The Fayette County Board of Education has reached a settlement with its former in-house attorney, promising to pay her $200,000 in exchange for her pledging not to sue the school board.
According to the settlement, Brenda Dinkins Allen had threatened to file suit against the board alleging that its termination of her job this summer was "a reprisal and/or unlawful retaliation" and a breach of contract in violation of state law.
The Herald-Leader obtained a copy of the settlement under the Kentucky Open Records Act. The agreement was signed in early August by Allen, Superintendent Stu Silberman, then-board chairwoman Becky Sagan and vice chairman John Price.
Fayette Schools officials declined to comment Thursday, citing confidentiality provisions in the settlement. Allen, who recently established her own law office in Frankfort, could not be reached for comment.
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Exactly how much the settlement will cost the school system is unclear. In such cases, costs usually are covered by a school district's liability insurance. The Fayette Schools' legal liability insurance policy carries a deductible of $30,000, according to information provided under the open-records request.
Fayette School Board members voted last March to phase out Allen's in-house general counsel office and outsource the board's legal needs. The decision came after the board received a consultant's report that estimated outsourcing could save the schools $250,000 to $350,000 per year.
Board member Amanda Ferguson cast the only vote against outsourcing, arguing that it wouldn't save money and that the board would lose the advantages of having an in-house lawyer available whenever needed.
Allen's job ended June 30, and two other positions in her office also were eliminated.
The nine-page settlement agreement says the school board "shall cause" Allen to be paid $200,000 in exchange for Allen agreeing "not to file or initiate a lawsuit in any court" pressing claims that her termination was illegal.
The settlement also states that the agreement should not be construed as an admission by the board that it violated laws or regulation in terminating the in-house counsel position.
All parties also agreed to keep the settlement confidential.
In March, Silberman said the plan to eliminate Allen's office and outsource legal needs was intended to save money. He said the school board began looking at the option after Sagan, who has since left the board, learned that Fayette County was one of only a handful of public school districts statewide that employed in-house lawyers.
The school board's annual employment contract with Allen provided that it could choose not to renew her contract at its sole discretion.
Richard Day, a Lexington-based blogger and former Fayette elementary school principal, later suggested on his blog that Silberman wanted to get rid of Allen, a charge that Silberman and Sagan denied.