Friday, Febuary 1, 2002 Volume 67, Issue 84



Smith admits to 'mistake' during Septimus testimony

By Ken Fountain
Senior Staff Writer

"I made a mistake," UH System Chancellor/UH President Arthur K. Smith said in reference to telling former UH assistant general
counsel Susan Septimus that a transfer to another department was contingent on her giving up the right to pursue her discrimination
and retaliation claims against her then-boss, General Counsel Dennis Duffy.

"It was never my intent to ask her to surrender her civil rights," Smith testified Thursday in the federal trial of Septimus' civil lawsuit
against the University and the UH System.

Smith said the condition of the release (which he later rescinded) was part of his effort to resolve "an impasse between two
employees, make each meet the other halfway, so that they and the University could move on."

Septimus had filed an internal complaint of gender discrimination after she was not promoted to a position of general counsel in
January 1998. She filed a second complaint of retaliation in response to a performance appraisal by Duffy, in which he said she
"exceeds expectations" but "needs to be more of a team player" and accept his authority.

Septimus' complaints joined those of two other female Office of General Counsel staff members which were investigated by Deborah
McElvaney, an outside attorney hired by the University in order to avoid a conflict of interest.

In April 1998, McElvaney submitted to Smith a 20-page report of her investigation which concluded, in part, that Duffy had
discriminated against Septimus on the basis of her gender, but that there was insufficient evidence that he had retaliated against her.

Smith testified that after reading the report, he found McElvaney's conclusions "lacking in support" and decided to appoint a committee
of three top UH administrators to evaluate it.

"I was attempting to be scrupulously fair and objective," Smith said of appointing the committee, which concluded after interviewing the
three women complainants and Duffy that there was no basis for the claims of discrimination and retaliation. But, the panel concluded,
Duffy should undergo a management training program to improve his communication skills toward subordinates.

Smith said, "I counseled (Duffy) on the need for sensitivity and compassion," and he directed him to take the training, a prospect Duffy
found "humiliating" but nonetheless "responded (to) in good faith."

Septimus was unsatisfied with this resolution. Smith testified that on May 29, 1998, he had a "somewhat awkward" meeting with
Septimus and her husband Edward Septimus. Smith said Susan Septimus, who was sobbing, "sometimes uncontrollably," told him in
no uncertain terms that she was unwilling to continue answering to Duffy.

Smith said he had hired Duffy in October 1997 with the directive to turn around the general counsel's office, which had a poor
reputation in the UH community.

"The (UH System) Board of Regents expected me to elevate that office to a higher level of accountability," Smith said.

He said his "philosophy" toward University legal offices, developed as chief executive officer of three other institutions, was that all
University legal affairs be conducted through the office of the general counsel, who is accountable to the president.

Smith said that following the May 29 meeting with Septimus, he sent her a memo offering her two options: continue to work as an
assistant general counsel under Duffy, or transfer to a "newly-redefined position" as director of contracts administration with the
stipulation that she not be able to practice law.

Asked by Septimus' attorneys if he ever considered offering her the job as it was originally envisioned, as a lawyer working in the
contracting department and answering indirectly to the General Counsel, Smith said he "would have been happy" if she would take
such a position, but assumed that she was intractable in her desire not to report to Duffy.

Smith and Septimus exchanged a series of letters in which they negotiated the terms of the transfer. In one of the letters, he told her
she must "cease and desist from this unseemly campaign" against Duffy.

While Septimus apparently believed this to be a reference to her ongoing official complaints against Duffy, Smith said he was in fact
referring to information he had received stating that she, her husband or others acting in her behalf had sent copies of the confidential
McElvaney report to a number of outsiders, including media outlets, Duffy's former employers, the University of Virginia Law School
(from which Duffy had graduated), UHS Board of Regents members Morrie Abramson and Gary Rosenthal, and U.S. District Judge
David Hittner (a friend and mentor of Septimus).

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