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It can be tough trying to advance good government while simultaneously balancing D.C.’s legal interests. And Attorney General Karl Racine’s challenge to do just that is on display in a bid protest recently filed in Superior Court by former D.C. Public Schools food services director-turned-whistleblower Jeff Mills, who has already prevailed in legal actions that the District could have avoided.
In this and other cases—notably that of lottery whistleblower Eric Payne, who prevailed in federal court in November and finally received a settlement deal with the city—Racine’s office has tilted toward the pursuit of legal victory despite inconvenient facts that point to poor public policy. Mills’ protest may be the next albatross around the AG’s neck.
Mills was the hard-charging head of an outsourced program who exposed fraud and poor quality food service by multinational provider Chartwells and a local contractor who became cozy with former Chancellor Kaya Henderson. Predictably, DCPS fired him for speaking out, then had to cough up $450,000 in a wrongful termination lawsuit.
Mills then filed a lawsuit against Chartwells and its partner, Thompson Hospitality Group, that resulted in a $19 million settlement for the District. For his trouble, Mills had to fight with Racine’s office for close to a year over his whistleblower share, in a manner that both surprised and perplexed his lawyer with Phillips & Cohen, a premier whistleblower firm.
If we’re keeping score, that makes Mills 3-0 when he goes to court over matters involving D.C. government. Fortunately, one of his victories actually benefited the District.
Jonathan Demella, Mills’ lawyer, was in town last Friday for a status hearing on Mills’ bid protest, which he filed in March. The origin of the case is that, as the Chartwells contract was due to expire, DCPS issued a request for proposals on a new multi-year contract. But instead of choosing one provider for the entire school district, DCPS broke up its 100 or so schools into clusters of 10, purportedly to encourage competition, diversify its outsourced services, and minimize risk. Mills, having prevailed over Racine’s office in his whistleblower fee dispute, invested his own money and formed a food services company called Genuine Foods and bid on the contract.
According to his affidavit in D.C. Superior Court, Mills developed a team that consisted of food industry experts with a combined 35 years of school food service at more than 1,300 urban schools, including former food service directors at four of the largest urban school districts in the country.
In February 2016, Genuine Foods learned it was selected to participate in the taste test phase of the solicitation and met with DCPS a month later to discuss its proposal and provide additional documentation that DCPS had requested. Officials told Mills that they planned to award the contract within the next month. Two days after the designated selection date, Mills wrote to the chief procurement officer, Glorious Bazemore, to inquire about the results. Five weeks passed without a reply, then he asked again. By then, word was out that DCPS was proceeding with SodexoMAGIC, a joint venture involving Earvin “Magic” Johnson, and DC Central Kitchen.
On May 20, 2016, DCPS responded to Mills with a “notice of non-award.” He spent the next couple of weeks pressing Bazemore for a debriefing. On June 7, she rescinded that notice, but as Mills sought an explanation, conflicting accounts circulated. Some said DCPS had executed contracts with Sodexo and DC Central Kitchen and that Genuine Foods was out of the running. Others said no contract had been awarded at all.
Eventually, Bazemore informed Mills that she had rescinded the non-award notice on the advice of Racine’s office—and that no contract had been awarded. At a debriefing, which did not occur until after the D.C. Council approved a Sodexo contract, Bazemore attributed a “neutral score” to the fact that Genuine Foods was a new company still in the process of hiring its management team. When she asked for more information from Genuine Foods, Mills alleges, she failed to give credit after it was provided. When she found merit, such as cost savings, she failed to credit that too, he claims. She even disclosed that she had made an initial, undisclosed scoring, but changed it on the advice of Racine’s office.
Genuine Foods filed a bid protest last summer before the District’s Contract Appeals Board and lost, despite both surpassing technical requirements and Sodexo’s failure to meet mandatory requirements, among other procurement law aberrations. In March, Mills appealed in D.C. Superior Court, which will rule on whether the Contract Appeals Board’s decision is “clearly erroneous as a matter of law.”
Racine’s office says it is abiding by its duty to defend the CAB decision. As to how to handle whistleblower cases in general, the office says it is consulting with other government legal agencies to determine whether and how to adjust its policies to reflect best practices.
Among other things, Mills and Genuine Foods allege that DCPS screwed up the bid scores, engaged in “unequal discussion favoring Sodexo,” and demonstrated an “impermissible bias” toward the multinational behemoth. And internal DCPS communications, not to mention Mills’ successful legal track record, both suggest that Racine has his hands full in defending the way D.C. does business.
A key red flag is that Henderson was censured by the D.C. Board of Ethics and Government Accountability in November for soliciting $100,000 in charitable contributions from Chartwells-Thompson. Internal communications point to a similarly easygoing relationship with Sodexo and Magic Johnson, in which the venture enjoyed an unusual level of access, even during the procurement process.
Henderson met at least twice with Johnson between 2015 and 2016, according to her own Twitter account. The two appear together in photographs at galas. She solicited the same charitable contributions from Sodexo as she did from Chartwells. (Sodexo gave $10,000 donations to Standing Ovation, a Kennedy Center charity ball for DCPS, in both 2013 and 2015.)
Perhaps of greater significance is Henderson’s relationship with SodexoMAGIC’s vice president Antonio Hunter, former director of the Department of Small and Local Business Development under former Mayor Vincent Gray. “Hi Kaya,” Hunter wrote on May 19, 2015, asking if she could spare 10 minutes to talk about the charity ball. “As usual you are knocking the cover off the ball.”
In June, Hunter invited her to The World Affairs Council Gala as Magic Johnson’s guest. “NICE!!!” she replied on June 16, 2015. “So can we get Magic as a presenter for Standing Ovation this year?”
But the emails don’t tell all. When Henderson suggested she connect Hunter with a mutual associate, Hunter replied, “Let’s talk offline.” Later, Hunter arranged for Henderson to meet with Johnson in Pentagon City after a meeting with a group of business executives. Shortly after that, Hunter had a meeting with Nathaniel Beers, then chief operating officer for DCPS. From July through August, there were pre-solicitation meetings between DCPS and every prospective bidder that requested one except Genuine Foods, according to internal emails and DCPS documents. Hunter even had Sodexo’s pre-solicitation meeting before Mills expressed interest. In December, DCPS posted its RFP.
A Dec. 22, 2015 an internal email between Bazemore and Sara Goldband, deputy chief for procurement and administration, confirms that Mills was excluded. Goldband wrote: “Am I understanding correctly that Jeff [Mills] reached out in July, but we did NOT include him in the potential bidder’s list? If so, that would be a truly unfortunate oversight on our part.”
Perhaps the most damaging piece of evidence that Racine’s office will have to contend with is a calendar entry from May 18, 2016, while the procurement process was still underway, that shows Henderson had a conference call with Stephen Dunmore, Sodexo’s CEO of North American schools.
Mills has the burden of proving that DCPS violated the law. Since being rebuffed in D.C., he has landed a contract serving an entire school district in New York City, with others in the works, and has grown his company to 40 employees. One might surmise he is qualified to handle serving food to children in 10 DCPS schools.
For Racine, the task is to consider not just whether he can quash the protest, but whether he wants his office to be in the business of defending Henderson’s growing legacy of impropriety.