School district, former superintendent reach deal

'Defrauded district of millions of dollars'

INDIANAPOLIS - The Metropolitan School District of Wayne Township and its former superintendent, Terry Thompson, have reached a settlement agreement in a dispute that’s been brewing since January 2011.

After receiving an anonymous letter in the mail, Call 6 Investigator Kara Kenney exposed Thompson’s $1 million retirement payout and his $1,350-a-day consulting job with the district.

Months later, in November 2011, the school board sued Thompson, alleging he crafted an “elaborate, complex and deceitful scheme” to “defraud the district of millions of dollars in salary and compensation.”

The district alleged that Thompson, through his attorneys, used multiple complex contractual changes that were never discussed with or explained to board members to increase his annual salary from $218,000 in 2003 to $2.2 million in 2010, causing his retirement benefits to jump dramatically.

The district claimed Thompson lied to board members, assuring them that he had made only minor revisions to his contract, while falsely telling his attorneys that certain elements had received board approval.

Thompson filed a counter claim, saying the district still owes him for unpaid salary, post-retirement contributions, deferred compensation and severance pay.

In statements released Tuesday, both sides announced they’ve agreed to settle their dispute. You can read the settlement in its entirety here.

Thompson will dismiss his claims for additional compensation, and in return, the district agreed to dismiss claims for Thompson’s return of other compensation already paid.

A representative for MSD Wayne Township declined to comment further, citing the agreement’s confidentiality clause, but it appears Thompson will keep his retirement payout, as long as he does not seek future benefits from the district.

“The district is confident it has gained more with this settlement than it would by incurring the additional legal expense required to pursue this lawsuit,” read a statement released to RTV6 Tuesday. “The settlement agreement also allows MSD Wayne to continue to focus on its most important work -- educating the children of Wayne Township and providing multiple pathways for their success.”

Attorneys for Terry Thompson also declined to speak on camera with Call 6 Investigator Kara Kenney, but released a statement, saying Thompson the resolution was acceptable to Dr. Thompson before the lawsuit was filed by the board.

“Dr. Thompson is proud of the leadership he provided to the school district and of the success achieved by the district’s students and teachers,” read the statement. “Dr. Thompson regrets that the school district elected to institute litigation and is pleased that the district to which he devoted his time and energy will now focus on its appropriate mission.”

On Tuesday, Call 6 Investigator Kara Kenney requested total legal bills paid by MSD Wayne for the Terry Thompson situation. Spokeswoman Mary Lang said the district paid $72,870 to Lee McTurnan, $132,996.77 to Bingham McHale and $354,647 to Pence Hensel for a total of $560,513.77.

As Call 6 Investigators reported in 2012, law firm Bose, McKinney and Evans reimbursed the school district $435,000 for legal fees the district incurred for the Thompson investigation and lawsuit.

Jon Bailey of Bose, McKinney and Evans, the school district’s attorney at the time, signed off on Thompson’s contract, saying he was looking for legal implications, not financial.

The school district later fired Bailey.

Taxpayers Kenney spoke with say the lawsuit filed by the board against Thompson was a waste of taxpayer money.

Thompson’s retirement payout resulted in a new state law that requires more transparency in superintendent contracts, yet many school districts aren’t following that law.

Over the past two and a half years, Thompson has declined Kenney’s requests to speak on camera.

The settlement agreement now prohibits Thompson and MSD Wayne Township board members from speaking to the media about the agreement.

Thompson currently owns homes in Carmel and Naples, Fla.


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