2020 Legislative Session

Bill to eliminate settlement confidentiality period stalled indefinitely

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Legislation aimed at eliminating a six month confidentiality period after legal settlements with the state stalled indefinitely in a Senate committee, pending changes suggested by some members. 

The Senate Judiciary Committee decided on Monday to postpone SB 64, sponsored by Republican Sen. Sander Rue of Albuquerque and Democratic Sen. Linda Trujillo until more changes to the bill are made. 

Committee Chair Joseph Cervantes said he is trying to avoid making changes in committee and suggested the sponsors take some of the recommended changes into consideration and bring it back to the committee. Concerns from other members ranged from a lack of penalties for releasing information before a settlement is made official to unclear language about when a claim with the state is considered settled. 

Sen. Daniel Ivey-Soto, D-Albuquerque, bluntly told the bills sponsors, along with General Services Department Secretary Ken Ortiz, that the bill was unclear. “Frankly, I think you’re so far in the weeds you’re not clear,” Ivey-Soto said. 

Ivey-Soto’s suggestion was that the sponsors completely strike the section of law that currently requires a confidentiality period and start from scratch. 

Just before Rue presented his bill, State Auditor Brian Colón presented a summary of his office’s findings related to 18 settlements made in the final weeks of former Gov. Susana Martinez’s time in office. Late last year Colón’s office conducted an audit of those settlements and found “abuse of power” and wrongdoing by the Martinez administration. 

The Martinez settlements’ three year confidentiality period went well beyond 180 days. Some committee members said they were concerned that Rue and Trujillo’s bill did not do enough to prevent a confidentiality period being written into the terms of a settlement. 

Regardless of Cervantes’ hesitation to pass the bill along as-is, he said he was frustrated with the revelations of the Martinez settlements.

15-7-9

State Auditor: Secret payouts were ‘about abuse of power’

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In a press conference Monday, New Mexico State Auditor Brian Colón announced his office’s findings regarding multiple secret payouts approved by former Gov. Susana Martinez’s administration. Colón said he was “disappointed” and “disgusted” with the way the Martinez administration handled 18 confidential legal settlements totalling $5 million in taxpayer money. The payouts were in response to a lawsuit filed against Martinez and her former chief of police, alleging workplace harrasment and discrimination.   

“This is about abuse of power, a lack of transparency, and particularly as it relates to political appointees by our former governor,” Colón said. 

The Martinez administration finalized the settlements in question just before she left office and approved by a cabinet secretary she appointed. News stories about the settlement highlighted not only a mysterious audio recording that reportedly contained a conversation between Martinez and her husband, but also an unusually long confidentiality period. 

But state law still allows settlements like these to remain confidential for 180 days. Colón said he’d like to see a change in that law. 

“I look forward to standing at the Legislature and explaining to them if we’re going to restore people’s trust in government, we have to change the confidentiality agreement, period,” Colón said.    

Colón is not the first official to call for a revamp of the state’s confidentiality law for legal settlements.

Risk Management Division

Legal costs, impact on women often overlooked in lawsuits

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When a state agency settles a lawsuit, often times the public’s focus is on how much money the state settled for. But an often overlooked portion of legal battles with state agencies is how much the state paid for legal representation. 

Since former Gov. Susana Martinez left office nine months ago, there have been a number of news reports about settlement payouts to a handful of former state employees for alleged workplace discrimination. Often, public scrutiny is aimed at the plaintiffs. In a high profile settlement involving former Department of Public Safety employees, New Mexico’s former State Police Chief, who was accused of sexual harassment, called the claims from his former employees baseless and accused them of extorting money from tax payers. But lawyers from two different lawsuits covered extensively by NM Political Report argue that there should be more focus on how much the state pays for long, drawn-out legal defenses to ultimately settle for hundreds of thousands of dollars, specifically when women are the accusers. 

 ‘It’s going to be like a proctology exam’

In December 2017, less than a month after the University of New Mexico Health Sciences Center agreed to cut a jury trial short and settle with a former medical resident, Anesthesiology Chair Hugh Martin broke some bad news to his faculty—they would not be getting bonuses that year. 

“I regret to inform the faculty that due to the recent legal settlement with the former dismissed problem resident, Cyndi Herald, that the Department had to reallocate the monies I had planned to use for a retention bonus to pay the settlement legal costs to Ms. Herald/Attorney Lisa Curtis,” Martin wrote. 

The “problem resident” Martin referred to, Cynthia Herald, had spent years in a legal battle with her former employer.

15-7-9

NM cabinet secretary wants to address secret settlements

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A New Mexico law that allows legal settlements with state agencies to be kept a secret for at least six months may get a makeover in the next legislative session. 

General Services Department Secretary Ken Ortiz told NM Political Report his office, which oversees the state’s Risk Management Division, is in the process of creating a working group to address a relatively unknown statute that mandates settlements stay secret for 180 days. The same law that established the Risk Management Division, which often serves as the state’s de facto insurance provider, contains a “confidentiality of records” section, which is often referred to by its citation number 15-7-9 as legal shorthand. 

That section of the statute is less than 300 words and is ambiguous about exactly when the 180 days starts. There are four instances in which the law says the clock starts ticking: when “all statutes of limitation applicable to the claim have run,” when litigation is done, when the “claim” is settled or when the claim is in “closed status.”

Ortiz said previous claims filed with Risk Management were sometimes never put into closed status, simply because someone failed to close it in division’s computer system. 

“I wanted to take the human element out of 15-7-9,” Ortiz said. 

The failure to “physically click on a button,” Ortiz said, would sometimes delay the start of the 180 days by an extra six months. 

“What we’ve seen when we reviewed settlements is, for whatever reason, it took several months after the final action on that case for the staff to administratively close it,” Ortiz said. 

That means a 180-day confidentiality period could easily run for more than a year.  Last year, for example, the New Mexico Corrections Department settled a lawsuit with six women who sued the state, claiming they were sexual assaulted and harassed by their superiors. That case was settled in January 2018, but GSD’s lawyer at the time said claims were not complete until all of the state’s legal bills were paid, which did not happen until six months after the case was dismissed. 

Now Ortiz said he’s working with the governor’s office and lawmakers to better define when the confidentiality period starts, and possibly address whether it should even be 180 days.  

Mr. Ortiz goes to the Legislature

Ortiz said he was aware of the confidentiality period before he took the job as cabinet secretary, but was not fully aware of the issues it presented until he started getting calls from news reporters—this one included—about settlements. 

“We thought, ‘This is truly tax payer money and people have a right to know,’” Ortiz said. 

Ortiz said conversations about transparency also came up when State Sen. Sander Rue, R-Albuquerque, and State Rep. Linda Trujillo, D-Santa Fe, introduced a bill that would require the state to post the specifics of all human rights settlements online. Ortiz said he wants to include the two lawmakers in crafting legislation to address the issue.