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Former LCO Clinic Director files lawsuit

By Joe Morey

News Editor

The former Lac Courte Oreilles Health Center Director who was terminated on Sep. 9, 2019, by a split Tribal Governing Board (TGB) has filed suit in LCO Tribal Court over her termination. The court will heard the complaint on Thursday, Dec. 19, but has been delayed since due to the Covid-19 pandemic.

Sarah Cormell alleges in a lawsuit against the TGB that her termination was a breach of contract, defamation of character, wrongful termination and harassment by the TGB.

As part of her suit, Cormell said the breach of contract exists because she wasn’t provided a 30-day notice of her termination per her contract, or given a lump sum equal to 3-months of pay as required within 30 days of her termination, and the TGB failed to provide supporting evidence for a termination “with cause” in violation of her employment contract.

In a TGB meeting on Sep. 16, the four members of the TGB who moved to terminate Cormell stated she hired someone who they had instructed her not to hire, and they also stated they had been receiving a lot of patient complaints about her. A third reason they terminated Cormell included her employing Dr. Rey Palop, who they claimed couldn’t see patients who are billed through Medicaid over a case from 2006.

The lawsuit alleges the four members of the TGB who moved to unlawfully terminate Cormell included LCO Vice Chairwoman Lorraine Gouge, Sec-Treasurer Michelle Beaudin, Glenda Barber and Gary “Little Guy” Clause.

In the lawsuit, Cormell said the four TGB members defamed her character by posting a letter on the Facebook Group Forum, Lac Courte Oreilles Today, which had “myriad false allegations about Cormell that denigrated Cormell’s moral and professional conduct while Health Director/CEO of the Health Center specifically that she violated HIPAA which effectively “blacklists” Cormell from future employment in the field of health care.

“Specific emails were authored by Beaudin, Christine Kuykendall and Marsha Pringle and evidence their involvement in the defamatory Facebook post,” the complaint stated.

As a result of the Facebook letter, Cormell claims her reputation and standing in the community has been damaged and that many of her social and professional peers have read the letter.

In that letter, as part of their reason for terminating Cormell, it is claimed that Cormell hired Dr. Rey Palop despite his being accused of over-prescribing medications, which led to him being unable to bill for Medicaid or Medicare. The letter states that in the past the Tribe had to remove a doctor for over-prescribing which led to an opioid addiction crisis on the Reservation which the Tribe is still dealing with today. The letter stated Cormell dismissed two qualified physicians and replaced them with Palop. The letter stated TGB would have done a background check prior to hiring Palop.

Cormell’s lawsuit also alleges the four members of the TGB have repeatedly harassed her based upon her membership in another tribe.

“On or about July 30, 2019 in a TGB meeting Beaudin, Barber, Clause and Gouge made comment to the effect that Cormell was not a member of the LCO Tribe with the implication that it was a detriment to management of the Health Center,” the complaint stated. “Beaudin, Barber, Clause and Gouge refer publicly to themselves as the ‘Coalition for Change’ whose goals include removing non-member employees from positions with LCO and replacing them with LCO tribal members. This campaign is being employed in the workforce, including the Health Center, to intimidate non-members of LCO and non-native employees.”

Cormell stated she suffered extreme stress and emotional suffering as a result of the hostile work environment created by constant attacks from Barber and Beaudin.

The complaint stated that prior to Cormell being hired, the Health Center had contracted with a third party to do an audit of Health Center finances and identify any errors or potential issues in practice and reporting, and on July 12, 2019, the Tribe’s newspaper printed a story concerning those findings implicating accounting discrepancies linked to Beaudin and her employment at the Health Center.

The complaint further states that Beaudin and Barber alleged that Cormell was the source for the article in the LCO Newspaper and that she divulged confidential information to the reporter. They also allege that Cormell made false accusations of Beaudin on a radio interview on WOJB. The subject of that interview was the Health Center finances.

“Cormell denied being the source for the article. Cormell explained to Beaudin and Barber that in her capacity as Health Director her duties include consulting with the TGB and the Health Board regarding the findings of the audit, any information shared by those Cormell reported is beyond her control,” the complaint notes.

Cormell also told Beaudin and Barber that no confidential information was shared on the radio interview.

The complaint further explains the hiring of Diane Peterson as a consultant to complete delinquent Federal Qualified Health Center (FQHC) reports from the previous five years. The reports are to be submitted annually and if no reports are filed for five years, enhanced reimbursement for Medicaid and Medicare benefits to the Health Center are no longer available. The complaint states that the average FQHC reimbursement to the clinic ranges from $800,000 to $1,500,000.

On July 12, Beaudin and Barber instructed Cormell to terminate Peterson. In the Facebook letter, it alleges that Cormell continued to employ Peterson through the month of August against what she was instructed to do.

“Before hiring Peterson, Cormell consulted with TGB and LCO’s legal department because Peterson was considered a transfer from another LCO agency. TGB and the LCO legal team did not object to Cormell hiring Peterson,” the complaint stated.

Cormell said when she was instructed to terminate Peterson. She didn’t know whether a quorum vote had been taken by the TGB.

The complaint goes on to describe several other areas of wrongful termination including Beaudin and Barber alleging that Cormell was not following tribal member hiring preferences, although Cormell stated she hired 14 tribal members out of 26 new hires during her tenure. She said almost all new hires were tribal members unless certain credentialing was required.

In the Facebook letter, it states the four new council members were elected on a “Tribal Members first” platform which included all areas of service, care and jobs. The letter states they were elected to make decisions for the benefit of the membership and by doing so, they will make sure tribal members are hired first according to the Tribe’s tribal preference hiring policy.

The lawsuit also addresses a petition that was gathered containing the signatures of over a required 100 tribal members presented to the TGB on Monday, Oct. 7, by Ramona Ingerson, a member of the LCO Elder Advisory Council. The petition asked for a referendum vote of the tribal membership to reverse the official action of the TGB to terminate Cormell.

The petition was organized under the Tribal Referendum Code established by the TGB under the Lac Courte Oreilles Tribal Constitution, which states a referendum requires at least 100 signatures and at least 200 registered tribal members to vote in said referendum. According to the Referendum Code, the Petition needed to be accepted by the TGB within 60 days of receipt and a Referendum vote is to take place within 90 days of receipt.

Once the petition was confirmed by the LCO Enrollment Office, the four members of the TGB named in the lawsuit denied recognition of the petition. The complaint states the same quorum that voted to terminate Cormell voted to not submit the valid petition to the Election Committee for Referendum.

In the meeting on Nov. 4, the four members of the TGB cited their belief the petition process under Tribal Code of Law didn’t pertain to this specific case. They stated at the TGB meeting this case was a termination of an employee rather than a TGB enactment of any tribal law, statute or code.

“She should have to go through the Appeals process like any other tribal employee,” stated Glenda Barber, TGB member.

Cormell’s complaint stated, “The role of the TGB under the Referendum code is only to determine the validity of the petition. The TGB has no discretion to reject a valid referendum petition. The power to call for a referendum vote is with the people of LCO, and under the code once the petition is found valid a referendum vote shall occur within 90 days of submission of the petition.”


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