BONUS: Boston College 990 Shows FY18 Expenses, Including Legal Fees Above $2.5 Million, Increasing Salaries

Plus: BC looking to appeal loss in breach of contract suit last fall, despite the fact that legal expenses for the case have probably eclipsed double what the university was initially sued for.

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Of 20 Highest Salaried Employees, 15 Received Raises, Legal Fees Up $500k

The Heights covered the broad details of what BC’s 2018 fiscal year looked like if you’re looking for the broad strokes, but BC’s 2018 saw slight drops in its net assets and endowment valuations, while its most of its highest officers received at least some sort of raise. Notable exceptions were BC’s Chief Investment Officer John Zona and Dean of the Carroll School of Management Andy Boynton. This is also the first time BC Athletic Director Martin Jarmond’s salary has been public info—he received $847,447 in 2018, which was $304,972 more than his predecessor Brad Bates made.

Perhaps BC’s most surprising charge on its balance sheet was the increase in its legal bills: BC spent $2,163,359 in legal fees, up from $1,602,972 in 2017. BC was fighting a breach of contract lawsuit with an alumnus who claimed to have wrongly been disciplined over alleged sexual assault allegations at the appellate level at the time (more on that case and its current status in the next article, but it’s likely those legal costs either remain over $2 million per year through FY2020 or continue to increase due to a second breach of contract lawsuit weaving its way through the court system right now that BC is also a defendant in).

BC’s Jesuit community, which includes multiple officers who would qualify in the highest pay bracket if they took a salary in President Rev. William P. Leahy, S.J., and Vice President of Mission and Ministry Rev. Jack Butler, received $4,812,112 from the university in 2018, $282,079 less than they did in 2017. 

Zona received the highest bonus of the highest paid officers at $260,840, the university’s highest paid employee at the time, Head Football Coach Steve Addazio, received a $75,000 bonus, and Jarmond received a $50,000 bonus. 

BC’s total assets overall decreased from $4,851,948,400 at the beginning of the fiscal year to $4,772,401,283 at year’s end. Net assets decreased from $3,459,944,577 to $3,418,671,367. Previously, BC’s fact book noted the endowment had fallen by a little over $20 million. 

Former Vice President of Student Affairs Barb Jones received both her usual salary compensation as well as an additional $115,963 “in connection with her resignation of her position and separation from the college,” according to the 990 form. Her successor, Joy Moore, joins Jarmond as the only new additions to the highest paid officers at BC—her salary was set at $247,649 for FY2018, $61,521 less than Jones, who was paid $27,914 more in 2018 than she was in 2017.

Overall, the highest paid officers at the university were paid $12,302,262 in FY2018, an increase of 596,844 over the FY2017 total of $11,705,518. 

BC’s other major expense in FY2018 was construction—the university paid out over $110 million to various construction contractors, according to the 990 form—contractors that included Suffolk construction, which is run by John Fish, who was the chair of BC’s board of Trustees at the beginning of FY2018 before moving to vice-chair in September. The 990 form did note that Fish recused himself from any decisions regarding hiring Suffolk. 

Other notable expenditures included $18,655,432 in investment management fees, which was up from $17,395,677 the previous year; $21,535,824 in travel expenses, up under $1 million from FY2017—it should be noted that that total includes charter travel for athletic teams when those teams utilized charter travel, according to the 990 form; and $5,301,648 in expenditures related to holding conferences, slightly down from the FY2017 total.

Multiple officers cited on the 990 have since departed the university. Former Vice President For Planning and Development Kelli Armstrong, Former Vice President For Development Beth McDermott, and Jones are all no longer university employees. Only Armstrong was paid less than $300,000 per year. 

Others who’ve departed include Jack Connors, Mario Gabelli, Patrick Stokes, and Elizabeth Vanderslice, who all exited the board of trustees in September, according to the 990 form. Connors’ name is on the Connors Family Learning Center, Gabelli’s is on the Gabelli Presidential Scholars, Stokes’ is on the relatively recently constructed Stokes Hall, and Vanderslice’s is on dormitory Vanderslice Hall. All are now Trustee Associates—every BC trustee that comes off the board is awarded the title of trustee associate, though how close those associates remain to Boston College is up to each individual. For example, Robert Kraft’s presence at the university is quite low compared to when he was on BC’s board, to the point that when his presence at a massage parlor in Florida became the object of scandal when the parlor was raided due to a crackdown on illegal sex-for-pay establishments in Florida, BC released a statement saying Kraft had no presence at the university. 

On the other end of that spectrum, Margot Connell is a trustee associate and continues to be massively involved in the advancement of the university—she recently had the school’s new recreation center named after her after she gave $50 million to BC to facilitate construction on the building during the university’s Light the World capital campaign. Connors, Gabelli, Stokes, and Vanderslice were all involved in the university’s activities in the way Connell has been, but if they retreat from contributing to the university the way Kraft has, it would be a massive loss for BC—that the four of them aren’t on the board anymore is a massive loss at the university’s highest decision making levels. 

A related note: This 990 does not include the $50 million charge that will appear on the school’s 2020 balance sheet resulting from BC absorbing Pine Manor College, which was announced this week. 

Correction (5/15/20, 5:25 p.m.): This article originally identified BC’s total assets as its net assets. The mistake has been corrected, and the net asset decrease has been added for clarification purposes.

BC Still Fighting Breach of Contract Lawsuit Begun in 2016, Legal Fees Have Likely Eclipsed Twice What They Were Sued For Originally ($3 Million)

In a case that just will not seem to ever come to an end, Boston College is trying to get a decision vacated that a jury made last fall awarding over $100,000 and disciplinary record expungement to a BC alumnus who claimed a breach of contract violation regarding how his disciplinary process was handled when he was accused of sexual assault in 2012 by a fellow student. 

In a brief filed last October, BC indicated it wanted a stay on all of the orders stemming from final judgement in the case, which is currently at the district court level, since the university is planning on filing an appeal of sorts—it is not strictly an appeal of the jury’s decision to rule in favor of the alumnus, only referred to as John Doe to protect his identity, it is motion claiming “no reasonable jury could have found” in favor of Doe based on “the weight of the evidence” presented at trial. 

Before we get into why BC believes it has an argument, it should be noted that BC is arguing damages awarded were too high because the jury inaccurately understood how Doe’s earning potential was being affected and that expunging disciplinary records in inappropriate given how that will affect the entire university’s record keeping operation

The crux of that evidence was based around emails exchanged between BC’s former Dean of Students Paul Chebator, former Executive Director for Planning and Staff Development Carole Hughes, and Program Manager in the Office of Residential Life Catherine-Mary Rivera. If you want to read the full details of the incident, you can find them here from a time when I was basically living another life but in the beginning stages of covering this story two years ago, but the long story short is that Doe accused Chebator of breaking BC’s contractual obligation to providing Doe a fair disciplinary hearing by influencing the hearing board’s decision. 

Doe’s original lawsuit asked for $3 million and an expunged disciplinary record, but parts of the case were dismissed the first time this case went through district court in 2016 and then again when the suit was ruled on in 2018 by the First Circuit Court of Appeals. But this claim by Doe, that Chebator influenced his hearing process, was originally ruled on by District Court Judge Denise Casper in 2016 in favor of BC. On appeal, the First Circuit vacated her decision, sent this aspect back to district court, and required that a jury rule on the matter.

The First Circuit did leave the door open for Casper to massively narrow the scope of the case down from where Doe believed it should be tried to the very specific matter of whether BC breached its contractual obligation to Doe. This created serious issues in court, as protracted pretrial battle between Doe and BC broke out that lasted around a year. Casper ruled in favor of BC on almost all matters brought up during that battle, meaning multiple pieces of evidence were not allowed to be used, the witness list was seriously trimmed down, and the questions Doe’s representatives could ask were also severely limited. 

Despite all of BC’s legal victories during the pretrial phase, the jury still found in favor of Doe and awarded him compensation for lost salary and tuition expenses that needed to be refunded—a relative pittance compared to the $3 million Doe had originally asked for, but far more than any jury had ever awarded a plaintiff in this sort of trial. Typically, universities settle with plaintiffs or the charges are dismissed—according to Title IX chronicler K.C. Johnson, 89 such cases have been settled before a trial has even begun in such cases, and more have been settled after oral arguments took place in various cases but before final judgement was handed down in the years since the Obama administration handed down a 2011 “Dear Colleague” letter that established new Title IX guidelines. 

But now, both BC and Casper have essentially spoken out against the conduct of Doe’s representatives during the jury trial, claiming that they committed “blatant violations of the Court’s orders relating to the scope of issues, and thus the evidence and arguments properly offered at trial,” according to BC’s October brief.

In fact, BC quoted Casper directly saying during the case’s charge conference that took place on September 20 last year that “‘if there is a verdict in Mr. Doe’s favor,’ his counsel’s conduct ‘certainly gives rise to a well-founded motion for new trial, if defense intends to file such a motion, based on what they have argued about the impact of these repeated violations of my orders.”

The aforementioned well-founded motion is that the jury could not have possibly ruled in Doe’s favor based on the weight of the evidence. Based on Casper’s words, BC is saying that it has “a strong likelihood of success on its forthcoming motion.” 

Johnson confirmed that this sort of motion, as well as Casper essentially endorsing such a motion before it was filed, is extremely rare. Part of the reason it’s rare is it’s meant for parties to be able to use if a judge habitually rules against them in the pretrial process, not habitually for them as Casper did for BC in this case. 

During trial, every question Doe’s representatives posed to witnesses was objected to by BC’s counsel, and often Casper would ask Doe’s representatives to reword the question to avoid issues not covered in the reduced scope of the case. Very rarely would Casper strike a question from being asked at all, though it did happen on occasion and one in-trial sidebar was required to hash out issues stemming from a question Doe’s representatives thought needed to be asked.

This is presumably the conduct BC is referring to when it makes its argument that Casper preemptively described as “well-founded,” but given that Doe did do exactly what Casper asked and rarely asked questions that were easily dismissed as out of bounds, it’s not clear how solid BC’s case for the motion actually is.

BC hasn’t actually filed this “well-founded” motion yet, it’s just committed to doing so so that Casper would stay the awarding of damages. Casper issued the jury’s final judgement on Thursday, staying the order so that BC may file its brief and Doe’s representatives may file a response. BC’s motion is due in a month, and Doe’s response is due in two. 

What stands in BC’s way of success, though, is the First Circuit Court of Appeals. In oral arguments chronicled by Johnson two years ago, the panel overseeing the case in the appeals court at that time, which would almost certainly hear this case again if BC’s motion goes through and arrives at the appellate level, was highly critical of BC during oral arguments. It’s not clear that BC has any chance of success with that panel, regardless of whether they have the weight of evidence on their side regarding this motion, which, if successful, would require a re-trial, which would mean the case would return to district court for a third run-through.

Additionally, Rivera’s testimony was massively damaging to BC’s case and on its own might submarine the entire argument that serves as the basis for BC’s “well-founded” motion. She said she did not see Doe’s hearing as a search for the truth and that despite the panel’s final ruling saying that Doe inappropriately touched his accuser in ways she never alleged he did (she alleged that he committed sexual assault with his hands under her dress, the panel ruled that Doe had assaulted her over her clothes even though she specifically testified to how Doe touched her—Rivera said this was done because the panel wasn’t sure they believed Doe’s accuser, but that undermines the final charge since if Doe’s accuser was, in fact, unreliable that should not have ended in a decision against Doe, but in a “no finding” or “not responsible” judgement).

That testimony undermines the idea that the jury could not have possibly looked at the evidence placed before them and seen that a breach of contract was possible. In fact, that segment of the trial featured the least objections to Doe’s lines of questioning. If the First Circuit takes a look at this, it’s highly unlikely that a court that already isn’t a fan of BC’s arguments will vacate a jury decision with this evidence before the jury, even if Casper is certain that the motion is “well-founded.” 

The last note of interest is that on the same day Casper asked both sides to send in their briefs on this matter over the next couple months, it emerged that BC spent $5,261,555 in legal fees from FY2016 through FY2018. How much money BC spent on legal fees in FY2019, when this jury trial took place and the end of the pretrial battle took place, won’t be public info until about one year from now, but it’s possible BC will have spent north of $7 million dollars on legal fees since this case began—it’s not the only legal case BC has been involved in over that time, but it is certainly the one with the most developments, given how many sets of oral arguments and pretrial negotiations (three each), jury trials (one), and docket entries (202) are associated with this case at this point, meaning the vast majority of legal fees the college has paid out since 2016 and almost all of the fees paid between 2017 and 2019 have been related to this case. The exact dollar amount BC has spent on this case will never be public info since BC does not have to differentiate legal costs in one case from another on its 990 (it’s just a lump sum)—but based on the lack of other cases pending against the university and how much work BC’s representatives have had to put into this case, it’s likely that this case on it’s own could end up costing the university more than twice the amount Doe asked for at the beginning of the lawsuit, especially if this case is headed back to the First Circuit this year.

Jack Goldman is the publisher of this newsletter, as well as an independent reporter who has previously worked for The Heights and The Dorchester Reporter. In his spare time, he’s a student at Boston College.