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School risk manager who blew whistle on funds use can amend lawsuit

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A Texas school district risk manager who alleged that he was terminated for complaining about his employer's plan to raid its self-insured workers compensation and health insurance funds to build a football stadium press box can pursue his case on a narrower charge, a Texas appellate court has ruled.

In Weslaco Independent School District v. Adan Perez Jr., Mr. Perez claims he was “rebuked” when he informed the district that it is illegal to withdraw funds from the self-insurance programs to build a press box. He also claims that the district sought to silence him and that it created a plan to terminate him while he continued complaining to school district officials.

According to the ruling Thursday by Texas' 13th District Court of Appeals in Corpus Christi, Mr. Perez learned of the district's plan in 2009, and he was terminated in 2010. He filed his lawsuit in Hidalgo County, Texas, District Court in 2011, alleging breach of contract, breach of right of reasonable expectation to renewal of his contract and retaliation, among other claims, according to the ruling.

But the school district filed a plea asserting that the trial court where Mr. Perez filed his lawsuit lacked jurisdiction over its former risk manager's claims. The trial court denied the plea and the district appealed to the 13th District.

The appeals court reversed the trial court's denial of the district's plea on the jurisdiction issue and dismissed Mr. Perez's retaliation and breach of contract claims. Among other conclusions, the appeals court found that Mr. Perez did not exhaust available administrative remedies.

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But the appeals court remanded Mr. Perez's claim for breach of his right of reasonable expectation to renew his contract, noting that Mr. Perez alleged that his district contract was not renewed after one bad 2010 employee review following five years of prior “exemplary” reviews.

“After liberally construing Perez's pleadings in his favor and looking to his intent, we conclude that the pleadings do not contain sufficient facts to affirmatively demonstrate the trial court's jurisdiction, but also do not affirmatively demonstrate incurable defects in jurisdiction,” the appeals court said. “Therefore, Perez should be afforded an opportunity to amend his pleadings solely to this cause of action.”