Neither the plaintiffs nor the defendants in an ongoing lawsuit against multiple current and former city officials in connection with the Eureka Springs CityAdvertising and Promotion Commission have discussed the case publicly. That changed on Thursday, Oct. 20, at a candidate forum presented by the Eureka Springs Chamber of Commerce.
Meanwhile, a trial in the suit has been scheduled for the final week of November and the first week of December 2023.
Mayoral candidate Tracy Johnson, a former events coordinator for the CAPC who is among the plaintiffs in the lawsuit, responded at the candidate forum to a question shouted from the audience about the lawsuit.
“That is actually leading into what I would say,” Johnson said during the one-minute time she was allotted to describe what she believes is the most important issue she’d like to address as mayor. “Transparency, and a government that follows a code of ethics and the law, is utmost of importance to me. If someone is employed by a politician and is suing him for a severe wrongdoing, why would she be disqualified from running for office when she herself knows that he is unfit to do so? She personally knows of the wrongdoing he’s done. So the real question should be: Why do we want to re-elect officials that continually act unethically and in a manner that brings multiple lawsuits against the city? … Let’s deal with the issue and the people that can’t behave according to the law. They represent us, the community. And a lawsuit is an appropriate step in the judicial system when people who should take care of things in a manner that is appropriate do not. It is not up to me to handle these matters on my own. It is up to me to let the judicial system run its place. So transparency in government and power back to the people is absolutely something I very firmly believe in.”
Johnson is running against Mayor Butch Berry, a defendant in the lawsuit. Berry has not commented on the suit in public.
Another defendant, city council member and former CAPC commissioner Harry Meyer, responded to Johnson’s comments at the Oct. 20 forum, saying in so many words that because the complaint was filed as a civil matter, rather than a criminal one, it is clearly without merit. Meyer is running unopposed for re-election to the city council.
“Since I’m one of the people that’s being sued by some people here in town, along with the city, for $37 million, I think that if you’re going to civil court, that means you can’t take me to criminal court, because we haven’t broken any laws,” Meyer said in response to a question about what his top priority would be as a council member and how he would work to bring people together. “There is no damages. They’re just doing this because they lost their positions. It’s ridiculous.”
Eureka Springs attorney Tim Parker filed the original lawsuit in March 2021. It has since been amended. Parker represents Johnson, former CAPC interim director Gina Rambo, former finance director Rick Bright, former group sales coordinator Karen Pryor and former commissioner Greg Moon.
Defendants in the suit are Berry; his administrative assistant Kim Stryker; CAPC chairman Jeff Carter; commissioner Patrick Burnett; former commissioners and current city council members Meyer and Melissa Greene; former commissioners James DeVito and Carol Wright; former executive director Lacey Ekberg; the city; and an insurance company that provides a policy to the city.
NEW DEVELOPMENTS
In an order dated Friday, Oct. 21, Carroll County Circuit Judge Scott Jackson sets deadlines for discovery and depositions in the case as well as a trial date.
“Trial in this case is set for the two (2) week period beginning the last week of November through the first week of December 2023,” Jackson’s order says.
Arkansas Municipal League attorney Amanda LaFever, who represents the defendants, filed a response on behalf of Ekberg dated Oct. 19. Ekberg, who has been working in South Carolina under the name “Lacey Deeds” was added as a defendant in the suit on June 2 but was not served until Sept. 19 because process servers were unable to locate her in Tennessee — where she worked as Lacey Deeds for about a year — or in Florida, where she owns a home.
Also last week, an attorney representing a state auditor filed a motion for a protective order after Parker issued a subpoena seeking communications or documents concerning allegations of financial improprieties by CAPC employees from 2018 to 2022. Internal emails from the Arkansas Division of Legislative Audit obtained by the Lovely County Citizen document the fact that Berry contacted auditors about issues related to the CAPC, “including possible overpayments to the former Events Coordinator (payroll and the individual’s private events company) as well as other ethics concerns.”
In a deposition taken in February, Berry was asked by Parker if he had ever told anyone that Johnson had embezzled money or property from the city.
“No, sir,” Berry replied. In a brief filed in support of the motion for a protective order regarding Parker’s subpoena to Legislative Audit, attorney D. Franklin Arey III writes that the division is currently auditing the city of Eureka Springs for 2021 and that “fraud interviews” of some city officials and employees have been completed. The final audit report is expected to be completed sometime in 2023,Arey writes.
Arey argues that information gathered in fraud interviews is confidential under state law.
“Fraud interviews are not available to the public, even after an entity’s audit report has been issued,” Arey writes.
“I think that if you’re going to civil court, that means you can’t take me to criminal court, because we haven’t broken any laws.”
— Harry Meyer
