A former St. Paul employee who was a recent finalist for a department director job has sued the city in U.S. District Court, alleging retaliation, an unfair hiring process and violation of equal protection rights.

Edward McDonald is seeking a jury trial to show that the city didn't follow its own rules for hiring a director of the Human Rights and Equal Economic Opportunity department.

The city and Mayor Chris Coleman are named as defendants.

"The allegations are without merit, and we look forward to defending the city's position in this dispute," said Portia Hampton-Flowers, supervising attorney of the city's litigation division.

In the complaint, which was filed this week, McDonald says he was subjected to things other candidates weren't, such as questions regarding his past employment with the city and subsequent firing.

McDonald was ranked third on a list of candidates submitted by a community panel to Mayor Chris Coleman for the position of director of the newly formed Human Rights and Equal Economic Opportunity department. The first two candidates were offered the job but declined to take it, according to the court document. Instead of getting a job offer, McDonald was bypassed.

Coleman appointed a former aide, Luz Maria Frias, to the post. McDonald contends in the lawsuit that Frias previously applied for the position and was not selected as a finalist, thus didn't go through the community vetting process required of the top three candidates.

McDonald is seeking unspecified punitive and compensatory damages, as well as requiring the city to "cease and desist from all conduct, now and in the future, that is based on the protected activities of an individual."

"We're trying to get the city to clean up its act," said Michael Fondungallah, an attorney representing McDonald. "We want the court to find the city didn't follow its own rules."

It's not the first time McDonald has taken the city to court.

Hired in 2002, McDonald filed a federal whistle-blower lawsuit in 2003, arguing that he lost his job for trying to hold the city accountable in hiring more women- and minority-owned contractors.

He was appointed by former Mayor Randy Kelly to lead the city's minority business development initiative and was responsible for helping the city to correct past discrimination by including more minority groups in economic development projects.

In 2004, the city and McDonald agreed to an $82,500 settlement. The city admitted no wrongdoing in the firing, and the court didn't require it to make any adjustments to its minority contract procedures.

A 2007 audit found that less than 7 percent of $220 million worth of contracts in 2006 went to minority- and female-owned businesses. Lack of accountability, communication and resources were the main problems, the audit said.

To address those problems, the new Human Rights and Equal Economic Opportunity Department was created to combine several functions, from civil rights enforcement to workforce development. Its 2009 budget is about $4.7 million.

Chris Havens • 612-673-4148