A Westchester County court denied a motion to dismiss former Yonkers City Council President Mike Khader‘s lawsuit against Corporation Counsel, Matthew Gallagher.
The Investigation into Khader
Mike Khader served as City Council President in Yonkers from 2018 until his defeat by current CCP, Lakisha Collins-Bellamy. During their primary race in 2021, an ethics investigation into Khader was spurred by the City Council. The investigation was led by Inspector General Liam McLaughlin who promptly served Khader with a subpoena. Typically, members of government would be represented by the City’s Corporation Counsel. However, in this instance, Counsel Matt Gallagher denied Khader’s request for representation due to a conflict of interest. Though, Gallagher did cite a New York State law that allows for Khader to seek reimbursable outside counsel.
Khader did seek outside counsel with Newman Ferrara LLP representing him in this investigation led by the City of Yonkers. However, when these lawyers sought a motion to quash the original subpoena from IG McLaughlin, Gallagher asserted this action nullified the expectation for their reimbursement. This position was contested by Khader and eventually resulted in an email from Gallagher relenting. On September 17, 2021, Gallagher instructed staff to send “whatever paperwork he needs to submit to get this invoice paid.” However, Gallagher rescinded this offer only days later. He claimed that the instruction was sent in error.
Khader ultimately won his motion to quash the original subpoena. But, a revised subpoena was issued weeks later and required the production of documents and testimony from Khader. During this time, Gallagher sent a message stating that “any legal costs incurred by your client during the IG investigation will be at his expense. This includes […] any legal expenses related to the interview and any production of documents.” The production of these documents and oral testimony provided by resulted in legal bills totaling $70,893.12, Khader claims.
Khader Sues the City
On September 12th, 2022, attorneys for Mike Khader filed a lawsuit in Westchester County Supreme Court against the City of Yonkers and Matthew Gallagher in his capacity as Corporation Counsel. The petition defines the facts and timeline as summarized above. And it seeks relief in the form of payment for the legal services rendered during the IG investigation, this lawsuit itself, and “any further relief as the Court deems appropriate and equitable.“
Gallagher’s customary motion to dismiss this lawsuit was denied by Judge Melissa Loehr on March 24th, 2023. In her ruling, Judge Loehr noted that the legal precedent is such that “if any portion of an underlying cause of action is sufficient, it should not be dismissed.” And in this case, when the court examines the evidence presented, it “need not strain itself to find numerous viable causes of action.” The ruling also chide’s Gallagher’s actions during the onset of the Khader investigation. She noted that Gallagher’s correspondence to Khader and his attorneys was often contradictory. Going further to say that it can’t be seen as “anything other than arbitrary and capricious.” This passage led one lawyer familiar with the case to say that it was a “pretty big slap down” by the judge.
The ruling on this motion is not the end of this case. And Khader has not, and still may not, be awarded any compensation for his legal fees. This ruling only clears the path for further rulings or potentially a settlement by the City of Yonkers. But, the odds of Khader winning appear to be increasing. Judge Loehr even hints to this in her latest filing. She cites law from the City’s own charter to illustrate that Gallagher, in his role as Corporation Counsel, acted outside of his remit by denying payment. That the reimbursement payment is approved or rejected by the City Council and the Corporation Counsel’s duty is only “ministerial.”
If Khader is to receive compensation–either by court ruling or settlement–then that money will come from the City’s tax-payer funded budget. And to recap, tax-payers fund salaries of the City Council. The Council requested an investigation by a tax-payer salaried Inspector General. City Hall’s attorney recused himself from the matter, then, he was sued after refusing to reimburse outside counsel (with tax-payer money). The court fees spent to defend these actions also come from the city budget. Despite the accusations against Khader, whose investigation is still ongoing, the tax-paying citizens of Yonkers are the ones who are paying the price.
Note that this case brought by Khader is separate from the tort against the larger group consisting of the council members, mayor, Ron Matten, et al. Index number: 60762/2022
