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queens library trustees sacked queens library trustees lawsuit sacks lawsuit

Landmark Case: Battle For Queens Library Stewardship

Six Sacked Queens Library Trustees’ File Lawsuit Alleging Queens Borough President Violated Constitutional Rights & That NYS Law Changing Queens Library Charter Is Invalid

melinda katz sacks queens library trustees lawsuitTemporary Restraining Order Fails But Lawsuit Goes On

August 5, 2014 / Queens Politics / Queens Issues / News Analysis & Opinion. Queens Buzz. On August 1st, the six Queens Library Trustees who were sacked by Queens Borough President Melinda Katz on July 23rd, filed a lawsuit against her in both her official capacity as well as that as an individual. Eric Schneiderman, the NYS Attorney General [in his official role], and NY State were also named in the lawsuit.

Sacked Queens Library Trustees File Lawsuit

The six trustees and plaintiffs are Jacqueline Arrington, Joseph Ficalora, William Jefferson, Grace Lawrence, Terri Mangino and George Stamatiades. Two others were sacked by Mayor Bill de Blasio - Patricia Flynn and Stephen Van Anden - and they are not participating in the suit. There are a total of 19 Queens Library Trustees.

Click here to read the rest of the story about sacked Queens Library Trustees filing lawsuit.


Landmark Case: Battle For Queens Library Stewardship

Six Sacked Queens Library Trustees’ File Lawsuit Alleging Queens Borough President Violated Constitutional Rights & That NYS Law Changing Queens Library Charter Is Invalid

Temporary Restraining Order Fails But Lawsuit Goes On

August 5, 2014 / Queens Politics / Queens Issues / News & Analysis. Queens Buzz. Continued.

There are four sections to this report:

1. Queens Library Trustees Lawsuit Complaint

2. Queens Borough President's Office Defense

3. Queens Library Legal Documents & Timeline

4. Queens Library Controversy Issues: Legal & National Implications

I. Queens Library Trustees Lawsuit Complaint

The plaintiffs' lawsuit is being handled by Schlam, Stone & Dolan LLP. The lawsuit makes five claims and starts with a brief summary of what it described as

“This action seeks to halt a brazen, and unconstitutional, power grab by the Queens Borough President … to transform the Queens Borough Public Library (the “Library” or the “Corporation”) from an independent, private, nonprofit corporation into an organ of City Government controlled by the Queens Borough President and Mayor.”

The first claim in the lawsuit is against Attorney General Schneiderman and the State of NY, the second claim is against Schneiderman, NYS, and Queens Borough President Melinda Katz. Both of these claims name the defendants in their governance roles. The third and fourth claims are against Katz as an individual, and the fifth claim is against Katz in her official capacity.

Lawsuit Claims NYS Law Unconstitutional & Alleges Infraction Of Rights & Harm

1) The first claim states that the NYS Legislation is in violation of the charter agreement established among and between the city, state and Queens Library Corporation when it was founded with respect to the: 1) 1901 Agreement with Andrew Carnegie, and 2) the subsequent Agreement between Andrew Carnegie's successor the Queens Borough Public Library and NYC, and 3) the NYS Act of creating Queens Borough Public Library - the latter two both completed in 1907.

Under Article 1, Section 10 of the U.S. Constitution says that States may not make laws impairing the obligation of contracts. This means that the law cannot retroactively impair contract rights, or put another way, the law can’t take away rights one held or exercised prior to the passage of a state law. For the plaintiffs, the rights in question are the rights they exercise as Queens Library Trustees as set forth in the Queens Borough Public Library documents of 1907. And the independence of the Queens Borough Public Library Corporation as outlined in the Agreement between Andrew Carnegie and NYC in 1907.

2) The second claim is a request for a permanent injunction that would stop the Borough President from going through with sacking the six Trustees - stating that per #1 above, the NYS law is unconstitutional, and acting upon it would cause irreparable harm to the six sacked Trustees.

3) The third claim is that Queens Borough President Katz’s actions directly and proximately have caused the Trustees severe harm.

4) The fourth claim is that Katz violated the Trustees’ rights under the First Amendment Right to Free Speech. The complaint alleges that in July 23rd letters sent to the plaintiffs, Katz referenced the Trustees’ votes on April 3rd and May 8th of 2014. Thus, the complaint claims that this action by the Queens Borough President was retaliation against the Trustees for their votes / speaking out on matters of public concern.

It's worth noting that retaliation against public employees speaking out on matters of public concern is a First Amendment violation. But technically the Queens Library has operated independently of the government and the trustees are not public employees. But that said, the recent NYS legislation changing the corporation’s governance, may allow the plaintiffs to argue that it is no longer an independent organization [but now a captive organization of the government] because the Mayor and the Queens Borough President can now remove the Trustees without recourse on a week of notice, thus enabling them to control exact outcomes by trustee votes. And the Trustees are ultimately responsible for the overseeing the Queens Library System operations.

5) The fifth claim. Since the votes referenced in their dismissal were cast prior to the enactment of the NYS legislation on June 26th, the sacking of the Queens Library Trustees constitutes an illegal action, as the votes were placed prior to the law going into effect.

This references back to the constitutional law cited above under Article 1, Section 10 of the U.S. Constitution, wherein the government is not allowed to retroactively impair contract rights.

 

II. Queens Borough President's Office Defense

Queens Borough President Responds To Lawsuit Citing Governance Issues

The Queens Borough President’s Office responded by filing a Declaration of Opposition to the TRO [Temporary Restraining Order] which included a brief summary of how the conflict started [news report about construction of an outdoor deck to accommodate Queens Library CEO’s smoking] and cited the justification for the sackings as an effort to rein in profligate spending of a largely publicly funded organization [Queens Library is approximately 85% funded by NYC government].

In the letters sent to the sacked trustees on July 23rd, 2014; the Queens Borough President explained to Queens Borough Library Trustees the rationale for her actions:

"1. It appears to my satisfaction that you have failed to carry into effect the educational purpose of the QBPL by failing to adequately protect and preserve the physical property and resources of QBPL, failing to appropriately oversee the management of the QBPL and authorizing the expenditure of library funds for purposes that do not further its educational purpose.

2. ... and to adequately protect and preserve the physical property and resources of QBPL by voting to withhold financial and funding information from the NYC Comptroller and allowing for the expenditure of QBPL funds to litigate against the Comptroller's rightful authority to fully audit QBPL funding streams."

It's worth mentioning that in the past the NYC Comptroller and the Queens Library have clashed and subsequently negotiated a settlement as to exactly how much access to financial records the NYC government is entitled. One such conflict was in 1997 with NYC Comptroller Hevesi. I was informed by the Queens Library that the NYC Comptroller has had auditors at the Queens Library since February 2014 and that they have been given access to the financial records as stipulated in the court-ordered settlement of 1997. And both the FBI and NYC DOI [Department of Investigations] have been investigating the Queens Library since February too.

Queens Borough President Defense To Claims Made Against Her

Essentially the lawsuit relies upon two important foundations of the American legal system: 1) the contract clause of the Constitution and 2) the First Amendment Right to free speech. In laying the framework for the Queens Borough President’s defense, the Queens Borough Presidents Office attorney, Thomas B. Roberts, researched a number of court rulings related to the legal precedents outlined in the lawsuit.

The Contract Clause & Justice Story’s Concurring Opinion In The Dartmouth College Case

The Contract Clause of Article 1, Section 10 of the U.S. Constitution was identified in the plaintiff’s claims above as the rationale for declaring the Queens Library Reform Bill invalid. It says the states cannot take away rights exercised prior to the passage of the bill.

The Queens Borough President’s Office [QBPO] cites the concurring opinion of Justice Story written in 1819 with regard to the Trustees of Dartmouth College vs Woodward case. In that case Daniel Webster successfully argued that the state of New Hampshire could not transform the privately chartered Dartmouth College into a public organization and thus reinstate its former president, Woodward; who the trustees had ousted. The rationale was that the original charter was a private contract protected by the Contract Clause of the U.S. Constitution.

Justice Marshall wrote the opinion, and according to the QBPO brief, Marshall cited that Dartmouth was an entirely private corporation, receiving no funds from the state and not designed to further the state of New Hampshire’s public interest.

Justice Story’s concurring opinion modified the sweep of Chief Justice Marshall’s Opinion, by stating that States could insert reservation clauses in corporate charters to enable legislatures to alter or amend charters.

The Queens Borough President’s Office brief differentiates the QBPL from Dartmouth, stating that it was designed to further the public interest of NYC and has received funding from NYC for the past century. They describe the new legislation as incremental charter change, increasing the power of the Mayor / Borough President – not as a complete takeover of the private entity. This is likely to be debated as this legislation effectively transfers to the public officials complete control over, not just the trustees, but by means of being able to replace them on short notice, controlling their every vote and thus complete control over the organization.

The QBPO also cites Article VIII, Section 1 of the New York State Constitution change of 1894 [re-numbered Article X, Section 1].

“Corporations may be formed under general laws; but shall not be created by special act, except for municipal purposes, and in cases where, in the judgment of the legislature, the objects of the corporation cannot be attained under general laws. All general laws and special acts passed pursuant to this section may be altered from time to time or repealed.”

This allows the state to make changes to laws and acts. As will be mentioned in the timeline below, the QBPL was formed by Act in 1907.

Queens Library Lawsuit: QBPO Response Regarding Violation Of First Amendment Rights

Regarding the First Amendment related claims of the lawsuit, the QBPO responded with a statement of which I believe the following represents the gist of it:

… “Plaintiffs make the extraordinary claim that the First Amendment prevents the Borough President from removing trustees who have voted in a manner that (i) permits the waste of public funds, (ii) breaches a duty to further the educational policies mismanagement of the QBPL by the Comptroller, and (iii) obstructs an appropriate investigation into the into the mismanagement of the QBPL by the Comptroller, and (iv) damages the reputation of the Library.” …

It’s worth noting that the first, second and fourth statements are - as of this writing - unproven allegations [and ultimately in some measure subjective]. The third point however, that of obstructing access [via litigation] to the company's financial records by the NYC Comptroller is a fact.

In the Queens Borough Public Library Agreement of 1907, the NYC Comptroller is given specifc rights to request and receive documentation for somewhat specified expenses and receipts. It's worth mentioning that the financial statements of the Queens Borough Public Library are prepared and audited by Certified Public Accounting firm of Israeloff, Trattner and Company from Garden City, NY. We aren't versed on the details of this separate legal dispute, but on the surface, it appears it's well within the rights of the NYC Comptroller to seek and obtain access to some level of the QBPL financial records based on the originating contract and given NYC funds 85% of its operations.

And in some measure, access to this information is why this conflict began - but unfortunately it's not where it ends. It's worth noting, that in 2013 the NYS Comptroller sought access to the Success Academy Charter School's records and was successfully rebuffed even though NYC & NYS funds a significant portion of Success Academy's operations. And it's worth noting that there have been prior disputes between NYC and the Queens Borough Public Library over how much access to its financials NYC is entitled. Click here and scroll down to read about Success Academy Charter Schools rebuffs NYS Comptroller.

The QBPO brief also states that the Act of Incorporation provides power to the Mayor & QBP to replace appointed trustees. The way this is presented in the Brief, seems to imply that replacing includes sacking, but in all of the original documentation I read, the Mayor & Borough President are allowed to appoint replacements, but the remainder of QBPL governance including removals was to be managed by the trustees. It's worth noting again that the trustees include the Mayor, Queens Borough President, NYC Comptroller & NYC Public Advocates who are ex officio of the 19 trustees.

The QBPO cited two precedent cases: 1) Miller vs Town of Hull in 1989 and 2) Garcetti vs Cebalos 2006.

In the first case, Miller vs Town of Hull, elected officials can be removed for:

"… inefftciency, neglect of duty or misconduct …"

but may not be removed

“… on the basis of defendants' agreement or disagreement with plaintiffs' position and views on matters of town policy."

The QBP's legal counsel summarized the relevance of this case by stating that,

“… the plaintiffs have been removed due to disagreements over the proper intemal management of the QBPL - not over a matter that is integral to the core educational mission of the Library (such as the selection of books or the content of Library programs).”

The second case, Garcetti vs Cebalos, is about the right to sack the trustees, referencing their First Amendment Right of Free Speech. The following quotes summarize the gist of why this case is referenced.

“… a public employee has no First Amendment retaliation claim for speech within his or her official duties …”

“To determine whether or not a plaintiff s speech is protected, a court must begin by asking whether the employee spoke as a citizen on a matter of public concern. If the court determines that the plaintiff either did not speak as a citizen or did not speak on a matter of public concern, the employee has no First Amendment cause of action based on his or her employer's reaction to the speech."

I'm pretty sure that the Trustees of the Queens Borough Public Library are not employees of the city, unless of course you believe that the Queens Borough Public Library Corporation was just defacto taken over by the NYC government via the Queens Library Reform Act signed into law on June 26th, 2014. If the Queens Library trustees are considered to be working for an independent entity, then they likely fall under the category of citizen as my understanding is that they are not employees and not compensated. Also it appears this whole conflict is about BOTH matters of public concern and about the dispatch of the trustees' official duties.

Thus you can see that this is going to be an interesting and POSSIBLY LANDMARK CASE as the issues are significant with sweeping national implications and the legal grey areas are many. The case already references century old historical documents [QBPL charter & Andrew Carnegie contract with NYC] and legal precedents dating back two centuries ago. And there's a tie into no less than one of the nation's foremost litigators: Daniel Webster. This is going to force the legal combatants to dust off their law books and dig in for what could be a landmark case which, depending on the combatants motivations to win or compromise, could make a journey all the way up to the Supreme Court.

 

III. Queens Library Lawsuit: Legal Documents & Timeline

Queens Borough Public Library Lawsuit: Queens Library Governance History

In 1901 the city entered into an agreement with agents of Andrew Carnegie to create a free public library system in Queens. In 1907 two events occurred: 1) an Agreement between Andrew Carnegie representatives & and what would be their successor [the Queens Borough Public Library] and the City of New York and 2) the New York Legislature adopted an Act of Incorporation establishing the Queens Borough Public Library. The act laid the groundwork for NYC Comptroller's financial record access and the creation Board of Trustees, which was to include, ex officio, the Mayor, the NYC Comptroller and what is today the Speaker of the City Council along with 15 other trustees who were to name their own successors subject to approval of the Mayor. And this body was to self-organize by the adoption of by-laws and the election of officers. In 1913 the legislature amended the Act of Incorporation to limit trustees to five-year terms and transferred the power to select trustees to the Mayor. Andrew Carnegie died in 1919.

Post Carnegie’s death, in 1992, the power to appoint trustees was to be shared by the Mayor and the Queens Borough President. In 2002 the Public Advocate was added as an ex officio trustee, bringing the total trustees to four ex officio trustees [the Mayor, Queens Borough President, NYC Comptroller & NYC Public Advocate] and 15 from the private sector. They serve five year terms and may do so successively. Currently NYC provides approximately 85% of the Queens Borough Public Library [QBPL] funds, which in 2014 is expected to be about $123 million.

So, from 1901 / 1907 up until this past month, the governance of the Queens Borough Public Library, including trustee dismissal, was handled by the Queens Borough Public Library Trustees. All new trustees were subject to appointment approval by the Mayor – who subsequently shared appointment approvals with the Queens Borough President. Thus the Queens Borough Public Library has, to date, operated as an independent non-profit in accordance with the governance outlined in contracts and legislation approved prior to Andrew Carnegies’ death. And Carnegie named the Queens Borough Public Library as successor to his rights when the 1907 Act of Incorporation was instituted. A court case was cited in the plaintiff’s brief referencing a court case supporting the library’s independence, leaving trustee removal to the governance by the trustees.

Fast forward to 2014 when a story breaks about a deck being built to accommodate the smoking habit of the Queens Borough Public Library CEO. The report included news of the Queens Borough Public Library President’s salary, which while comparable to other CEO’s operating non-profits of a similar size and nature, is far greater than the Mayor’s and the Queens Borough President’s. The reporting news organization included the CEO's severance package approved in 2012, which included five years pay, that he had income from a second job and a nice car. The FBI and NYC Department of Investigations began investigating and to date no wrongdoing has been found / annouced. Click here to read a prior Queens Buzz report detailing these items of the Queens Library Controversy.

It’s worth adding that the Queens Borough Public Library is currently considered to be one of the finest libraries in the nation, as rated by its peers in the industry, awards it has received and metrics measuring its success as denoted by its performance statistics such as the circulation of books [QBPL book circulation is one of the highest in the world]. Many attribute this success to the leadership of the Queens Borough Public Library CEO. This information is also contained in our prior report on the Queens Library Controversy.

To put public servants’ compensation in perspective vis a vis what is paid by private industry, we find it necessary to inform you that almost every publicly elected officer in this country is vastly under compensated vis a vis any privately employed person responsible for comparable budgets. The President of the United States of America makes $400,000 per year and is responsible for nearly a $3 trillion budget. The Mayor of NYC makes $225,000 per year and is responsible for a $73 billion budget. The Queens Borough President makes $160,000 per year and handles a $40 million budget. All of these government officials play an important role in managing these public budgets and have other responsibilities to the public that extend well beyond the budgetary role.

Let’s look at a few private industry compensation packages in 2013. Larry Page and Sergey Brin, co-founders of Google EACH made $9.3 billion in 2013 co-managing a budget of $16 billion. Mark Zuckenberg of Facebook made $10.5 billion managing a budget of $7.8 billion. And IBM’s CEO Ginni Rometty made $16 million managing a $100 billion budget. Robert McDonald CEO of Proctor & Gamble made $16 million managing a budget of $84 billion. Naturally non-profit CEO's make far less [no stock / options], but a third party investigated the Queens Library CEO's compensation relative to others managing comparable or comparably-sized non-profit entities and found the Queens Borough Public Library CEO's compensation to be relatively comparable. So you can make your own judgments about compensation fairness, with a bit of understanding how fair compensation is generally in this country, where the public servant’s compensation packages differ greatly vis a vis private industry entrepreneurs and both for profit and non-profit CEOs.

The rest of the timeline gets into the nitty gritty back and forth between the new Queens Borough President and the Queens Borough Public Library Trustees this year. Queens Borough President Katz, as one of the primary stewards of the NYC public funds [which represent the vast majority of the Queens Library funding] wanted the trustees to give her or the NYC Comptroller access to financial information. The trustees decided not to comply. She wanted the CEO put on hiatus and they decided not to comply.

So ultimately Katz did an end run around them, working with a couple of Queens-based NYS officials [Senator Michael Gianaris (D Astoria) and Assemblyman Jeffrion Aubry (D Corona)], to draft a bill to give her and the Mayor what appears to be complete control over the Queens Borough Public Library Board of Trustees and hence the Queens Borough Public Library itself. The Mayor and Queens Borough President are now able to fire trustees at will, and dismissed trustees are not provided with any real access to due process or redress, and they may be removed within a week. Prior to the enactment of this law, only the Board of Trustees could dismiss a trustee and they were given five year terms.

Thus this new law essentially gutted the Queens Borough Public Library of any independence from the city that it once had. And Mayor de Blasio and Queens Borough President Katz wasted no time in exercising their new found powers by removing two [respectively] and six [plaintiffs] trustees citing their efforts to block financial record access to NYC Comptroller Stringer.

And this is how we all arrived here. In this place. At this time. Confronting a number of important and in some senses conflicting issues. I can only hope that the lawsuit goes before a wise judge who will invest the time to render a verdict that is in the public’s favor.

 

IV. LANDMARK CASE: Queens Library Controversy Issues: Legal & Societal Implications

Queens Borough Public Library - Queens Library Trustees Lawsuit Issues

What I outline here are the issues of this case which are intertwined and contradictory and that need to be untangled and adjudicated properly as they have long term repercussions as precedents for how we are to operate as a society - not just here in Queens - but nationwide. I do not address what I consider to be the short term and personal outcomes of the lawsuit like the alleged harm to the Trustees or the alleged lack of financial oversight on the part of the trustees, because these outcomes are short-lived and are less likely to have long term repercussions to us as a society.

  • Issue - Ensuring Public Funds Are Spent Wisely
    • The Queens Borough President and NYC Comptroller have repeatedly tried to obtain information about how the public’s funds are being spent, and have not been able to obtain the information required to allay their concerns of possible financial mismanagement. They have rights to some of the information as outlined in the organizing documents and subsequent amended agreements and I do not know if the NYC Comptroller's lawsuit is about the exercise of those rights, or the expansion of them. It's worth noting again, that in 2013, Success Academy Charter Schools, which also receives a significant amount of its funding from the government, was able to defeat a lawsuit by the NYS Comptroller to gain access to their financial records. So there are precedents for pushback - and I don't know how either of these pushbacks have been justified - but I think they should be linked. If you can audit the Queens Library, then you should be able to audit Success Academy Charter Schools. On the surface it would seem to allow the auditing of one of these organizations and not the other would be an uneven application of the law.
    • The important point here is that the NYC Comptroller's public audit function must be given teeth because over $100 million of public funds each year are at stake. The right to access to financial information was set forth in the 1907 Agreement between NYC and the QBPL and stipulates that the NYC Comptroller be given access to some specified level of the corporation’s records. That right was further specified in a 1997 Court ordered settelement between the Queens Library and NYC Comptroller Hevesi.
    • It’s worth noting that as of this writing no wrongdoing has been found / announced regarding the Queens Borough Public Library management of funds. And the 2013 Queens Borough Public Library’s financial statements were audited and prepared by the Certified Public Accounting firm of Israeloff, Trattner and Company of Garden City.
    • The question is, whether gutting the Queens Borough Public Library of its independence is the right way to accomplish this as was done in the Queens Library Reform bill passed by the NYS Legislature in June 2014. See section above and related story entitled Queens Library Controversy.
  • Issue - Precedent For Usurping The Independence Of Non-Profits / Change Of Control & Ownership Impact On Donors' & Employees' Rights / Politicization Of Organizations To Which Government Funds Are Donated.
    • Can the government, by virtue of the NYS Queens Library Reform bill signed on June 26th, essentially take over the independence and governance of the Queens Borough Public Library while maintaining that the Queens Borough Public Library Corporation is independent when defacto it is not? Is this a good legal precedent?
    • Now that the NYC government has complete control and has essentially assumed ownership of the Queens Library, do Queens Library donors have the right to request the Queens Library remit their funds as it is no longer independently operated? Does the Queens Library still have the right to present itself as an independent non-profit organization for the solicitation of donations when it is entirely controlled by the Mayor, Borough President and hence has become a government agency? Are Queens Library employees now entitled to the same benefits as NYC employees, as the Queens Borough Library Corporation has been de facto eliminated as an independent organization?
    • Does this open the door to other funding reliant, non-profit takeovers by the government? Will that improve them or will they become populated with political staffers? Will non-profit cultural venues become politicized? Is this a good legal precedent? Is this a good cultural precedent? Click here and scroll down to see the opinions of the American Library Association and several other experts in the field.
  • Issue - Library Privacy / Thought Control / Employment Of Library Professionals or Political Staffers
    • The question is whether public libraries - which serve a very important public function - should be controlled by those in office or operated somewhat independent of the government.
    • These involve our First Amendment Rights to Freedom of Speech & Thought. Should NYC government officials have absolute control over the Queens Borough Public Library as provided in the NYS legislation signed by Governor Andrew Cuomo on June 26th, 2014? With no independence / checks and balances, this now makes it POSSIBLE, for government officials to control what you can read via the Queens Library. They could also change the rules to provide themselves with access to the records showing what you read, the books you checked out or the sites you visited while at the Queens Library [just like they just changed the rules giving them control of the Queens Library]. Is this good for the city / nation?
    • The Queens Library System has been successful as an independent entity. Again one can ask will they be staffed by library professionals or will they become populated with political staffers? Click here and scroll down to see the opinions of the American Library Association and several other experts in the field.

As things currently stand, the Temporary Restraining Order was not enforced and the Queens Borough Public Library Trustees will be replaced. The lawsuit will go before a judge on Monday, August 11th, to determine its merit. Based on our understanding, the trustees intend to push forward with the lawsuit.

Stay tuned. And thanks for paying attention and participating in the democracy. Thomas Jefferson said,

“Eternal vigilance is the price of liberty.”


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