Profit companies

Whistleblower’s 9-year lawsuit against Pennsylvania Central Corporation executives and directors has been settled

WILLIAMSPORT — A nine-year-old whistleblower’s lawsuit against the officers and directors of a nonprofit corporation of which the late U.S. Representative Allen E. Ertel was director was settled on the eve of the trial.

The terms of the settlement reached Friday in a lawsuit brought by Maria Casey, former in-house counsel for Firetree Ltd. in Williamsport, were not disclosed.

“We are pleased that the long ordeal has come to a resolution without the need for a trial,” his attorney James J. Rodgers said Sunday.

A jury had already been chosen for the trial which was due to begin in Lycoming County Court on Monday with a visiting senior judge presiding.

Casey filed a lawsuit in 2013, claiming she was fired for providing financial documents to the state attorney general’s office, which resulted in an investigation into Firetree that Ertel helped establish in 1991.

Most of the documents in the case were sealed despite the efforts of Casey, who is clerk of the Schuylkill County Courts, to have them unsealed.

The state’s Superior Court upheld Potter County Senior Judge John Leete’s decision to keep most of the court record sealed.

Rodgers said two years ago his client was upset that the documents had been sealed because it hid from public scrutiny evidence of alleged misconduct by Firetree executives. There was no compelling reason for the sealing, which Rodgers said “frustrates the principle of open courts and the right of the press to access matters of public interest under the First Amendment.”

Documents that were not sealed included Casey’s assertion to Ertel and Firetree chairman William C. Brown about alleged improprieties.

The defendants are Ertel’s estate, his widow Catherine, his son Edward and his daughter Amy and Brown. They allege that Casey violated Pennsylvania’s Rule of Professional Conduct by disclosing confidential information about the organization to the Attorney General.

Casey’s lawsuit was related to one that then-Attorney General Kathleen G. Kane filed in 2013 accusing Firetree and related entities of violating the Nonprofit Corporations Act and the the solicitation of funds for charitable purposes.

That Commonwealth Court case was settled last June with Firetree agreeing to transfer nearly $21.8 million in assets to the First Community Foundation Partnership of Pennsylvania in Williamsport.

Firetree Place, a licensed nonprofit facility in Williamsport for young people whose lives have been affected by drugs or incarceration, will receive $40,000 a month from these funds, with the amount to be adjusted annually based on the ‘consumer price index.

Use of other Firetree funds is limited to registered charities or nonprofits whose mission is to serve people whose lives have been affected by addiction, drug use, incarceration and related circumstances. .

Distribution is limited to certain counties in Pennsylvania, including Cumberland, Dauphin, Lancaster and Lebanon.

The allegations the Attorney General made against Firetree in this case included:

  • The individual defendants received significant financial benefits through transactions between the nonprofit organizations and the businesses they owned or operated.
  • Funds were regularly transferred between the nonprofit organizations, although they had different missions.
  • New foundations that provide adoption and foster care services in Philadelphia paid Firetree $144,000 per year for management services, although Firetree’s mission does not provide such services.

Firetree was established in 1990 in Williamsport by Ertel and Brown, a Lycoming County businessman, to provide transitional services to people in the criminal justice system.

Today, he operates a number of halfway houses, including the Capitol Pavilion in Harrisburg and drug and alcohol addiction facilities such as Conewago Place in Hummelstown.

Ertel, a Democrat who served three terms in Congress and unsuccessfully ran for governor in 1982 and attorney general in 1984, died suddenly on November 19, 2015.


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