Donita Rotherham and the American Red Cross were in court for the first time this month since Rotherham filed a wrongful termination lawsuit against the organization last June.
The Red Cross is denying Rotherham's allegations that it used her as a scapegoat when both the local chapter and national organization were under intense public scrutiny for their handling of the January 2001 Alpine fire and the Liberty Fund established for victims of the Sept. 11, 2001 terrorist attacks.
In a recent response to Rotherham's complaint, the Red Cross acknowledged that it experienced growth during her 18-year leadership of the local chapter, but said there was insufficient evidence to admit or deny Rotherham's assertion that she received glowing performance reviews year after year.
The Red Cross also denied that it leaked an audit report to the media in order to orchestrate a public outcry over the chapter's response to the fire and create a pretext for firing Rotherham, as her lawsuit alleges. Rotherham's complaint said the organization spent hundreds of thousands of dollars and possibly more than $1 million to destroy the independence of the local chapter, disband its leadership and disparage Rotherham's reputation in the community. The Red Cross denies this allegation as well.
The parties and their attorneys met Dec. 3 in Magistrate Judge Leo Papas' chambers for an "early neutral evaluation conference," designed to determine whether the case is a candidate for alternative dispute resolution. A prior attempt at mediation failed.
A settlement seems unlikely in this case, according to Mary Dollarhide, a partner with the San Diego office of Paul Hastings Janofsky & Walker, who was recently hired to represent the Red Cross. Rotherham's attorney Paul Kondrick believes a settlement is still on the table, given how much it could cost the Red Cross to defend the lawsuit.
Neither side could discuss what happened in Papas' chambers. However, Papas met with all parties collectively and also met privately with each side.
"They feel confident in their position and we feel confident in our position," said Kondrick. "That's what horse races are made of."
Rotherham was chief executive of the local chapter for 18 years and was employed by the organization for more than 31 years. She was fired in June 2002 after the Red Cross conducted an audit that found funds raised following the Alpine fire were not properly spent on victims.
Her amended complaint filed in October accuses national Red Cross officials of repeatedly stating that Rotherham should "take a bullet for the organization," which was under intense scrutiny. Alleged misrepresentations made by Red Cross officials regarding Rotherham's handling of funds donated for fire victims subjected Rotherham to "extreme and unfair" criticism from the media and community, according to the lawsuit.
Rotherham is seeking more than $2 million in damages, including $1 million for the loss of salary, bonuses, deferred compensation and other employment benefits, and $1 million for loss of reputation.