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Fired, but Firing Back, Over Dealings in Washington By THEO EMERY Published: December 25, 2012 WASHINGTON — Eric W. Payne’s world has shrunk. The man who oversaw millions of dollars in city contracts today watches every dime in his family budget. He has not worked full time since 2009. He and his family were evicted last summer, and now their lives spill from boxes in a cramped town house in suburban Virginia. But this is not a typical hard-luck story of setback amid a recession. Since he was fired almost four years ago, Mr. Payne, 41, has been locked in a bitter dispute with the city’s chief financial officer, Natwar M. Gandhi, his former boss and one of the most powerful unelected officials in Washington. Mr. Payne asserted in a lawsuit filed in 2010 that he was fired for drawing attention to misconduct in city contracting; Mr. Gandhi has countered by calling him a disgruntled employee. At least one federal criminal investigation has sprung directly from concerns that Mr. Payne says he raised when he was a contracting officer and included in a lawsuit over his dismissal. The Securities and Exchange Commission is investigating Mr. Gandhi’s office as well. The legal feud has taken an unusually personal tone. In a second lawsuit, Mr. Payne accused Mr. Gandhi of defaming him in public statements and in private e-mail circulated to business leaders, preventing him from finding new work. “The uncomfortable questions I’ve raised have made it difficult for district officials to continue those practices,” Mr. Payne said. “This feels like a measure of retribution.” Mr. Payne was fired, he has said, for resisting efforts by city officials, including Mayor Vincent C. Gray and at least one City Council member, to scrap a $38 million lottery contract with the winning bidder. The fight has played out in the footlights of another scandal: an inquiry into Mr. Gray’s 2010 election, which has been tainted by revelations that a wealthy supporter bankrolled an off-the-books “shadow campaign.” In unrelated scandals, two City Council members resigned this year after one pleaded guilty to bank fraud and the other to theft. Mr. Payne has been something of a voice in the wilderness as intrigue has swirled around the mayor and the Council. But his accusations about misconduct in the lottery contracting process have gained attention recently as new controversies have emerged over Mr. Gandhi’s stewardship of his office. In October, his internal affairs chief, William J. DiVello, abruptly stepped down over what he said was pressure to shield internal audits from public view. The S.E.C. is investigating. Mr. Gandhi’s office denies that such a policy exists. In early December, Mr. Gandhi faced blunt questions at a tense City Council committee hearing that touched on his dispute with Mr. Payne. A former council member, William P. Lightfoot, called Mr. Payne’s account “a story about villains and a hero.” “I think Mr. Payne spoke truth to power, and power decided they were going to crush him,” he said. “It’s just that simple.” Council members who sought a public airing of the circumstances around Mr. Payne’s firing left disappointed. Mr. Gandhi sat silently as his lawyer told frustrated council members he could not discuss the case because of the litigation. Jack Evans, a council member and chairman of the finance committee, said: “Someone is going to explain to this committee what happened. We can do it today, we can do it next week, we can do it next month, but at some point, someone is going to explain.” A spokesman for Mr. Gandhi declined an interview request. Mr. Gandhi is considered the guardian of Washington’s treasury, a position created during the city’s near-insolvency in the 1990s. But his credibility was damaged several years ago after Harriette M. Walters, a manager in the city tax office, pleaded guilty to stealing $48 million, raising questions about oversight in his office. A former appointee in the Clinton White House, Mr. Payne was hired as a lawyer in Mr. Gandhi’s office before becoming chief contract officer in 2006. In 2008, Mr. Payne’s duties included the ticklish task of rebidding the city’s lottery contract. Elected officials sometimes exerted pressure on behalf of contractors, according to Mr. Payne’s predecessor, Mike Wooten. In early 2009, despite glowing performance reviews, Mr. Payne was dismissed. He filed suit, claiming that he had been pressured to remove a disfavored minority partner from the winning lottery consortium because of council members’ objections, and that he resisted that pressure. “If the chief procurement officer tries to act with integrity and it goes against the political interests of the district, that person’s out of a job,” Mr. Wooten said. “Ultimately Eric Payne was forced out, and I believe it was because he tried to hold with integrity to the lottery contract.” The case has proved to be a Pandora’s box of sorts, exposing what critics have called pay-to-play politics. In recent months, Mr. Gandhi’s office has attracted scrutiny as sealed court documents have trickled out to the news media. This month, The Washington Post and other newspapers published a draft of a report that exonerated Mr. Payne of wrongdoing while sharply criticizing a City Council member, Jim Graham, who has been in the lottery scandal’s spotlight because of his objections to the minority partner in the winning lottery bid. The document, which had been under seal, gave new credence to Mr. Payne’s assertions that Mr. Graham was among those who tried to improperly meddle with the lottery contract. Mr. Graham strongly denies that he did anything illegal. But the acrimony has taken a deeply personal turn. Mr. Gandhi subpoenaed businesses where Mr. Payne applied for jobs and his past employers, former President Bill Clinton among them. Lawyers for Mr. Gandhi also questioned Mr. Payne’s doctors about his medical history and tried to depose his pregnant wife. Over the summer, Mr. Gandhi forwarded a letter to the Chamber of Commerce saying Mr. Payne was fired because of “poor performance issues.” He was also sharply critical of Mr. Payne in an interview with The Washington Post, saying he was “nasty to people” and “rude to outsiders.” Mr. Payne sued for defamation. In an unusual move, the city invoked a law intended to shield defendants from frivolous lawsuits, calling Mr. Payne’s defamation lawsuit “an improper and meritless action to garner publicity.” Such laws, known as “Slapp suits,” are written to protect citizens from legal intimidation and are rare in employment cases, according to legal experts. If the city’s move is successful, Mr. Payne could be required to pay all of the city’s court costs. Mr. Payne jokes that even bill collectors have stopped calling. Still, he is undaunted, saying even as he faces the possibility of being forced to pay the city’s legal tab that “it’s worth it for me in order for the truth to prevail.” “As a parent, I tell my children that you always do the right thing in spite of the daunting odds or even the potential dire consequences,” he added. “There’s nothing more important to me than my integrity and my professional reputation.” |