Not so lucky

A UW whistleblower gets sacked after reporting more mishandling of med-school money.

After 25 years of employment at the University of Washington, Lorie Lucky lasted just six months at the UW Medical School. "Everywhere else I worked, they were eager to learn of financial irregularities," says Lucky, a former UW department manager. "Not at the med school." In fact, after bringing apparent conflicts of interest to the university's attention in 1995, she was banished from her office and sent home—with pay. For nine months, the UW gave Lorie Lucky more than $25,000 to sit around the house doing nothing. "It's sort of like being in jail, but getting a check for it," she says. "I was shocked—I didn't know the state of Washington paid people to not work." Then she noticed a portion of her $775-a-week UW stay-home salary was being wrongly paid from a federal grant account dedicated to cancer research. Lucky's eyes bugged out when she read the check stubs. "They sent me home so I wouldn't report any more irregularities," she says, "then they send me one in the mail."

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Today, Lucky, 53, has settled a whistleblower's suit she brought against the UW for its alleged retaliation. To her, it's a victory of sorts. To the UW, it's just another disgruntled-employee case. "The circumstances of Ms. Lucky's departure from the employment at the UW," says medical school spokesperson L.G. Blanchard, "were and are completely unrelated to any claims of her whistleblower status." But her case appears to have prompted a quiet shift in UW oversight policy—ending the school's past practice of protecting whistleblowers. To report improper actions today, UW employees must call the state auditor in Olympia rather than go through UW channels. "There's a message there," says Lucky. "It says: 'We don't want to hear about it.'"

Lucky's story is yet another in a series about UW med school irregularities revealed in the past 18 months. Most of the incidents involve conflicts over grant funds that have made the UW one of the nation's leading research institutions. Two months ago, Dr. Thomas Griffin, Department of Radiation Oncology chair, resigned as the state auditor began a review of the relationship between his university position and the Bellevue cancer center he operates (three conflict-of-interest allegations against Griffin have been sustained). In July 1997, Richard E. Emerson, former Heart Catheter Lab department manager, was sentenced to 11 months in jail for falsely submitting 40,000 hours of time-payment claims, amounting to more than $200,000 (a fraud that went undetected for 19 years). Also last year, after UW officials were questioned by federal investigators about possible misuse of Medicare funds, three private foundations were found operating within the Montlake med school. According to an audit, Arrhythmia Services researcher Dr. Gust Bardy wrongly funneled private funds through the accounts, since closed, that had operated unnoticed by UW higher-ups from 1989 through 1995.

Against this troubling background, officials wasted no time moving against Lucky. After working at various UW administrative and staff positions since 1969, she transferred in August 1994 to the newly created $40,000-per-year Department of Urology manager's job, where she was to coordinate faculty and office services. Almost immediately, she said in her lawsuit and in a recent interview at her Madrona home, she heard staff complaints about harassment, intimidation, and financial irregularities. When she first tentatively raised such questions with top school officials, she says, she was told that "people who talked about auditors and audit problems were labeled troublesome," and was reminded that her new position was expendable. Yet, "once you see some of these things, you can't stay quiet." Lucky continued to alert officials after discovering such financial quirks as a cancer researcher getting full-time pay for half-time work, and a department head who was having a romantic relationship with a departmental contractor. Lucky says she brought these and other issues to her bosses' attention through meetings and e-mails. Her queries got a cold reception and her working conditions deteriorated, she says. "I was developing a pretty healthy case of paranoia as well."

Apparently it was justified. On January 24, 1995, two med school officials strode into her office and placed her on immediate administrative leave. One of them, Harlan Patterson, director of finance, read from a letter he had typed up, stating that he would be "investigating the appropriateness of your behavior." He said Lucky's messages "have been upsetting to others, both those whom you have accused and those who have been exposed to personal and confidential departmental matters." Her e-mail account was closed, and she was quickly escorted out.

"I told them they were violating my rights as a whistleblower," says Lucky. "They said I wasn't a whistleblower yet, because I hadn't gone to the state auditor." Two days later, the UW posted an official schoolwide notice that seemed intent on establishing a legal point while also chilling the ardor of future whistleblowers. The notice states that the UW "cannot provide protection to whistleblowers" and thus "has discontinued its internal whistleblower policy."

Lucky passed along her accusations to state auditor Brian Sonntag, then went home to sit by the phone 40 hours per week—as required by the terms of her administrative leave. In February 1995, Sonntag wrote that Lucky's allegations entitled her to protections through the state Whistleblower Act. (In court, the UW argued that she was not a protected whistleblower until after she was sent home.)

Seven months later, on September 8, Sonntag issued his report, which relied in part on the UW's own internal audits. Sonntag found that many of Lucky's charges couldn't be proved, despite how things might look—the contractor and department head, for example, indeed had a romantic relationship, but the chairperson denied having any hand in hiring the contractor (auditors simply recommend better management control over such contracts).

Sonntag did substantiate a charge of improper med school invoicing and agreed that the half-time researcher was being overpaid. UW spokesman Blanchard says, "The audit process did not find substantiation for any material allegations," and maintains the UW also won its point on the federal research funds paid to Lucky for staying home. "The circumstances of Ms. Lucky's employment and pay sources during the period referenced," says Blanchard, "were thoroughly reviewed through the independent audit process. The determination was that the university's actions were appropriate." However, a copy of Sonntag's audit, referring to the allegation of whether the pay was "improperly being charged to a federal grant as a direct cost," concludes: "This allegation has been substantiated." Lucky says the UW had to repay the account $6,200, but was not penalized.

On October 9, the UW officially terminated Lucky by mail, citing gross misconduct and insubordination for revealing confidential information, making false claims, and misusing her e-mail. She was four years from retirement. In April 1996, Lucky filed suit claiming the UW illegally retaliated against her for whistleblowing. The two sides settled a few months ago—for a figure neither can disclose but one that, Lucky says, "will keep me poor for the near future."

Although not all of her claims were validated, Lucky does not regret bringing them to the UW's attention. Currently out of work, though, she is puzzled. "When did exposing waste on the job become a radical act?" she asks.

Last week, the state auditor reported yet more shenanigans at the UW Medical Center. One technician stole more than $6,500 in supplies, some of which he shipped out of the country. He was found with tanks of stolen Isoflurane in his car last March and later admitted to reselling the anesthetic to overseas contacts. A student employee at the Pathology Department worker was paid for 420 hours he never worked; he claimed 480 hours over a 17-month period but confessed he actually worked only 60, for a net theft of $2,730. Both cases have been referred to the King County prosecutor.

Eleven med school employees received $30,150 in questionable payments beyond their regular salaries, thanks to a private foundation operating illegally within the school's Arrhythmia Services Division (as reported in "The Grant Game," SW 1/22/97). The auditor also found that inadequate internal controls over millions in Medical Center cash payments posed the risk of fraud or theft.

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