlike inactive members of the school’s basketball program.

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Ave Maria Resident Calls for Resignations at AMU

Yesterday’s Naples Daily News carried a strongly worded guest column by a traditional  Catholic who moved with her family to Tom Monaghan’s Ave Maria, Florida in August 2007 on the “advertised presence of an ‘orthodox Catholic’ university”.

“Guest commentary: Open letter to board of trustees of Ave Maria University”
Naples Daily News; February 17, 2009
Excerpts:

Need I say that nothing, absolutely nothing could have prepared me for the division and defiance I witnessed against our Bishop, nor for the persecution I suffer as an orthodox Catholic, to this day, inside Ave Maria. What a profound disappointment it has been, to my family, and to others– who are interested in being loyal to the Church, and were attracted to Ave Maria by AMU’s marketing to “orthodox” Catholics.

Why doesn’t the administration of AMU openly advertise its well known stubborn bias for the Charismatic Movement and the “Praise & Worship” Mass, and its dislike of Sacred Music and the Extraordinary Form (Latin Mass)? Is it merely to entice traditional and orthodox students (and residents) to AMU and to the Town of Ave Maria?

In light of the serious issues and questions presented above, as well as in consideration to the faculty, current and prospective students, parents, residents, donors and benefactors, it is incumbent upon the Board of Trustees to take the necessary steps to begin the process of requesting the resignation of the current administration at Ave Maria University, and to seek a new leadership…

AveWatch predicted these tensions back in December 2007:
“Liturgical Meltdown Ahead?”

Related articles from the AveWatch article archive:

• Cashing-in on the Blessed Virgin Mary
• From Logo to Tabernacle: Cashing-in on the Holy Eucharist
• Monaghan Can’t “Out Orthodox” Bishop Dewane
• all articles about the oratory and liturgical issues

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Monaghan Cites “Smear Campaign” at Florida Law Event

On August 27, 2007, both on the radio and at the opening ceremony for Ave Maria University (Florida), Tom Monaghan saw fit to call his former Ave Maria College (Michigan) employees “academic terrorists“.  That statement raised the ire of former staff (see “Canon Lawyer Calls Monaghan to Task“) and is now proving to be a problem in the lawsuits filed against Monaghan - cases in which he contends that public criticism of Ave Maria is not grounds for termination.

Yesterday, Monaghan took the opportunity to again show his managerial thin-skin during a Naples event to recognize the American Bar Association’s acceptance of Ave Maria School of Law’s plan to move to Naples.  Excerpt from today’s Naples Daily News:

“It’s proved incredibly difficult,” he said. “There were some faculty members who really dug in their heels and resisted the move, in addition to waging a smear-campaign in the media.”

Monaghan cannot seem to comprehend that the AMSL faculty’s stated objection was to his dysfunctional management, with Florida being one of many symptoms that could be pointed to.  If Monaghan believes that any public statement criticizing his management is akin to “waging a smear-campaign in the media”, then it questions the credibility of his contention that such statements are not grounds for termination.  Who, as a board chairman, would not seek to fire a “terrorist” employee, if that really was the chairman’s  perception of the employee?

UPDATE - Commentary on Fumare

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Whistleblower Press Release

Press Release
Whistleblower case against Ave Maria moves forward

Feb. 17, 2009
Contacts:
Joseph Golden 248 398-9800  (Regina Bell)
Kate Ernsting  734 645-9046
Email:  rbell@pittlawpc.com

Judge rules Whistleblower lawsuit against Monaghan’s Ave Maria College should go to trial 

ANN ARBOR (Feb. 16, 2009) – A whistleblower lawsuit against Ave Maria College and the Ave Maria Foundation is finally set for trial five and a half years since former Director of Financial Aid Kate Ernsting was fired from her job on July 2, 2004 for reporting illegal activity to the Department of Education. The college has closed its doors in Michigan.

On Friday (Feb. 13) Washtenaw County Circuit Court Judge Timothy Connors dismissed Ave Maria’s request for summary dismissal, paving the way for trial, probably in May.

“I’m happy to get out this case on track,” said Ernsting, who is now employed at the University of Michigan. “For years this case was hung up in legal limbo and now I really look forward to a trial where the facts will be laid out and justice will finally be served.”

“This has been a long and grueling ordeal for my client and we are glad to finally be able take the case to a jury,” Ernsting’s attorney Joseph Golden, of Royal Oak, Mich. firm Pitt, McGehee Palmer, Rivers & Golden, said.  “In his ruling on Friday Judge Connors noted that there are issues of fact that must be decided by a jury. We are confident of a victory and restitution for the severe damage Kate has endured.”

“Judge Connors on Friday indicated that a reasonable jury could find the reason given for the termination was pre-textual, which means that reasonable people could challenge the explanation given by Tom Monaghan and others as to why Kate lost her job at this time,” Golden added. Monaghan, founder of Domino’s Pizza in Ann Arbor, is also the founder of Ave Maria College and was chairman of its board of trustees when Ernsting was fired.

Ernsting filed the lawsuit in Sept. 2004, claiming that she was fired from her position as financial aid director of Ave Maria College in Ypsilanti because she had reported illegal activity on the part of her superiors to the federal Department of Education and to the State of Florida.

Only days before she was fired, the DOE announced that AMC had indeed violated the law in regards to the federal tuition program and would have to repay funds illegally disbursed. Three months later the DOE ordered the college to pay back $259,620 in tuition aid AMC was not “legally authorized to disburse.” This penalty came after Ernsting discovered and reported that the college’s license with the State of Florida for its course site in Naples had been cancelled by an AMU official. The college and university were also cited because the two institutions were under joint control, but only the Michigan college was authorized to award federal aid.  Both of these illegal acts were reported to the DOE by Ernsting.

“The core of my case is that I was the victim of retaliation and I was ordered not to talk to the Department of Education and the Inspector General. However, part of my job description required that I inform the DOE of any illegalities,” Ernsting said.  “There is no question that I was fired for reporting this and we have a small mountain of documentation to substantiate my case.”

AMC officials have denied that they fired Ernsting for reporting to the DOE, but said her abrupt dismissal was due to a June 28 decision by the Board of Trustee to “wind-down” the college, since a new university, also named Ave Maria, was being founded in Naples, Fla. They also have claimed that Ernsting could have been rehired to work in a different job at the school if she so desired.

However, former AMC President Ron Muller testified in a November 2008 deposition that Ernsting was not rehired due to a hostile attitude against her held by top officials in the Ave Maria organization.

Ernsting’s case was originally dismissed by Judge Connors, who claimed her situation was not covered by the Michigan Whistleblower Act because the DOE was not a law enforcement agency. Ernsting appealed his ruling, and won in the Michigan Court of Appeals. Ave Maria, however appealed that ruling to the Michigan Supreme Court, which upheld Ernsting’s stance in Dec. 2007.

- END of PRESS RELEASE -

Related AveWatch Article:
Whistleblower: Healy Dropped College One Day After Feds Contacted

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Whistleblower: Healy Dropped College One Day After Feds Contacted

A brief overview of the Katherine Ernsting whistleblower case against Ave Maria College can be found here.

The following are excerpts from the February 9, 2009 “Brief in Opposition to Defendent’s Motion for Summary Disposition and Proof of Service” written by Ernsting’s legal team (full text PDF).  This Brief convinced Judge Timothy Connors to allow the case to proceed to a trial by jury.   AveWatch comments are in square brackets.

[Did Ernsting engage in activity protected by the Whistleblower’s Act?]

Abdalla [an AMC employee] spoke to the DOE only about one issue and only had one contact. That information regarding the miscoding of eleven students was resolved without any fines or penalties assessed to the Defendant. However, Plaintiff reported many other irregularities and illegalities to the DOE and its Inspector General  which were not part of Abdalla’s limited report. Plaintiff, not Abdalla, told the DOE that Defendant had closed its license for operating in Florida, that the campus lacked academic supervision, that Defendant was improperly trying to transfer assets and that two institutions, AMC and AMU improperly had common board membership. The DOE was not on notice of these matters based on anything learned from Abdalla. Therefore Plaintiff was a whistleblower with regard to these reports of suspected illegal activity.

Further while Plaintiff stated that initially her reports to the DOE were intended to protect Robert Muller, AMC’s President and her boss, she continued to provide reports of suspected violations to remedy the situation and bring the Defendant in compliance with the law. In fact, she continued to report to the DOE even after she was removed from the financial aid position and Muller told her to stop talking to the DOE. She was trying to stop the illegal activities by the Defendant.

[Was there a causal connection between reporting to the DOE and the firing?]

Many witnesses testified to the anger and hostility expressed by members of the Defendant’s executive committee toward those employees who reported illegal conduct to the DOE. Muller, Abdalla and Herbel all heard Nick Healy, Jack Stiles, Father Fessio, Paul Roney and Tom Monaghan express  their anger toward the whistleblowers and  threaten that they would be out of a job. The terminations then occurred with [sic] a week of Defendant receiving notice that it would have to make a substantial payment to the DOE for improperly obtaining financial aid for students attending a school lacking a license.

Muller and Garcia made Plaintiff aware that the Executive Committee  were well aware of Plaintiff’s many reports to the DOE and their animosity toward her for those activities.

This animosity has been established by many witnesses. Healy himself issued [sic] memo disparaging those individuals who reported to the DOE. Muller shared with Herbel, McNally, Plaintiff and Abdalla that the Florida group which included Monaghan, Healy, Father Fessio and Roney all felt that the whistleblowers [sic] be fired.

Moreover, the evidence is clear that Defendant did not intend to shut down the [AMC] departments which were allegedly eliminated on June 28, 2004 until the whistleblowing activity of the Plaintiff and others. On February 17, 2004 the Board resolved to allow AMC administration to plan a Michigan continuation college. Notably, support for a continued presence in Michigan was only withdrawn by Nick Healy on May 12, 2004 – one day after Plaintiff and other whistleblowers issued a lengthy report to the DOE. (Exh 28).

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Whistleblower’s “Claim is Legally and Factually Supported”

Tom Monaghan’s “bleed ‘em to death in court” strategy of justice was dealt a severe blow this week.  The Whistleblower lawsuit of Ernsting v. Ave Maria College can now proceed to a trial by jury.  Finally.

Background: In 2004, the federal Department of Education forced Ave Maria officials to pay back $259,000 in financial aid that was illegally distributed to students on the Florida campus who were registered at Ave Maria College in Michigan.  At the time, Katherine Ernsting was the director of financial aid; she had a legal obligation, as part of her position, to cooperate with the federal government in documenting  how Ave Maria used taxpayer funds.  But Ernsting was fired by Ave Maria College in July 2004 and a new financial aid director was named.  [Naples Daily News excerpt:]

“The administration asked me to stop talking to the Department of Education, but I couldn’t do that,” she said.  “They threatened my job if the outcome of the investigation didn’t come out right.”

After Ernsting filed suit, Tom Monaghan’s legal team tried everything to deny Ernsting her day in court.  When asked about the merits of Ernsting’s case, Ave Maria lawyer Paul Fransway was quoted as saying “We hope we don’t get to that point” (NDN, 3/24/07). Ave Maria argued that the Michigan Whistleblower’s Act - which protects employees from employer retaliation for helping law enforcement - did not apply to Ernsting because federal investigators from the Inspector General’s Office who work in the Department of Education are not “law enforcement” (even though these investigators have the authority to carry firearms and arrest individuals).  Ave Maria took Ernsting to the bank with their persistent claim about the Whistleblower’s Act… all the way to the Michigan Supreme Court, which garnered the attention of legal newspapers. In December 2007, over 2.5 years after the filing of her suit, the Michigan Supreme Court ruled in Ernsting’s favor.

But Tom Monaghan’s legal team persisted in trying to deny Ernsting the ability to have the merits of her case heard.  Ave Maria filed a motion for summary disposition in Washtenaw County Circuit Court.  Earlier this week, judge Timothy P. Connors rejected Ave Maria’s motion, thereby allowing Ernsting to finally have her case heard by a jury without any more obstruction [excerpt from the “Brief in Opposition to Defendent’s Motion for Summary Disposition and Proof of Service”, Feb. 9, 2009]:

“Defendant now brings a motion for summary disposition pursuant to MCR 2.116 (C)(10) alleging that Plaintiff cannot establish a prima facie case because she was not a whistleblower and that she cannot demonstrate a causal link between her protected activity and her termination. A detailed review of the complete record and the applicable law, however, demonstrates that Plaintiff’s claim is legally and factually supported. Therefore, Defendant’s motion should be denied in its entirety.”

Ave Maria lawyers have repeatedly claimed that Ernsting’s dismissal was merely part of the Michigan campus “wind down” as operations started in Florida.  But many points reject that claim:

• It is a federal requirement that campuses have a director of financial aid to help oversee government aid distribution.  So, it was not possible to terminate Ernsting’s position, particularly since Ave Maria College still had approximately 200 students at the time of her termination.
• Ernsting was denied employment for other open positions at the College.
• Despite indicating her intention and desire to do so, Ernsting was not transferred to the Florida campus where operations and hiring were ramping up.
• Ernsting received notice of a salary increase on June 17, 2004.  AMC President Ronald Muller indicated in his deposition that he fully intended to employ Ernsting for the 2004-5 academic year, which begins July 1.  On July 2, 2004, Ernsting was terminated.
• From the Brief in Opposition this week: “AMC was not in wind-down mode. The school was to continue to function as AMC until accreditation was obtained for AMU and students could graduate. The school was given $25 million to continue through 2007 (Ernsting dep (10/08) p 105). The plan was to stay open until 2007 and until that point, the college was going to be admitting students and maintaining a degree program. (Id, p 106).”

It looks bad for Monaghan.  Much more is forthcoming from this and other compelling documents in the case.

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