10/24/2017 4:33:20 PM 17CV46621 IN THE CIRCUIT COURT OF THE STATE OF OREGON FOR MULTNOMAH COUNTY ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

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1 // :: PM CV MARY MACY, an individual, Plaintiff, vs. IN THE CIRCUIT COURT OF THE STATE OF OREGON MICHAEL J. HANLEY, the Bishop of the Diocese of Oregon, PROTESTANT EPISCOPAL BISHOP OF OREGON (CORPORATION SOLE, an individual and Corporate Sole, and THE DIOCESE OF OREGON, an Oregon nonprofit corporation, Defendants. FOR MULTNOMAH COUNTY Case No.: COMPLAINT (Whistleblower Retaliation ORS A. and ORS A.00(1(f; Aiding and Abetting in Retaliation ORS A.00(1(g; Wrongful Discharge NOT SUBJECT TO MANDATORY ARBITRATION JURY TRIAL REQUESTED PRAYER: $, (ORS.0(1(c 1. (Introduction Plaintiff is the former Finance Officer of the Episcopal Diocese of Oregon. As part of her job duties, she was appointed Treasurer of a religious non-profit corporation, the Episcopal Bishop of Oregon Foundation, that managed over ten million dollars of assets mostly donated by the grandmother of current Portland mayor, Ted Wheeler. These assets were earmarked for specific purposes associated with Chaplin at Legacy Good Samaritan Hospital, only. In and, Plaintiff reported that Bishop Hanley was misappropriating these funds for general use by the Church. Plaintiff also reported Bishop Hanley s physical assault of an Episcopal reverend, sex discrimination, age discrimination and other activities of Bishop Hanley that violated IRS 1 Complaint SW Morrison St, Suite Telephone: (0 -

2 1 1 regulations, including his practice of accepting tax deductible donations for acceptance in the exclusive Arlington Club. In retaliation for her opposition of these bad faith, illegal and, in some cases, fraudulent acts, Plaintiff s employment was terminated. Plaintiff brings this claim for damages against Defendant, and further seeks an Order requiring the funds misappropriated from the Episcopal Bishop of Oregon Foundation be returned to the Foundation.. Plaintiff Mary Macy ( Plaintiff is a resident of Oregon who, at all material times, worked for Defendants as the Finance Officer of the Diocese of Oregon from on or about September, 0 through on or about October,.. Defendant Diocese of Oregon ( Diocese of Oregon is a non-profit corporation that operates the Episcopal Church in Western Oregon. It has a principal place of business at 0 SW Military Lane, Portland, Oregon in the County of Multnomah. The corporation holds in trust all property given for objects connected with the Episcopal Church in the Diocese other than property held by parochial or other corporations. Bishop Hanley, President, of the Diocese of Oregon, the Officers and the Board of Trustees administer the funds held by the Diocese of Oregon.. The Protestant Episcopal Bishop of Oregon, Corporation Sole constitutes and is represented by Bishop Michael Hanley, President, and any successors in office, in perpetuity. This entity is a depository of funds and property held for the benefit of Church. The funds are administered by the Bishop and invested in the Diocese of Oregon Pooled Investment Fund. Bishop Hanley is the current Protestant Episcopal Bishop of Oregon. Complaint SW Morrison St, Suite Telephone: (0 -

3 1 1. The Episcopal Bishop of Oregon Foundation ( EBOF, a domestic non-profit corporation, manages a pooled investment fund that holds contributions by donors. The vast majority of the funds managed by the corporation were restricted in nature, meaning that they could only be used for specific purposes. The restricted funds were worth approximately. Million dollars as of and were primarily donated by Cornelia Wheeler, the late grandmother to Portland Mayor Ted Wheeler. These funds were restricted for use by the Chaplin at Legacy Good Samaritan Hospital and for specific purposes. Bishop Hanley is the president of the EBOF.. The Circuit Court of Oregon for Multnomah County has personal jurisdiction over Defendants. Venue is proper because all corporate defendants have a principal place of business in Multnomah County and are engaged in regular, sustained business activity in Multnomah County, and because defendant Hanley is a resident of Multnomah County.. In, Bishop Hanley assaulted a vicar, Margaret McMurren at a church during his visit to her congregation. Plaintiff reported this to Defendants in and again in. Plaintiff was involved in Defendant s investigation into the allegations and was generally supportive of Margaret McMurren s position in that investigation.. In February, Plaintiff attended the first meeting of the recently re-formed Episcopal Bishop of Oregon Foundation ( EBOF non-profit corporation and was elected Treasurer. Prior to Plaintiff s involvement as Treasurer of EBOF, the EBOF had not been holding annual Complaint SW Morrison St, Suite Telephone: (0 -

4 1 1 meetings and was not operating like a true non-profit corporation. In fact, as of, it had been stripped of its non-profit status by the IRS. Plaintiff participated in the process to have the corporation s tax exempt status renewed.. During the February EBOF meeting, Bishop Hanley moved to permit the Diocese of Oregon and him, as Bishop, both individually and as Corporate Sole, to have unrestricted access to the. million dollars of otherwise restricted EBOF funds. Plaintiff opposed this practice during the meeting and prior to the meeting.. Prior to this meeting, Plaintiff knew that Bishop Hanley planned to misappropriate funds from the EBOF, and had previously reported to Paul Dakopolis and Bishop Hanley that she believed this to be unauthorized and in violation of the law. Plaintiff knew that Bishop Hanley had wanted to misappropriate these funds well before the meeting because, as far back as 1, he had told her he wanted to use the restricted funds for general Diocesan use.. On or about June,, Plaintiff reported that she felt she was a whistleblower under state and federal law because of the concerns she had raised about the lack of financial transparency and for her participation in the investigation into the assault of the vicar. Defendants then retaliated against Plaintiff by changing the terms, conditions and privileges of her employment by subjecting her to stricter scrutiny than other similarly situated employees. 1. In July, Plaintiff, this time through legal counsel, again reported that Bishop Hanley Complaint SW Morrison St, Suite Telephone: (0 -

5 1 1 assaulted a vicar and also that there was a lack of transparency and proper governance in place with Defendants. She reported that the problems with the Diocese s financial dealings and lack of corporate governance interfered with her ability to properly perform her ethical and legal obligations to the Diocese, as mandated by her profession and by Oregon law. Plaintiff offered to meet with the full Diocesan Board to discuss her concerns about the assault, lack of transparency and proper governance in more detail, but the full Board did not contact her to set up a meeting. 1. Faced with the Diocesan board s lack of response, on August,, Plaintiff made a more specific report to the Board of Trustees and Standing Committee for Defendant Diocese of Oregon and all other Defendants. In that report, Plaintiff reported and opposed the following unlawful acts: a. Assault; b. The Bishop s misuse and misappropriation of restricted EBOF funds; c. Tax Fraud, by way of the Bishop s acceptance of tax-deductible, donations in exchange for members obtaining membership in the Arlington Club; d. Sex discrimination against female priests; e. Age discrimination; f. Breach of fiduciary duties by both the Board of Trustees and Diocesan Council by failing to exercise proper oversight over Defendants, by being overly reliant on Bishop Hanley for information and guidance, and for essentially abdicating their responsibilities; and g. Withholding pay to priests.. After Plaintiff s August, report, Defendant s retaliation against Plaintiff increased dramatically and Defendant took take steps to terminate Plaintiff s employment with Complaint SW Morrison St, Suite Telephone: (0 -

6 1 1 Defendants. By way of example, very soon after this report, Defendants asked Plaintiff to go on administrative leave, which Plaintiff declined. Then, Defendants changed Plaintiff s reporting structure so that she no longer report to the Bishop, directly, and instead reported to Neysa Ellgren, who had a strained relationship with Plaintiff. Defendants then initiated the services of outside consultants to investigate and gather dirt on Plaintiff as a pretext for termination, and to find a way to push her out. Defendants then removed Plaintiff as Treasurer of the Episcopal Bishop of Oregon Foundation in retaliation for her reports and to further expedite Defendants misappropriation of EBOF funds donated by Mrs. Wheeler. Plaintiff was then placed on involuntary administrative leave as of May, and, on October,, Defendants terminated Plaintiff s employment.. Plaintiff has suffered economic damages in an amount to be proved at trial, but currently calculated at $,000, in lost wages and pension benefits from October through an anticipated trial date of December, as well as interest on those pension benefits and full medical and dental benefits in an amount to be proven at trial. Plaintiff is entitled to reinstatement of employment and, in the alternative, an additional sum of front pay in lieu of reinstatement, in an amount to be proven at trial but currently calculated as $, from January through December, pursuant to ORS A.. Plaintiff has suffered noneconomic emotional distress damages in the amount to be proved at trial, but current calculated at $00,000.. On or about July,, Plaintiff filed a Complaint with the Bureau of Labor and Industries about the information set forth above, as well as subsequent amended complaints. Complaint SW Morrison St, Suite Telephone: (0 -

7 1 1 BOLI s investigations were closed as of July, and August,, respectfully.. All defendants each actively participated in and ratified the acts and decisions of each other, including their plan to discriminate, harass, denigrate and ultimately terminate Plaintiff because of her whistleblower activities.. Plaintiff intends to amend her complaint to seek punitive damages against all Defendants. Furthermore, to the extent that the court determines that Plaintiff cannot proceed with aiding and abetting claims against the individual Defendants, Plaintiff intends to amend this complaint to assert employment discrimination claims against them, directly, as co-employers with Diocese of Oregon.. Plaintiff is entitled to her costs and reasonable attorney fees, including expert witness fees, per ORS A. and ORS.. Plaintiff is entitled to pre-judgment and postjudgment interest on any and all damage awards.. Unless enjoined, defendants will continue to engage in the unlawful acts of misappropriating funds from the EBOF and converting them for their general use as described herein. Plaintiff has no adequate remedy at law and, as an active member of the Episcopal Church, is now suffering and will continue to suffer irreparable injury from defendant's acts and the pattern or practice of discrimination unless relief is provided by this Court. Accordingly, Plaintiff is entitled to injunctive relief pursuant to ORS A.(1. Complaint SW Morrison St, Suite Telephone: (0 -

8 1 1 FIRST CLAIM FOR RELIEF (Retaliation ORS A.00(1(f Against Defendant The Diocese of Oregon. Plaintiff restates and realleges paragraphs 1 through as if fully set forth herein.. Plaintiff opposed unlawful employment practices when she complained that Defendant Diocese of Oregon was discriminating against employees because of their sex and their age.. Because of Plaintiff s actions set forth above, Defendant retaliated against Plaintiff in the terms, conditions and privileges of Plaintiff s employment by subjecting her to stricter scrutiny than other similarly situated employees, hiring outside vendors for the purpose of investigating Plaintiff, unfairly reprimanding her, subjecting her to ridicule, changing the terms and conditions of her employment, removing her from the EBOF board, placing her on administrative leave and terminating Plaintiff s employment, in violation of ORS 0A.00(1(f. SECOND CLAIM FOR RELIEF (Whistleblower Retaliation ORS A. Against Defendant The Diocese of Oregon. Plaintiff restates and realleges paragraphs 1 through as if fully set forth herein.. Plaintiff opposed unlawful employment practices when she complained that Defendants Complaint SW Morrison St, Suite Telephone: (0 -

9 1 1 engaged in the following activities: a. Assault; b. The Bishop s misuse and misappropriation of restricted EBOF funds; c. Tax Fraud, by way of the Bishop s acceptance of tax-deductible donations in exchange for members obtaining membership in the Arlington Club; d. Sex discrimination against female priests; e. Age discrimination; f. Breach of fiduciary duties by both the Board of Trustees and Diocesan Council by failing to exercise proper oversight over Defendants, by being overly reliant on Bishop Hanley for information and guidance, and for abdicating their responsibilities; and g. Withholding pay to priests.. Because of Plaintiff s actions set forth above, Defendant retaliated against Plaintiff in the terms, conditions and privileges of Plaintiff s employment by subjecting her to stricter scrutiny than other similarly situated employees, hiring outside vendors for the purpose of investigating Plaintiff, unfairly reprimanding her, subjecting her to ridicule, changing the terms and conditions of her employment, removing her from the EBOF board, placing her on administrative leave and terminating Plaintiff s employment, in violation or ORS 0A.. THIRD CLAIM FOR RELIEF (Aiding and Abetting Discrimination ORS A.00(g Against Defendant Hanley and Protestant Episcopal Bishop of Oregon (Corporation Sole. Plaintiff restates and realleges paragraphs 1 through as if fully set forth herein. Complaint SW Morrison St, Suite Telephone: (0 -

10 1 1. Because of Plaintiff s opposition of the conduct set forth in Paragraph (a-(g above, Defendant Hanley and the Protestant Episcopal Bishop of Oregon (Corporation Sole actively participated in and caused Defendant Diocese of Oregon and all other Defendants to subject her to stricter scrutiny than other similarly situated employees, hire outside vendors for the purpose of investigating Plaintiff, unfairly reprimand her, subject her to ridicule, change the terms and conditions of her employment, remove her from the EBOF board, place her on administrative leave and terminate Plaintiff s employment, in violation of ORS 0A.00(1(g.. Because of Defendant Hanley and the Protestant Episcopal Bishop of Oregon (Corporation Sole s unlawful conduct, Plaintiff suffered emotional distress and is entitled to recover non-economic damages against Defendant Hanley and the Protestant Episcopal Bishop of Oregon (Corporation Sole in an amount to be determined at trial. FOURTH CLAIM FOR RELIEF (Wrongful Termination Against Defendant The Diocese of Oregon 0. Plaintiff restates and realleges each of the foregoing paragraphs as if set forth herein. 1. Defendant terminated Plaintiff for exercising an employment-related right of public importance and in violation of public policy. A substantial factor in Defendant Diocese of Oregon s act of terminating Plaintiff s employment was that Plaintiff reported information set Complaint SW Morrison St, Suite Telephone: (0 -

11 1 1 forth in Paragraph (a-(g, above. JURY DEMAND Plaintiff demands a jury trial on all questions of fact or combined questions of law and fact raised by this complaint. WHEREFORE, plaintiff prays for relief as set forth in each claim for relief, for her attorney fees, expert witness fees, costs and disbursements, and pre- and post-judgment interest as applicable, and for such other additional relief in favor of plaintiff as the court deems just and appropriate. Plaintiff further seeks an Order requiring Defendants to return all monies misappropriated from the EBOF funds to the EBOF, with interest, and to only use such funds for purposes consistent with their restricted intent. DATED this th day of October,. /s Matthew C. Ellis Matthew Ellis, OSB No. 000 SW Morrison, Suite Attorney for Plaintiffs Ph: 0-- matthew@employmentlawpdx.com Attorney for Plaintiff Trial Attorney: Matthew C. Ellis Complaint SW Morrison St, Suite Telephone: (0 -

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