Opinion
C. A. PC-2015-3438
07-24-2018
LOUIS A. DEQUATTRO, JR. v. THE RHODE ISLAND PERSONNEL APPEAL BOARD and PAUL MCGREEVY, Individually and in his Official Capacity as the Former Director of the RHODE ISLAND DEPARTMENT OF BUSINESS REGULATION
For Plaintiff: Martin K. DeMagistris, Esq. For Defendant: Jennifer Sanborn Sternick, Esq.; Steven B. Merolla, Esq.
For Plaintiff: Martin K. DeMagistris, Esq.
For Defendant: Jennifer Sanborn Sternick, Esq.; Steven B. Merolla, Esq.
DECISION
TAFT-CARTER, J.
Appellant Louis A. DeQuattro, Jr. (Appellant or DeQuattro) appeals the August 31, 2015 decision of the Rhode Island Personnel Appeal Board (the Board or PAB) upholding the discipline imposed by the Department of Business Regulation (DBR) on DeQuattro. Jurisdiction is pursuant to G.L. 1956 § 42-35-15. For the reasons set forth in this Decision, the Court affirms the decision of the PAB.
I
Facts and Travel
A
DeQuattro's Work History
DeQuattro, an attorney and certified public accountant, began his career in state service in 1992 as an insurance examiner for the Department of Business Regulation (DBR), Insurance Division. (Decision 3; Hr'g Tr. 92:1-22, May 18, 2015.) Over the years, DeQuattro rose to the positions of Deputy Chief Legal Counsel for the Department of Administration and Associate Director and purchasing agent. (Decision 3.) At the time of the challenged disciplinary action, he served as Deputy Director of Legal Services at the DBR and "Executive Counsel." (Decision 3-4.) In these capacities, DeQuattro supervised the DBR's staff attorneys, managed legal work for the DBR, and addressed issues relating to gaming and banking (Decision 4; Hr'g Tr. 8-9, Apr. 16, 2015.) In addition to these duties, DeQuattro was a hearing officer in municipal liquor licensing disputes, the agency's public information officer, and the ethics officer for the DBR. (Decision 4; Hr'g Tr. 9:15-11:6, Apr. 16, 2015.) In addition to his work in state service, DeQuattro held the part-time position of North Providence Municipal Court Judge since July 2011. (Hr'g Tr. 179:14-22, May 18, 2015.)
In 2010, while employed as Associate Director and purchasing agent in the Department of Administration, DeQuattro received a letter of reprimand from Rosemary Booth Gallogly, the Director of the Department of Administration. (Decision 4.) The letter of reprimand admonished DeQuattro for "us[ing] poor judgment and violat[ing] purchasing procedures" when he considered an untimely filed contracting bid from H.V. Collins while acting in his capacity as a purchasing agent on November 25, 2008. (State's Ex. 11.) The letter was not included in DeQuattro's personnel file, but was kept in Human Resources records. (Hr'g Tr. 236:4-11, May 18, 2015; Hr'g Tr. 41:1-42:10, May 20, 2015.)
At all times relevant to this appeal, the DBR and the Division of Lotteries, Department of Revenue (Lottery) worked together to regulate the gaming industry in Rhode Island. (Hr'g Tr. 51:11-52:10, Feb. 26, 2015.) Together, they jointly held "full operational control" of the regulation of the Twin River Casino (Twin River) in Lincoln, Rhode Island. (Decision 2, citing § 42-61.2-2.1(c); Hr'g Tr. 7:4-13, Apr. 16, 2015.) In order to ensure the State's investment in the casino remained within Rhode Island, Twin River was subject to a compliance agreement with the Lottery and the DBR. (Hr'g Tr. 54:17-55:14, Feb. 26, 2015.) The agreement set forth specific procedures and required disclosures regarding the transfer of assets or debts of Twin River. Id.
Twin River is owned and operated by Twin River Management Group.
The Court notes that the March 4, 2016 enactment of P.L. 2016, ch. 6, § 2 modified § 42-61.2-2.1(c) to grant full operational control to only the Lottery. For the purposes of this administrative appeal and all underlying facts, however, the previous language of § 42-61.2-2.1(c) controls.
The Rhode Island State Police exercised oversight of Twin River through its Gaming Enforcement Unit. The unit is charged with "[c]onducting due diligence . . . and background investigations with respect to entities and individuals required to be licensed by the division and/or the department of business regulation." Sec. 42-61.3-1; Decision 2-3, citing State's Ex. 7 and Hr'g Tr., Apr. 7, 2015.
As a result of the regulatory interplay among the three government entities, DeQuattro frequently collaborated with the Lottery and the State Police to regulate Twin River. (Decision 2-3; Hr'g Tr. 53:9-21, Feb. 26, 2015.) He was the DBR's contact person for Lottery Director Gerald Aubin and Craig Eaton, chief legal officer at Twin River. (Decision 4; Hr'g Tr. 53:9-21, Feb. 26, 2015; Hr'g Tr. 14:10-22, Apr. 7, 2015.)
B
The 2013 Liquor Board Hearing
This appeal concerns two instances of misconduct. The first instance of misconduct concerns a 2013 Liquor Board hearing. On August 1, 2013, DeQuattro served as a hearing officer for the DBR in the matter of RMP Investment Group v. City of Providence, DBR No. 13LQ063, regarding the appeal of a grant of a liquor license to RMP Investment Group, LLC (RMP). (State's Ex. 5; Decision 7.) During the hearing, DeQuattro admitted into the record a letter from Dino Autiello, Vice President of the North Providence Town Council, advocating for the approval of the liquor license. (State's Ex. 5.) The letter was addressed to "Judge DeQuattro" and endorsed "the character, business acumen, and professionalism" of the applicants for the license, based on the letter writer's experience as a former employee of the applicants. (July 30, 2013 Letter from Dino Autiello, State's Ex. 5.) DeQuattro stated on the record that he had received the letter by mail and accepted the letter into the record without disclosing to the parties his position as a North Providence Municipal Judge. (RMP Investment Group v. City of Providence Hr'g Tr. 6:11-23, Aug. 1, 2013, State's Ex. 5.) On October 4, 2013, DeQuattro issued a recommendation that the DBR uphold the grant of a liquor license to RMP. (In the Matter of Liquor License Application of RMP Investment Group, LLC, Decision and Order, Oct. 4, 2013, State's Ex. 5.) DBR adopted the recommendation as its decision, dated October 7, 2013. Id.
The decision was appealed to the Superior Court. In the appeal, it was argued that DeQuattro had failed to disclose his employment as a Municipal Court Judge for North Providence. (State's Ex. 5.) On September 30, 2014, the DBR moved for remand of the RMP matter in part to address the issue of alleged bias resulting from DeQuattro's failure to disclose his professional relationship with Autiello. (State's Ex. 5; Findings of Fact, Decision ¶ 64.) The DBR personnel and legal team brought this issue to the attention of Paul McGreevy, the DBR Director, during the March 2015 investigation into the second instance of DeQuattro's misconduct. (Hr'g Tr. 17:18-18:5, Apr. 16, 2015.)
C
Twin River and Fertitta
The second instance of misconduct concerns an issue involving Twin River. On February 13, 2014, while conducting a background investigation pursuant to § 42-61.3-1, Corporal Timothy Allen of the State Police met with Tilman Fertitta, CEO of Fertitta Entertainment, in Houston, Texas to discuss the investor's interest in increasing his investment in Twin River. (Hr'g Tr. 117:1-8, Apr. 7, 2015.) During the interview, Fertitta mentioned a 2012 conversation he had with John Taylor, Board Chairman of Twin River Management Group. Id. at 117:19-118:1. Fertitta stated that he had set up the 2012 meeting with Taylor because he was interested in acquiring Twin River Management Group. Id. at 123:5-8. According to Fertitta, Taylor told him that "Rhode Island was unlike anywhere else," and that he would have an issue with the regulators. Id. at 123:17-18. According to Allen's testimony, Fertitta "repeatedly stated" that he thought Taylor was "hiding behind the regulators" and was "upset" about the way the meeting went. Id. at 123:19-20, 125:8-9; Excerpt, Fertitta Inc. Background Investigation, Appellant's Ex. B.
Fifteen days later, on February 28, 2014, Lt. Flaherty told Aubin about his meeting with Fertitta and the comment Fertitta had made about his 2012 conversation with Taylor. (State's Ex. 3.) Lt. Flaherty advised Aubin he wished to contact the DBR to ask if they had knowledge of this potential purchase. Id.
On March 3, 2014, Lt. Flaherty contacted DeQuattro to schedule a meeting. (Hr'g Tr. 128:18-129:2, May 18, 2015.) At the meeting, Flaherty asked DeQuattro a number of questions concerning companies interested in purchasing Twin River and whether DeQuattro was aware of a company offering to purchase Twin River in late 2012. Id. at 130:12-131:24. Flaherty informed DeQuattro about Fertitta's offer and the ensuing conversation between Fertitta and Taylor. Id. DeQuattro gave Flaherty his thoughts on what Taylor might have meant. Id. at 132-33. During the conversation, Flaherty questioned DeQuattro concerning the compliance agreement and whether it required Twin River to disclose this offer. Id. at 136:1-16. DeQuattro concluded it would not. Id. at 136:1-22. Later that day, DeQuattro had separate conversations with McGreevy and Maria D'Alessandro. Id. at 134:10-23.
Lt. Flaherty met with Aubin and Marilyn McConaghy, legal counsel for the Lottery. At that meeting, he cemented his conclusion that Twin River was not obligated to report the offer. (State's Ex. 3; Hr'g Tr. 75:1-22, Feb. 26, 2015.) Flaherty spoke with Aubin about the details of his conversation with DeQuattro. (State's Ex. 3.) Aubin told Flaherty that he planned to call a meeting with Taylor and other members of Twin River leadership because he was "very, very concerned" about Fertitta's comment and wanted to "determine what was said at the . . . meeting." (State's Ex. 3; Hr'g Tr. 76:2-3, Feb. 26, 2015.) Aubin was particularly "concerned" that a "potential purchaser" of the casino had indicated to the State Police that he was not going forward with a purchase because he believed "the regulators were preventing him from doing so." (Hr'g Tr. 76:2-16, Feb. 26, 2015.) Aubin emailed Taylor to set up a meeting for March 14, 2014, but did not advise Taylor of the reason for the meeting. (State's Ex. 3; Hr'g Tr. 76:16-77:5; 78:19-23, Feb. 26, 2015.)
Aubin testified that he spoke to DeQuattro by telephone the next day. (Hr'g Tr. 78:21-79:1, Feb. 26, 2015; Hr'g Tr. 138:19-24, May 18, 2015.) Aubin told DeQuattro he was "very concerned about the alleged allegations made by Mr. Taylor" to Fertitta. (Hr'g Tr. 81-1:11, Feb. 26, 2015.) Furthermore, he told DeQuattro that he was scheduling a meeting with Taylor at the Lottery but that he had not disclosed the topic of the meeting because he did not want Taylor to "have a prepared" answer. Id. DeQuattro disputes the conversation and maintains that Aubin told him he "might want to chat with" Twin River leadership about the deal. (Hr'g Tr. 144:12-16; 139:20-140:6, May 18, 2015.)
On a routine business call on March 13, 2014, Craig Eaton, General Counsel for Twin River, told DeQuattro he and Taylor had a meeting the next day with Aubin and had not been given a reason for the meeting. (Hr'g Tr. 19:18-23, Apr. 7, 2015.) Eaton asked DeQuattro if he had any idea what the call might be about. Id. at 19:22-23. Eaton recalled that DeQuattro told him "between me and you, I think they're going to-they want to ask you about Fertitta; you might want to-you might . . . just . . . make yourself familiar [with] the Fertitta meeting." Id. at 20:1-7. According to Eaton, when he asked what the Fertitta meeting was, DeQuattro told him, "I'm not going to say anymore." Id. at 20:21-24. DeQuattro disputes this characterization of the conversation and testified that when Eaton asked him what the meeting might be about DeQuattro responded that Aubin "might have some questions on . . . the proposed deal and the offer that was made between Fertitta and Taylor." (Hr'g Tr. 154:18-22, May 18, 2015.) The next day, Aubin, Allen and Marilyn McConaghy met with Taylor, Eaton, and Craig Sculos, general manager of Twin River. DeQuattro spoke to Eaton after the meeting. (DeQuattro and Eaton Hr'g Tr. 161:5-8, May 18, 2015.) Eaton later informed Taylor of his conversation with DeQuattro, telling him, "I think they're going to ask us about Fertitta tomorrow; I don't really . . . know what that is." (Hr'g Tr. 21:5-8, Apr. 7, 2015.) According to Eaton, Taylor then "refreshed his memory" about the New York meeting with Fertitta. Id. at 22:3-4.
The next day, Aubin, Allen, and Marilyn McConaghy met with Taylor, Eaton, and Craig Sculos, general manager of Twin River. (Hr'g Tr. 161:5-8, May 18, 2015.) Aubin spoke to Eaton after the meeting. Id. at 162:8-10.
On March 18, 2014, Allen met with Eaton to ask him three questions concerning the March 14, 2014 meeting. Id. at 142:18-19. Allen sent an interdepartmental memorandum to Flaherty documenting the March 14, 2014 meeting, including his assessment that "[i]t was readily apparent" that the Twin River representatives knew the topic of the meeting prior to the meeting. (State's Ex. 4; Hr'g Tr. 91:16-92:9, Feb. 26, 2015.) It also documented Allen's March 18, 2014 conversation with Eaton, as follows:
"This detective asked Mr. Eaton the following questions:
"Did any member of the State Police contact you regarding the topic or scope of the questions for John Taylor prior to the meeting on Friday, March 14th: response: No
"Did any member of the RI lottery contact you regarding the topic or scope of the questions for John Taylor prior to the meeting on Friday, March 14th: response: No
"Did any member of the Department of Business Regulation (DBR) contact you regarding the topic or scope of the questions for John Taylor prior to the meeting on Friday, March 14th: response: Yes
"Who contacted you? Lou DeQuattro
"How did he contact you? Telephone conversation- Was not sure if he called Mr. DeQuattro or if Mr. DeQuattro called him.
"When was this phone conversation? Either the Wednesday or Thursday prior to the date of the scheduled meeting at RI Lottery.
"What was said? Mr. DeQuattro said 'between you and me' a 'heads up' regarding the meeting with John Taylor and the RI lottery. Familiarize yourself prior to the meeting with the offer from [Fertitta-] an issue may come up." (State's Ex. 4.)
After receiving the memorandum, Lt. Flaherty delivered a copy to Aubin. (Hr'g Tr. 91:16- 92:9, Feb. 26, 2015.)
D
Investigation and Discipline
On March 24, 2014, Aubin drafted a memorandum documenting his March 18, 2014 conversation with Lt. Flaherty. (State's Ex. 3; Hr'g Tr. 66:9-20, Feb. 26, 2015.) He sent this memorandum, along with Allen's interoffice memorandum (State's Ex. 4), to McGreevy. (Hr'g Tr. 12:20-22, Apr. 16, 2015.) Upon receipt of the documents, McGreevy immediately called Tony Bucci, Personnel Director, and advised him of the personnel issue. Id. at 13:14-16.
The following day, McGreevy held a meeting with the personnel and legal team concerning DeQuattro. (Hr'g Tr. 13:23-14:7, Apr. 16, 2015.) At the meeting, McGreevy asked the team to conduct an investigation and report back their findings. Id. The team concluded that DeQuattro should be placed on paid administrative leave. Id. at 14:12-23. The following day, McGreevy's secretary called DeQuattro to tell him that McGreevy wanted to meet with him. (Hr'g Tr. 165:1-7, May 18, 2015.) A meeting was scheduled for Friday, March 28, 2014. Id.
On March 28, 2014, DeQuattro met with McGreevy and Kathleen Lanphear. (Hr'g Tr. 164:20-23, May 18, 2015). At the meeting, he was placed on paid administrative leave and was relieved of all his duties. Id.; Hr'g Tr. 13:23-15:1, Apr. 16, 2015.
On June 5, 2014, DBR issued two disciplinary charges against DeQuattro (Appellant's Ex. H; See Hr'g Tr. 81:5-14, May 18, 2015.) The first charge read as follows:
"it has been reported that, during a telephone conversation a day or two before the [March 14] meeting . . . you told the General Counsel of the regulated gaming facility that, during the upcoming meeting, the Director of the Division of Lotteries might ask the [Twin River] Chairman about his earlier discussion with the prospective purchaser of the regulated facility . . .
"By alerting the representatives . . . to the topic of discussion ahead of time, you undermined the purpose of the meeting and the Director's strategy and failed to demonstrate proper judgment and an ability to maintain confidences entrusted to you." (Appellant's Ex. H.)
The second charge alleged that DeQuattro failed to disclose a potential conflict of interest during the RMP liquor board hearing on August 1, 2013, and that the failure to disclose his relationship with the author of the letter, which, "whether a deliberate concealment or a lapse of judgment, created an appearance of impropriety which strikes at the integrity of the Department's administrative appeals process." Id.
On June 10, 2014, the DBR conducted its pre-disciplinary/Loudermill hearing. See State's Ex. 8. On advice of counsel, DeQuattro did not take an oath at the Loudermill hearing. (Hr'g Tr. 231:4-11, May 18, 2015.)
DeQuattro was represented by counsel for all proceedings relevant to this appeal after the Loudermill hearing.
On June 17, 2014, the DBR Human Resources (HR) department issued its recommendation for DeQuattro's discipline. (Appellant's Ex. F.) In the draft letter, HR recommended a ten-day suspension without pay. Id. Later that month, Jennifer Sternick was assigned to McGreevy as legal counsel for this case. (Hr'g Tr. 66:18-24, Apr. 16, 2015.) McGreevy spoke with Sternick in determining the appropriate level of discipline for this case. (Hr'g Tr. 48:22-49:5, May 18, 2015.) McGreevy testified that in addition to the recommendation of HR, he used pages five through eight of the transcript from the RMP hearing (State's Ex. 5), Aubin's memorandum (State's Ex. 3), Allen's memorandum (State's Ex. 4), and the transcript from DeQuattro's June 10, 2014 Loudermill hearing (State's Ex. 8) to make his decision to demote DeQuattro. (Hr'g Tr. 31:20-32:4, Apr. 16, 2015.)
Sternick has served as counsel for the State in this case both before the Personnel Board and this Court.
The final disciplinary letter was issued to DeQuattro on July 3, 2014. (PAB R. 13, July 3, 2014 Letter; See Hr'g Tr. 87:1-13, May 18, 2015.) The letter asserted that DeQuattro created an "appearance of impropriety" with his actions at the RMP liquor board hearing, and further stated that
"despite being directly informed by the Director of the Division of Lotteries that he would be meeting with the Chairman of the regulated facility and had not disclosed the subject of the meeting ahead of time because he hoped to elicit a spontaneous and unrehearsed response to questioning, prior to the March 14, 2014 scheduled meeting between the Director of the Division of Lotteries and the Chairman of Twin River, you alerted the representatives of the regulated facility to the topic of discussion, you undermined the purpose of the meeting and the Director's strategy and failed to demonstrate proper judgment, and also failed to keep confidences entrusted to you in your position as Executive Counsel." (PAB R. 13, July 3, 2014 Letter.)
The letter also included the State's disciplinary action: "Based on the foregoing information and the seriousness of your actions, you are hereby suspended without pay for thirty (30) working days . . . and furthermore, demoted to the position of Chief Licensing Examiner . . ." Id.
Sometime during July or August 2014, the union steward at DBR informed McGreevy that DeQuattro was not eligible for the position of Chief Licensing Examiner. (Hr'g Tr. 39:18-40:16, May 18, 2015.) The issue was put into abeyance pending DeQuattro's appeal. Id. at 40:21-41:2.
DeQuattro filed a timely notice of appeal to the Board on July 17, 2014, attaching McGreevy's July 3, 2014 letter. (PAB R. 14.) A hearing began on February 19, 2015. (Decision 12.) On February 19, 2015, the Board heard three preliminary motions: the State's motion to dismiss; the State's motion to compel a witness list, a statement of facts, and hearing exhibits; and Appellant's motion for subpoenas to the Departments of Administration, Business Regulation and Revenue. (Hr'g Tr. 4:1-18, Feb. 19, 2015.) Hearing on the merits began on February 26, 2015 and continued on March 10, 2015; April 7, 2015; April 9, 2015; April 16, 2015; May 18, 2015; and May 20, 2015. (Decision 2.)
The Board unanimously voted to deny the State's motion to dismiss and issued a bench decision finding that DeQuattro was a classified employee and that there was no record that he occupied a position in state service as executive counsel (Hr'g Tr. 75:16-76:11, Feb 19, 2015). On February 24, 2015, the State filed a motion to stay proceedings before the Board in Superior Court on the same grounds (PAB R. 40.) DeQuattro filed an opposition to the State's motion the next day, February 25, 2015. On February 26, 2015, the Superior Court heard arguments on and denied the motion. On January 8, 2015, the State moved to dismiss Appellant's appeal to the Board for lack of jurisdiction, asserting that because G.L. 1956 § 36-3-10 restricts appeals to the Board to members of the classified system and to employees alleging discriminatory action, the Board has no jurisdiction over DeQuattro, who served as an unclassified employee as a legal advisor and did not allege discrimination. (PAB R. 37 at 2, Jan. 8, 2015.) Subsequently, DeQuattro filed his objection to the State's motion to dismiss through counsel on February 7, 2015, asserting that his role of Deputy Director was a classified position and, as such, falls within the Board's jurisdiction. (PAB R. 39.)
Before proceeding to the first day of the hearing on the merits, the Board preliminarily granted Appellant's request for a subpoena to the State Police for all correspondence regarding DeQuattro, Eaton, Aubin, and McConaghy. (Hr'g Tr. 25:6, 20:22-23, Feb 26, 2015.) The State requested and was granted subpoenas for the testimony of Eaton and Allen. Id. at 27:23-28:22.
Four witnesses testified on behalf of the State. Gerald Aubin and Craig Eaton, chief legal officer of Twin River, testified on February 26, 2015; Corporal Timothy Allen testified on April 7 and April 9, 2015; and Paul McGreevy testified as the State's fourth witness on April 16 and May 18, 2015. DeQuattro testified on May 18 and May 20, 2015, and was the sole witness to testify on his behalf.
On July 7, 2015, the Board issued its decision upholding DBR's demotion and suspension of DeQuattro on the grounds that he improperly revealed confidential information to Twin River, and that he failed to disclose a potential conflict of interest while presiding as a Hearing Officer at the RMP liquor board appeal. Noting that there was a dispute regarding the content of the March 14, 2014 conversation between Aubin and DeQuattro, the Board found Aubin to be the more credible witness. The Board based its credibility determination on observations during the hearing and the fact that Aubin memorialized his conversation with DeQuattro "within a reasonable amount of time after it had taken place, when his memory was still fresh." (Decision 14; State's Ex. 3.) In contrast, the Board noted, DeQuattro did not memorialize his conversation and misrepresented his state service record as "unblemished." (Decision 14; State's Ex. 11.) The Board stated that despite his claim, DeQuattro had received a 2010 letter of reprimand for failure to adhere to bidding procedures. Id. The Board further noted that even if they found DeQuattro's account of his conversation with Aubin to be more credible, his actions "were still manifestly improper under the circumstances." (Decision 14.)
The Board also included its findings of fact and conclusions of law from its February 19, 2015 bench decision to deny the State's motion to dismiss in its written July 7, 2015 decision. Neither party has challenged this portion of the Board's decision.
With regard to DeQuattro's alleged failure to disclose his position as a North Providence Municipal Court Judge, the Board found that there were no material facts in dispute. (Decision 16.) After finding that DeQuattro had failed to disclose this potential conflict of interest, the Board found that McGreevy's "entirely legitimate concern" had been that this failure to disclose created the appearance of impropriety, not that it created an actual conflict of interest. Id. The Board noted that DeQuattro's response to Attorney Litwin created "the appearance of downright evasiveness," and that his failure to disclose any potential conflicts of interest on the record "'opened the door' to challenges on the basis of bias, and thus called the integrity of the DBR hearing process into question." Id. at 17-18.
Finally, the Board found that the level of discipline McGreevy imposed on DeQuattro was "entirely appropriate to the circumstances." (Decision 18.) Noting that the role of Deputy Director required both McGreevy and Aubin to have "a high degree of trust and confidence" in him, the Board found that DeQuattro's actions demonstrated he was unable to fulfill that trust. Id. Furthermore, the Board found that DeQuattro had demonstrated an inability to appreciate the severity of his conduct. Id. The Board based this finding on DeQuattro's repeated characterization of his comment to Eaton as a misunderstanding, his continued defense of his failure to disclose his status as a Municipal Court Judge, and his inability to articulate how he would restore the trust required for his position. Id. at 19. The Board noted that when DeQuattro was asked to explain Aubin's testimony about their conversation, he stated that he believed Aubin had "a misunderstanding of what we talked about and what the conversation entailed." (Hr'g Tr. 52:21-23, May 20, 2015.) DeQuattro subsequently appealed the decision to this Court on August 6, 2015, seeking reinstatement to his former position and salary.
II
Standard of Review
The Superior Court's review of an administrative decision is governed by § 42-35-15 of the Administrative Procedures Act (APA), which provides as follows:
"(g) The court shall not substitute its judgment for that of the agency as to the weight of the evidence on questions of fact. The court may affirm the decision of the agency or remand the case for further proceedings, or it may reverse or modify the decision if substantial rights of the appellant have been prejudiced because the administrative findings, inferences, conclusions, or decisions are:
"(1) In violation of constitutional or statutory provisions;
"(2) In excess of the statutory authority of the agency;
"(3) Made upon unlawful procedure;
"(4) Affected by other error or law;
"(5) Clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or
"(6) Arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion." Sec. 42-35-15(g).
In reviewing an administrative decision, "the [C]ourt must confine itself to review of the record to determine whether 'legally competent evidence' exists to support the agency decision." Baker v. Dep't of Emp't & Training Bd. of Review, 637 A.2d 360, 363 (R.I. 1994) (citing Envtl. Sci. Corp. v. Durfee, 621 A.2d 200, 208 (R.I. 1993)). Essentially, "if 'competent evidence exists in the record, the Superior Court is required to uphold the agency's conclusions.'" Auto Body Ass'n of R.I. v. State Dep't of Bus. Regulation, 996 A.2d 91, 95 (R.I. 2010) (quoting R.I. Pub. Telecomms. Auth. v. R.I. State Labor Relations Bd., 650 A.2d 479, 485 (R.I.1994)).
Regarding issues of credibility, the Superior Court "is not privileged to assess the credibility of witnesses and may not substitute its judgment for that of the [agency] concerning the weight of the evidence on questions of fact." Liberty Mut. Ins. Co. v. Janes, 586 A.2d 536, 537 (R.I. 1991). Accordingly, the Court must sustain the decision of the agency "unless it finds that the decision was clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record." Id. (quoting § 42-35-15(g)(5)).
III
Analysis
A
DeQuattro's Resignation
As an initial matter, the Court will address an issue raised by the State: whether DeQuattro has waived his right to reinstatement in public service by resigning from his position. In support of this argument, the State proffers correspondence between DeQuattro and the Office of Personnel Administration ("Sept. 9, 2015 Letter from DeQuattro" and "Sept. 14, 2015 Letter from Office of Personnel Administration," respectively) where DeQuattro informed the State he will not be returning to employment, and the State accepted. The State posits that an employee who resigns from state service relinquishes his right to employment in state government. R.I. Pub. Telecomms. Auth. v. Russell, 914 A.2d 984 (R.I. 2007).
However, Russell involved a voluntary retirement, while the correspondence before the Court does not. Unlike the appellant in Russell, who accepted voluntary retirement after a layoff for reasons unrelated to his job performance, DeQuattro alleges that he was wrongfully demoted. The Russell Court carefully distinguished voluntary retirement from wrongful discharge. See Wilkinson v. State Crime Lab. Comm'n, 788 A.2d 1129 (R.I. 2002) (holding that an employee who alleged that he was wrongfully discharged and then reinstated at a lower, unclassified position did not waive his right to reinstatement in his original position); Russell, 914 A.2d at 994 (distinguishing Wilkinson by noting that the appellant in that case had alleged wrongful termination). The Court thus finds that DeQuattro has not waived his right to reinstatement by resigning from state government.
B
Evidentiary Issues
1
The Twin River Meeting Charge
DeQuattro challenges the Board's finding that he disclosed the topic of the March 14, 2014 meeting to Eaton in violation of the confidence placed in him by Aubin. Specifically, DeQuattro contends that no evidence on the record supports the Board's finding because "not a single witness" testified that he informed Eaton that the purpose of the March 14, 2014 meeting was to discuss the comment Taylor made to Fertitta in 2012. DeQuattro further avers that McGreevy changed his testimony on this issue between the April 16 and May 18, 2015 hearings, and the Board erroneously relied upon this inconsistent testimony in making its decision.
Title 36, chapter 4, § 38 of the Rhode Island General Laws sets out the conditions under which an agency may terminate an employee in state service. A classified employee with permanent status "may be dismissed by an appointing authority whenever he or she considers the good of the service to be served thereby, stated in writing, with full and sufficient reason, and filed with the personnel administrator." Sec. 36-4-38. Our Supreme Court has determined that the phrase "the good of the service" places the burden of proof on the appointing authority to establish that a personnel action is "for cause," by establishing "substantial grounds" via "legally sufficient evidence." Hardman v. Pers. Appeal Bd., 100 R.I. 145, 151-52, 211 A.2d 660, 664 (1965) (citing Aniello v. Marcello, 91 R.I. 198, 207, 162 A.2d 270, 274 (1960)).
DeQuattro notes that "not a single witness" testified in support of the charge that he disclosed the issues involved in the March 14, 2014 meeting. However, the issue before the Board was the July 3, 2014 final employment decision. This July 3, 2014 final decision letter included the finding that DeQuattro "alerted the representatives of the regulated facility to the topic of discussion," "undermined the purpose of the meeting and the Director's strategy and failed to demonstrate proper judgment, and also failed to keep confidence entrusted to [him] in [his] position as Executive Counsel." (PAB R. 13, July 3, 2014 Letter.) As such, the June 5, 2014 charge is not relevant to this appeal. Here, the Board had competent evidence before it-most notably, Eaton's testimony-to support its finding that DeQuattro informed Eaton of the topic of the March 14, 2014 meeting.
DeQuattro also asserts that the Board erred in relying on McGreevy's testimony in upholding DBR's disciplinary action. He asserts that McGreevy testified inconsistently at the April 16, 2015 hearing and the subsequent May 18, 2015 hearing about his specific concern regarding DeQuattro's alleged disclosure. Specifically, DeQuattro contends that the inconsistencies between McGreevy's April 16 and May 18, 2015 testimony regarding his beliefs about DeQuattro's conversation with Eaton indicate that the witness had "obviously" been told in the interim between his testimony "that the evidence showed that DeQuattro had not revealed the purpose of Aubin's meeting." Counsel for DeQuattro began his cross-examination of McGreevy on April 16, 2015, during which he questioned the witness about what he believed DeQuattro had said to Eaton:
"MR. DEMAGISTRIS: Okay. What is it you believe Mr. DeQuattro said to Mr. Eaton?
"PAUL MCGREEVY: He informed him of the nature and the purpose of the-or the subject matter of the meeting that Director Aubin was planning to have with John Taylor and Craig Eaton.
"MR. DEMAGISTRIS: And the subject matter of . . . the meeting was, what?
"PAUL MCGREEVY: The subject matter was a conversation or exchange between Fertitta, an individual or an entity that had talked to-independently talked to Twin River about purchasing it.
. . . .
"MR. DEMAGISTRIS: And anymore [sic] specific than that?
. . .
It is true that the issue, as you understood it, that was to be addressed at that meeting between Twin River and the Lottery was a comment made by Mr. Taylor to Mr. Fertitta in response to Mr. Fertitta's offer to purchase?
"PAUL MCGREEVY: Correct.
"MR. DEMAGISTRIS: Okay. And the response of Mr. Taylor was something to the effect, don't bother, the regulators would not approve that?
"PAUL MCGREEVY: Correct.
"MR. DEMAGISTRIS: Okay. It was not the meeting in general, correct, that was the focus of Mr. Aubin's interest?
. . . .
"PAUL MCGREEVY: The facts of the meeting, I don't think that was Director Aubin's concern.
"MR. DEMAGISTRIS: Okay. So you believe that Mr. DeQuattro revealed that . . . through Mr. Eaton, . . . the regulator's comment would be addressed at that meeting.
"PAUL MCGREEVY: Taylor's comment would be addressed at that meeting.
. . . .
"MR. DEMAGISTRIS: If Mr. DeQuattro had not, in fact, said to Mr. Eaton this comment made by Mr. Taylor about the regulators is going to be brought up, if he had not said that to Mr. Eaton, would that factor into your discipline?
"PAUL MCGREEVY: If he had not said that, I don't think any of this would have started.
"MR. DEMAGISTRIS: So it was the fact that you believe Mr. DeQuattro specifically mentioned Mr. Taylor's comment to Mr. Fertitta about the regulators, that is at issue?
"PAUL MCGREEVY: The comment he made to Craig Eaton about that, yes." (Hr'g Tr. 101:23-104:21, Apr. 16, 2015.)
Later on the same day, counsel for DeQuattro further questioned McGreevy on the specifics of what DeQuattro had relayed to Eaton:
"MR. DEMAGISTRIS: Would it be relevant to your consideration of Mr. DeQuattro's discipline, if you were aware that Mr. Eaton did not hear about Mr. Taylor's comment from Lou DeQuattro?
"PAUL MCGREEVY: If he denied it?
"MR. DEMAGISTRIS: Yup.
"PAUL MCGREEVY: That would be significant." (Hr'g Tr. 114:3-15, Apr. 16, 2015.
DeQuattro continued his cross-examination of McGreevy at the May 18, 2015 hearing. At the hearing, McGreevy testified that he was concerned by the way DeQuattro had conducted himself, in that "[h]e disclosed confidential information to a regulated entity, and subsequent to us finding that out, failed to disclose his relationship to somebody who had submitted evidence in a hearing." (Hr'g Tr. 26:18-22, May 18, 2015.) When counsel pressed McGreevy about his concerns that DeQuattro had disclosed that the meeting would be about Taylor's comment to the regulator, McGreevy responded that "the bigger issue here is that Lou should not have conveyed [any] information that he was specifically told not to convey, in any form." Id. at 27:14-17.
The Court is instructed to review the evidence on the "whole record" to determine whether any clear error or other violation has resulted in prejudice to the substantial rights of the appellant. Sec. 42-35-15(g); Baker v. Dep't of Emp't & Training Bd. of Review, 637 A.2d 360, 365 (R.I. 1994). McGreevy did testify on cross-examination during the April 16, 2015 hearing that he believed that DeQuattro had specifically told Taylor that the meeting would be about the comment Taylor had allegedly made during the 2012 meeting with Fertitta, and asserted that if DeQuattro had not made such a comment, it would have impacted his disciplinary decision. See supra n.6; Hr'g Tr. 101:23-104:15, Apr. 16, 2015. However, McGreevy also testified on April 16, 2015 that his concern with regard to DeQuattro's comments was broader. During cross-examination, McGreevy expounded on his understanding of Aubin's memorandum (State's Ex. 3), stating that he believed Aubin "wanted to have a meeting with Taylor and Eaton" and discuss "in a surprise mode" whether Twin River was "taking the regulator's position of being able to talk or speak to the regulators." Id. at 109:6-17. This statement was consistent with McGreevy's May 18, 2015 testimony. See Hr'g Tr. 26:18-22; 27:14-17, May 18, 2015. Thus, even if the Board were to disregard McGreevy's May 18, 2015 testimony as inconsistent, it would still have had to resolve the aforementioned conflicts in the witness's April 16, 2015 testimony.
Even assuming arguendo that the Board improperly relied on inconsistent testimony in affirming the findings regarding the Twin River charge, the Board's ultimate decision to uphold DBR's disciplinary decision would not be clearly erroneous, given the other reliable, probative, and substantial evidence on the record. See § 42-35-15; Baker, 637 A.2d at 364 (finding that while evidence did exist on the record to support the appellants' claims, the Superior Court did not err in upholding the agency's decision in light of the competent evidence on the record supporting the agency's findings). Most notably, McGreevy testified that he based his final disciplinary decision on three concerns: DeQuattro's disclosure of confidential information to Twin River; DeQuattro's failure to disclose a potential conflict of interest in his role as a hearing officer; and DeQuattro's failure to take accountability for his actions in his statement at the June 10, 2014 Loudermill hearing. (Hr'g Tr. 34:5-35:14, Apr. 16, 2015.) Specifically, McGreevy testified that he felt that the evidence in the documents sent to him by Aubin on March 24, 2014 indicated "a breach of confidence" on the part of DeQuattro. Id. at 14:9. McGreevy also testified that DeQuattro's failure to disclose his status as a Municipal Court Judge during the RMP hearing-despite multiple opportunities to do so-concerned him, because it was "necessary for the Department to be seen as being fair and impartial." Id. at 24:6-24. McGreevy opined that if DeQuattro had put the potential conflict of interest on the record, there "may not have been grounds for a conflict of interest." Id. at 27:2-13.
As noted in section III(B)(2) infra, there was no material evidence in dispute with regard to whether DeQuattro had failed to disclose a potential conflict of interest; on the contrary, DeQuattro testified he "didn't feel that [he had] any conflict . . . or any duty to disclose anything [at the RMP Hearing.]" (Hr'g Tr. 187:7-13, May 18, 2015.) Furthermore, DeQuattro did not provide evidence before the Board to dispute McGreevy's third concern. As the Board noted in its decision, "[g]iven the level of trust and confidence placed in DeQuattro, and the betrayal of that trust and confidence wrought by each action, either of DeQuattro's acts of misconduct would have supported this action." (Decision 19.) Accordingly, the Court finds that the Board's decision to affirm the DBR's finding regarding DeQuattro's conduct on the Twin River charge is not clearly erroneous in light of the reliable, probative, and substantial evidence on the record.
With regard to McGreevy's stated third concern, the Board noted in its decision that during his testimony, DeQuattro
"demonstrated that he is apparently unable to appreciate the severity of his misconduct, remediate his conduct, or repair the damage done thereby. He continually attempts to characterize his behavior with respect to Twin River as a mere 'misunderstanding.' He continually defends his failure to disclose his status as a North Providence Municipal Court judge. He was unable to articulate how he could go about restoring the trust that was essential to his position." (Decision 18-19.)
2
The RMP Liquor Board Hearing Charge
DeQuattro also asserts that the Board erred in finding that he failed to disclose a potential conflict of interest while presiding as a hearing officer in the RMP liquor board hearing. Specifically, he claims that the evidence at hearing revealed that McGreevy was mistaken about three facts with regard to the 2013 RMP liquor board hearing; first, that McGreevy mistakenly thought that the letter from Councilman Autiello had been written about applicants for the license; second, that McGreevy mistakenly believed that the North Providence Town Council had the power to hire and fire DeQuattro; and third, that McGreevy mistakenly believed that the parties objecting to the liquor license only appealed after learning that DeQuattro was a municipal judge in North Providence. He further argues that the Board erred in finding that DeQuattro failed to disclose a conflict of interest at the 2013 RMP liquor board hearing because there was no actual conflict of interest.
There is legally competent evidence to support the Board's conclusion that McGreevy had just cause for removing DeQuattro from his position as Deputy Director. See Baker, 637 A.2d at 363. Although McGreevy did admit that he was mistaken regarding the above facts, there is reliable, probative, and substantial evidence on the record to support the Board's finding that the mistaken beliefs were not relevant to DeQuattro's discipline, resulting in no substantial prejudice to DeQuattro. Throughout his testimony, McGreevy remained clear that his concern with DeQuattro's failure to disclose his professional relationship with the author of the letter was not one of an actual conflict of interest, but rather that of the "impression of impropriety." (Hr'g Tr. 34:14-15, Apr. 16, 2015.) McGreevy testified that "[i]t was less a concern" of his that there was an actual conflict of interest and that he believed that if DeQuattro had "simply declar[ed]" . . . for the record, that "he worked for [the City of North Providence]," the conflict of interest "probably would have been a non-issue." Id. at 81:4-9, 80:20-23. As the Board noted in its decision, DeQuattro's failure to disclose a potential conflict of interest still "'opened the door' to challenges [to the DBR's authority] on the basis of bias, and thus called the integrity of the DBR hearing process into question." (Decision 17-18.)
DeQuattro also raises the issue of recusal sua sponte in this appeal. He maintains that recusal in the RMP hearing would have been inappropriate and unnecessary given the lack of an actual conflict of interest. This argument is of no moment. The July 3, 2014 disciplinary letter asserted the State's position that DeQuattro had "failed to disclose" his employment to the parties in the RMP hearing and did not mention recusal. Furthermore, at no point during his testimony did McGreevy suggest that DeQuattro should have recused himself from the hearing; rather, McGreevy stated that he believed DeQuattro could have avoided the appearance of impropriety simply by disclosing his employment on the record. (Hr'g Tr. 80:20-22, Apr. 16, 2015.)
Accordingly, the Court finds that the Board's decision to uphold the DBR's finding that DeQuattro failed to disclose a conflict of interest and created the appearance of impropriety is not clearly erroneous. The Court further finds that there is reliable, probative, and substantial evidence to support this portion of the Board's decision. See § 42-35-15(g).
3
Hearsay in Allen's Memorandum
DeQuattro further argues that the Board erroneously admitted and relied upon Allen's March 19, 2014 memo (State's Ex. 4) in making its decision. Specifically, he alleges that the memorandum contains unduly prejudicial "rank hearsay."
Our Supreme Court has defined "rank hearsay" as hearsay which is "inadmissible under any exception to the hearsay rule." State v. Conway, 463 A.2d 1319, 1324 (R.I. 1983).
The Rhode Island APA governs the admission of hearsay in administrative appeals. It provides as follows:
"Irrelevant, immaterial, or unduly repetitious evidence shall be excluded. The rules of evidence as applied in civil cases in the superior courts of this state shall be followed; but, when necessary to ascertain facts not reasonably susceptible of proof under those rules, evidence not admissible under those rules may be submitted (except where precluded by statute) if it is of a type commonly relied upon by reasonably prudent men and women in the conduct of their affairs." Sec. 42-35-10(1).Although § 42-35-10(1) provides a relaxed application of the rules of evidence in administrative appeals, our Supreme Court has approached the admission of hearsay in such proceedings cautiously. See Wood v. Ford, 525 A.2d 901, 903 n.2 (R.I. 1987) ("[W]e caution that administrative tribunals may make use of hearsay evidence only within a limited context and in circumstances when it is necessary to ascertain facts not reasonably susceptible of proof under the normal rules of evidence.") However, admission of hearsay evidence by a fact-finder does not automatically constitute clear error. See Toribio-Chavez v. Holder, 611 F.3d 57, 66 (1st Cir. 2010) (finding that admission of letter containing hearsay was not prejudicial because the finder of fact was "compelled not by the letter but by the documentary evidence" and other admissible evidence and further noting that "the hearsay nature of a document affects weight, not admissibility"); Belisle v. Lisk, 16 F.2d 261, 264 (1st Cir. 1926) (holding that the admission of hearsay in a civil trial was "negligible and nonprejudicial," even if improperly admitted); cf. Richardson v. Perales, 402 U.S. 389, 402 (1971) (holding that hearsay evidence "may constitute substantial evidence supportive of a finding by the hearing examiner").
As noted infra, Allen's memorandum contained a record of the questions he asked Eaton about the March 14, 2014 meeting between Twin River and the Lottery, as well as Eaton's answers. (State's Ex. 4.) At the hearing, over objection of opposing counsel, the State used the memorandum to refresh Eaton's recollection. (Hr'g Tr. 34:22-35:16, Apr. 7, 2015.) At the close of its direct examination of Allen, the State moved to admit the exhibit in full. Id. at 145:18-19. Counsel for DeQuattro objected on the grounds that it was "rank hearsay" and that Eaton had presented conflicting testimony, testifying both that the memorandum was accurate but also that he did not fully recall the conversation. Id. at 145:20-146:9. The Board declined to admit the exhibit in full on the grounds that it contained hearsay that was neither reliable nor probative, but stated that it would "sort through" Eaton's testimony. Id. at 150:19-151:8.
Toward the close of its direct examination of McGreevy, the State moved once again to admit the memorandum as a full exhibit, as McGreevy had relied upon the document in making his decision to place DeQuattro on leave. (Hr'g Tr. 40:17-21, Apr. 16, 2015.) Counsel for DeQuattro again objected on the grounds that it contained hearsay and was an incomplete record of the conversation according to Eaton's testimony. Id. at 40:12-15. The Board admitted State's Exhibit 4 in full, on the grounds that it was not being admitted for the truth of the matter asserted within. Id. at 43:2-9.
Allen's memorandum contains hearsay that is inadmissible under the rules of evidence and lacks the reliability that would justify its admission in an administrative hearing. The memorandum is essentially a police report containing hearsay within hearsay, which is inadmissible under Rhode Island law. See Mercurio v. Fascitelli, 116 R.I. 237, 240, 354 A.2d 736, 739 (1976) (establishing that hearsay in a police report is not admissible as a past recollection recorded); Quint v. Pawtuxet Valley Bus Lines, 114 R.I. 473, 482, 335 A.2d 328, 333 (1975) (holding that hearsay statements in a police report are not admissible under the business record exception). Moreover, the hearsay in the memorandum lacks probative value, as both Allen and Eaton testified before the Board.
However, even assuming arguendo that the Board erroneously relied upon the hearsay in the memorandum, DeQuattro's substantial rights were not prejudiced given the other reliable, competent, and substantial evidence on the record. See § 42-35-15(g). Notably, the Board included one citation to Allen's memorandum in the analysis of its decision, as follows: "In his interview with Corporal Detective Allen, and at hearing, Eaton confirmed that during a telephone conversation of March 13, 2014, DeQuattro had told Eaton 'between you and me' that Aubin would be asking about the Fertitta meeting." (Decision 13.) The Board relied upon and cited Eaton's testimony at hearing in the same sentence as its reference to Allen's memorandum. Id.
Moreover, DeQuattro's emphasis on the inclusion of the allegedly prejudicial phrase "between you and me" is misplaced; a careful reading of the decision reveals that the Board placed no weight upon DeQuattro's phrasing in making its determination. In its decision, the Board indicated that the precise language DeQuattro used in the conversation was not relevant to whether DeQuattro engaged in conduct warranting discipline, noting that "[e]ven without the benefit of the March 4, 2014 conversation [with Aubin], DeQuattro ought to have instantly realized that Aubin may well have had his reasons for keeping silent about the purpose of the meeting." Id. at 14. Rather, the Board found that based on the evidence before it, "[a]n individual with DeQuattro's level of responsibility in this joint regulatory structure knew or should have known of the need to coordinate and cooperate with the Lottery." Id. at 15. These determinations by the Board are consistent both with the July 3, 2014 disciplinary letter and McGreevy's testimony regarding his reasons for disciplining DeQuattro. See PAB R. 13, July 3, 2014 Letter ("you alerted the representatives of the regulated facility to the topic of discussion, you undermined the purpose of the meeting and the Director's strategy and failed to demonstrate proper judgment, and also failed to keep confidences entrusted to you in your position as Executive Counsel"); Hr'g Tr. 34:5-22, Apr. 16, 2015 (McGreevy's testimony that DeQuattro's "breach of confidentiality" in providing information to Twin River's general counsel and DeQuattro's subsequent failure to address the reasons behind this breach at his Loudermill hearing factored into his determination of the appropriate discipline). Accordingly, the Court finds that DeQuattro was not prejudiced by any reliance the Board placed on Allen's memo and further finds that there is reliable, probative, and substantial evidence to support this portion of the Board's decision. See § 42-35-15(g).
4
Credibility Determinations
DeQuattro next challenges the Board's credibility determination with regard to both his own and Aubin's testimony. He avers that the Board erred in finding Aubin to be a credible witness, as Aubin refreshed his memory to testify, in comparison with himself, who testified from memory. DeQuattro further asserts that the Board erred in using Rosemary Gallogly's letter as evidence to determine his credibility as a witness, as the letter was not included in his personnel file.
When reviewing an agency's decision, the Superior Court places great weight on an agency's credibility determination. This Court "is not privileged to assess the credibility of witnesses and may not substitute its judgment for that of the director concerning the weight of the evidence on questions of fact." Janes, 586 A.2d at 537. See also Mendonsa v. Corey, 495 A.2d 257, 263 (R.I. 1985) (finding that the board of an administrative agency, "who had before it the individual witnesses and had the opportunity to judge their credibility, was in a better position than the court to resolve" any evidentiary conflicts); Ryan Iron Works, Inc. v. N.L.R.B., 257 F.3d 1, 7 (1st Cir. 2001) (asserting that the court must sustain an agency finder of fact's credibility determinations as long as the finder of fact's position "represents a choice between two fairly conflicting views"). Accordingly, the Court must sustain the agency's credibility determinations "unless it finds that the decision was clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record." Janes, 586 A.2d at 537.
Under this deferential standard, DeQuattro's challenge to the Board's credibility assessment of his own and Aubin's testimony must fail. See Labor Ready Ne., Inc. v. McConaghy, 849 A.2d 340, 346 (R.I. 2004) (holding that where competent evidence exists to support an agency's determination or interpretation, the reviewing court must uphold that determination, regardless of whether another interpretation is possible). DeQuattro challenges the Board's credibility assessment on the grounds that Aubin's refreshed recollection made his testimony less reliable than DeQuattro's own testimony, because DeQuattro testified without needing to refresh his memory.
The APA charges an administrative agency with following "[t]he rules of evidence as applied in civil cases in the superior courts," with exceptions to "ascertain facts not reasonably susceptible to proof under those rules." Sec. 42-35-10(1). Rhode Island Rules of Evidence 612 allows a witness to "use[] a writing to refresh his or her memory for the purpose of testifying." R.I. R. Evid. 612. Given that refreshing recollection is an established method of introducing competent evidence before a finder of fact in Rhode Island, the Court finds no clear error in the Board's determination that Aubin was a more credible witness than DeQuattro based on Aubin's use of his memorandum to refresh his recollection. The Court further finds that the credibility determination was not made on improper procedures or clearly erroneous.
DeQuattro challenges the Board's use of the Gallogly letter in weighing his credibility as a witness. During its cross-examination of DeQuattro, the State introduced DeQuattro's statement from his Loudermill hearing: "I have an impeccable and unblemished record of serving as a state employee for 22 years, a Municipal Court Judge for three years, a licensed certified public accountant for 20 years, and a licensed attorney for almost 15 years." (State's Ex. 8 at 33:20-25; see Hr'g Tr. 232:12-18, May 18, 2015.) The State then introduced a March 25, 2010 memorandum from Rosemary Gallogly, then director of the Department of Administration, to DeQuattro while he was working in the agency. (Hr'g Tr. 234:20-235:2, May 18, 2015; See State's Ex. 11.)
DeQuattro testified regarding the circumstances surrounding Gallogly's March 25, 2010 memorandum. (Hr'g Tr. 30:15-31:16, May 20, 2015.) DeQuattro stated that the Supreme Court's commentary on the late opening of the bid was dicta and not controlling because the Court found that the case was moot, and that the earlier Superior Court decision had "vindicated" the department, because that Court found no abuse of discretion in opening the late bid. Id. at 35:19-36:23. DeQuattro also testified that after receiving the memorandum from Gallogly, he met with her and explained it was common practice for the Department of Administration to open all late bids at that time, and they both agreed the memorandum would not be placed in his file. Id. at 40:22-42:10.
On appeal, DeQuattro claims that the Board erred in finding that he contradicted himself at hearing with his statement that he had an "impeccable" record of serv[ice] because the document the State used to impeach his credibility was not included in his personnel record. The State counters that because DeQuattro did not object to the admission of the document at the time of its admission, he has effectively waived any objection to the Board's use of the document in determining his credibility.
The Court notes that DeQuattro does not appeal the Board's admission of the Gallogly letter, but rather its reliance upon the letter in making the credibility determination. It is well settled that the Court must defer to an agency's credibility determinations so long as there is competent evidence on the record in support of those conclusions. Janes, 586 A.2d at 537 (holding that because the Superior Court is not privileged to assess the credibility of witnesses, it must uphold the judgment of the agency if competent evidence exists on the record to support the agency's conclusions); Berberian v. Dep't of Emp't Sec., Bd. of Review, 414 A.2d 480, 483 (R.I. 1980) (finding that on appeal, the Court does not "weigh the evidence" but rather "examine[s] the record to determine whether there is legally competent evidence" to support the decision of the finder of fact). As noted above, the Board based its credibility determination upon other competent evidence beyond the inconsistency it perceived between DeQuattro's statement that he had an "unblemished record" and the letter written by Rosemary Gallogly. Specifically, the Board also made its credibility determination based upon its observations of the witnesses during the hearing, as well as the fact that Aubin memorialized his recollection of the conversation within a short time of the event, while DeQuattro did not. (Decision 14.) Accordingly, the Court finds that there is no clear error, and there is substantial evidence in the record to support the Board's credibility determinations. See Janes, 586 A.2d at 537.
C
DeQuattro's Demotion to a Union Position
Finally, DeQuattro argues that the Board's affirmation of his demotion to the union position of Chief Licensing Officer which he could not hold is per se arbitrary and capricious and requests that this Court reinstate him in his role. In opposition, the State contends that the Board lacked jurisdiction to consider whether DeQuattro could properly hold the position to which he was demoted, and that that issue would need to be resolved by the two relevant parties: the State and the union.
The jurisdiction of the Board is limited to whether an appellant has been wrongfully disciplined or terminated by his or her employer. The Board "may confirm or reduce the demotion, suspension, layoff, or dismissal of the employee or may reinstate the employee and the board may order payment of part or all of the salary to the employee for the period of time he or she was demoted, suspended, laid off, or dismissed." Sec. 36-4-42.
Our Supreme Court has interpreted the scope of § 36-4-42 narrowly, finding that the Board may not modify the employing authority's penalty when it has accepted the authority's findings. Hardman v. Pers. Appeal Bd., 100 R.I. 145, 153, 211 A.2d 660, 665 (1965) (finding "no authority in the statute empowering the board to modify the penalty imposed by the employing authority" where the Board has accepted the charges made by the employing authority). The Court's interpretation is supported by the well-established principle that an agency's choice of sanction or penalty is entitled to deference on review. See Broad St. Food Market, Inc. v. U.S., 720 F.2d 217, 220 (1983) (the choice of a sanction is "'peculiarly a matter for administrative competence'" (quoting Kulkin v. Bergland, 626 F.2d 181, 184 (1st Cir. 1980))). The Court has additionally limited the Board's consideration of collateral issues. See Masyk v. Parshley, 94 R.I. 282, 289, 180 A.2d 314, 318 (1962) (finding that the Board lacked the jurisdiction to determine whether physician had been wrongfully deprived of his certificate of limited registration from the licensing board). Thus, given its limited jurisdiction and that the Board affirmed the DBR's charges against DeQuattro, its decision to decline to modify the penalty imposed by DeQuattro was not arbitrary, capricious, or an abuse of discretion.
IV
Conclusion
After review of the whole record, the Court finds that the Board's decision was not clearly erroneous in view of the reliable, probative, and substantial evidence on the record, not made on improper procedure, and not arbitrary or capricious. The Court also finds that the decision was not rendered in violation of constitutional or statutory provisions and was not an abuse of discretion. Substantial rights of DeQuattro have not been prejudiced.
Counsel shall submit a judgment in conformity with this Decision for entry.