Former Canton McKinley football coaches sue insurance company, attorney, and superintendent over fraudulent $125,000 settlement paid to alleged “pork-residue victim”

Yesterday, former Canton McKinley football coaches Marcus Wattley, Frank McLeod, Zack Sweat, Romero Harris, Cade Brodie, and Tyler Thatcher filed suit against the Liberty Mutual insurance company, attorney Kathryn Perrico, and Canton City Schools superintendent Jeffrey Talbert over defendants’ unlawful conduct in orchestrating and authorizing a fraudulent settlement payment of $125,000 to a student who had falsely accused the coaches of forcing him to eat portions of a pepperoni pizza with intent to violate the student’s alleged Hebrew Israelite religious beliefs that prohibited consumption of pork.

The student’s accusations about this shocking act of anti-Semitic abuse made national and international headlines in June of 2021—including in the New York Times, Washington Post, ESPN.com, the Daily Mail, and the Jerusalem Post—after the student’s attorney, Edward Gilbert, held a press conference in which he stated that the coaches “knew of [the player’s alleged religious] beliefs and wanted to punish him” by “intentionally” forcing him to eat portions of a pepperoni pizza. “Although the coaches allowed the player to remove the pepperoni after he reiterated his beliefs,” Gilbert told the New York Times, “pork residue remained on the pizza.” Gilbert later told news reporters that “this was a punitive act on the part of the coaches, an act that was deplorable and was designed to psychologically injure this child and we have now submitted this matter to the US Attorney as a possible hate crime.”

These globally publicized accusations against the coaches were immediately proven to be not only false and defamatory, but wildly so, including by the alleged victim’s own admission that the coaches did not even know about his alleged religious beliefs, and would have had no reason to know about them.

Thus, the Stark County judge presiding over the related defamation lawsuit filed by the coaches had ruled that the coaches were entitled to have a jury resolve their claims against Gilbert and his clients. These claims were based on proven allegations that Gilbert and his clients knew there was no evidence to support their accusations that the coaches intentionally violated the player’s religious beliefs, or that would otherwise sustain a viable lawsuit based on the events at issue, but fabricated these accusations to sustain a claim that the player’s constitutional rights were violated, and to create sensational press coverage that would aid them in extorting a settlement from the school district.

By contrast, the federal claims that Gilbert and his clients later filed against the coaches, alleging violation of the player’s constitutional right to freely exercise his religious beliefs, were dismissed on the pleadings, and the only claim the federal court allowed to proceed past the pleadings stage was a “Monell” claim against the district that had no basis in law or fact and was conclusively proven meritless based on the same evidence that warranted a jury trial in the coaches’ defamation case. In particular, it is black-letter law both that no “Monell” claim can proceed without an underlying constitutional violation, and that there can be no claim of a constitutional violation without proof that the violation was intentional. See, e.g., Robertson v. Lucas, 753 F.3d 606, 622 (6th Cir. 2014) (“There can be no liability under Monell without an underlying constitutional violation.”); Ahlers v. Schebil, 188 F.3d 365, 373 (6th Cir.1999) (“A successful § 1983 claimant must establish that the defendant acted knowingly or intentionally to violate his or her constitutional rights, such that mere negligence or recklessness is insufficient.”). In granting the coaches’ motion for judgment on the pleadings, the federal court held that Gilbert and his clients “failed to meet even the modest notice pleading standard applicable to their claims,” and failed to “assert any facts that would support” a finding that the coaches had engaged in “a premeditated, calculated effort … to embarrass and traumatize” the player. Additionally, due to the extensive discovery that had been taken in the coaches’ defamation suit, the judge presiding over the federal case had ruled that no additional discovery would be taken in that case.

Despite these facts, and that Gilbert’s sham federal suit was accordingly hanging by a thread, subject to certain dismissal on a motion for summary judgment that wouldn’t have taken more than a few thousand dollars in legal fees to complete, the District agreed to pay Gilbert and his clients an exorbitant $125,000 settlement to resolve their meritless claims.

As the coaches allege in their newly filed lawsuit, this settlement was the result of unlawful collusion between the District and Gilbert, and was not based on any reasonable assessment of Gilbert’s claims but was rather specifically intended to defraud the public, further defame the coaches, and vindicate the District’s position in the public eye and in the coaches’ defamation suit where they too remained defendants based on allegations that they intentionally misrepresented the results of their investigation of the false accusations as a pretext to justify their controversial and selfishly motivated decision to terminate the coaches. Shockingly, this $125,000 settlement that was reached on June 22, 2023 was nearly double Gilbert’s most recent demand of $71,500 that he had submitted on April 10, 2023.

The coaches also allege that Liberty Mutual, who insured the coaches and the district officials on both sides of each lawsuit under the same policy, failed to screen for obvious conflicts of interest and breached its duty of good faith to the coaches in authorizing the collusive sham settlement. These allegations are based in part on testimony the coaches obtained from Liberty Mutual “claims specialist” Kari Finnegan, who affirmed that she relied entirely on Perrico’s conflicted advice in approving the settlement, did so with no regard for the sharp conflicts of interest at issue in the case, and did not make any meaningful independent assessment of Perrico’s opinions on the merits of the settlement. Despite provisions requiring the insureds’ consent to any settlements paid under the policy, Liberty did not obtain the coaches’ consent to this settlement, and did not even provide them with notice of the impending settlement before it was reached, instead permitting Perrico and the District to bind the coaches to the settlement without giving them any say in the matter. Liberty permitted Attorney Perrico to represent Talbert and the District in the federal lawsuit despite her own conflicted position in the coaches’ defamation suit, wherein the coaches took specific issue with her advice and actions on behalf of Talbert and the district. Not only did Perrico’s conflicted actions in orchestrating this settlement benefit Talbert and the District to the direct detriment of the coaches in the defamation case and in the public’s eye, they also benefited her personally, vindicating her advice and actions that were at issue in the defamation case, and benefiting her personal interest in her business relationship with the District’s board members and superintendent. Perrico even went so far as to file a “stipulated motion for dismissal with prejudice” on behalf of “all defendants” in the federal suit, misrepresenting to the court that the coaches agreed to the settlement, despite that she did not represent the coaches nor could have due to the conflicts-of-interest that required Liberty to appoint separate counsel to the coaches in the federal suit. The coaches allege that these actions constitute a bad faith breach of Liberty Mutual’s duties to them as insureds under Liberty’s policy, and violate the basic principle of Ohio law that “all settlement agreements in Ohio must be free from collusion.” Hodesh v. Korelitz, 123 Ohio St.3d 72, 2009-Ohio-4220, 914 N.E.2d 186, ¶ 9. The coaches further allege that Perrico’s and Talbert’s deceptive and collusive actions in orchestrating this sham settlement constitute tortious interference with the coaches’ rights under the insurance policy.

“Perrico’s and Talbert’s actions in orchestrating this settlement constitute an egregious fraud on the public that strikes at the basic integrity of our legal system,” said Peter Pattakos, attorney for the coaches. Pattakos added: “There was no conceivable factual or legal basis for Gilbert’s ridiculous ‘pork-residue’ lawsuit to survive a motion for summary judgment, and that motion could have been put together in a few hours based on the substantial work we had already done for the coaches in proving the meritlessness of these claims. The notion that any substantial settlement would be paid on such demonstrably false accusations is absurd enough, but to pay such a settlement after the Stark County court had ruled that evidence demonstrating the falsity of these accusations supported an actionable defamation claim against Gilbert and his clients is beyond the pale, and leaves no doubt as to Perrico’s and Talbert’s intent to harm the coaches and mislead the public. It’s also shocking that an insurance company of Liberty Mutual’s stature would have allowed itself to be manipulated by an obviously conflicted attorney into approving such an obviously collusive and baseless settlement but thankfully Ohio law provides strong remedies to insured parties whose rights under insurance policies are violated in the manner at issue here. Above all else, this case offers an especially telling demonstration of the absurdities that tend to unfold when public officials try to hide the truth from the public and continue to pile lies on top of lies to avoid admitting and accounting for their mistakes. Imagine if the District officials had simply been the ‘adults in the room’ that they were supposed to be in the first place and given Gilbert’s and his clients’ obviously false accusations the treatment they deserved, instead of using them as an excuse to hand the McKinley football program over to their friend who couldn’t otherwise earn the job on the merits. Not only would the community be better off today due to the continuation of the excellent work that Marcus Wattley and his staff were doing, so would the alleged victim of the pizza incident, and the whole world could have avoided this whole shameful spectacle whereby exemplary coaches and community servants were punished and then continually tarred in public’s eye for having tried too hard to help a kid that any other coach would have kicked off the team. We remain proud to seek justice for these coaches and ensure that the truth of this matter is known and learned from in the end.”

The coaches’ newly filed lawsuit is pending in the Summit County Court of Common Pleas (CV-2024-06-2712) with Judge Alison Breaux presiding. A copy of the filed complaint is available here. For more information about this case, see here.