Farmington has agreed to pay $23,000 to avoid a lawsuit over the departure of former Finance Director Teresa Walters, who quit abruptly in early June.
The city will pay $10,000 and the balance will be covered by its insurer, the League of Minnesota Cities Insurance Trust, said Mayor Todd Larson. The agreement includes $3,000 in fees for Walters' attorney, John Fabian. Fabian didn't return a phone call.
Farmington City Attorney Joel Jamnik said in a letter to the city that Walters' possible claims included one covered by the state's whistleblower statute. Jamnik said he and the League Trust recommended the settlement to avoid litigation costs and the "possible ramifications to all of the parties depending on the various outcomes" should the matter go to court.
Larson said the separation agreement forbids city officials from talking about why Walters left, and whether the whistleblower or other claims were frivolous.
"I'd love to give you my opinion on it but I can't," Larson said. "Unfortunately, that is the way life is. People threaten to sue ... Anyone can sue anyone, and the quickest and usually cheapest way is to settle it."
"It's the path of least expense," said Council Member Jason Bartholomay. "The city is not saying it did or didn't happen."
The settlement agreement lists potential claims that Walters will not pursue, including severance pay, wrongful termination, defamation, intentional or negligent infliction of emotional distress and age, civil or human rights claims.
The agreement also says the city will remove and retain in a confidential file all performance evaluations in Walter's official personnel file except for one dated Sept. 14, 2010.