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Queens Chronicle

Six ex-library trustees lose bid to keep seats

Win for Katz, though judge’s decision can be appealed; new member named

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Posted: Thursday, August 14, 2014 10:30 am | Updated: 11:55 am, Thu Aug 21, 2014.

The six former Queens Library trustees who took Borough President Melinda Katz and state Attorney General Eric Schneiderman to federal court in a bid to retain their volunteer positions on the board suffered a major setback Tuesday.

That same day, the first new appointee to replace one of them was named.

Brooklyn Magistrate Judge James Orenstein recommended that their requests for a temporary restraining order and preliminary injunction that would nullify their July 23 dismissal by Katz be denied. Orenstein made the decision in a verbal ruling from the bench, which a source familiar with the case said is rare and demonstrates the ease with which he made his determination.

“I think it’s worth noting that it’s rare for a magistrate judge to dictate a report and recommendation from the bench,” the source said. “The judge felt strongly enough about what he had heard in arguments to render the decision then, and it was unequivocal.”

In federal court, magistrate judges often hear motions and make recommendations to the judge actually assigned to the case, so the decision is not final. The source said the assigned jurist, U.S. District Judge Margo Brodie, could make the ruling official within a few days.

The plaintiffs have until Aug. 29 to file objections to Orenstein’s decision or they lose the right to appeal.

A spokesman for their attorney, Douglas Grover of the firm Schlam, Stone & Dolan, said they are weighing their legal options.

“The six trustees are distinguished leaders with long records of service to the community,” Grover said in a prepared statement. “They could not allow the actions by the Borough President to go unchallenged. They brought this action to assert the independence of the Library and the right of every trustee to act without political interference. They are understandably disappointed by today’s outcome but remain true friends of the library and hope for its continued success.”

The case, Arrington et. al. v. Katz et. al., had taken an unexpected turn Monday when the jurist who had been hearing it, U.S. District Judge Roslynn Mauskopf, recused herself. Mauskopf had learned late Friday of an internal investigation at the library that was prompted by a “whistleblower complaint” filed by George Stamatiades, one of the plaintiffs. The investigation, she said in announcing her recusal, is being conducted by an attorney with whom she has a “very close friendship.”

That attorney is former U.S. District Court Judge Barbara Jones, who is now with the Manhattan law firm Zuckerman Spaeder.

“The relationship I would characterize is like that of a close relative and of a degree not just with the investigator, but the broader family of the investigator,” Mauskopf said, according to a transcript of the proceedings.

The case then went to Brodie.

The ex-trustees were stripped of their positions shortly after a new state law took effect allowing Katz and Mayor de Blasio, whose offices together name all board members, to dismiss their respective appointees at any time. De Blasio fired two more the same day, but they did not sue.

The sextet claims Katz’s action is an illegal power grab and the new law unconstitutional because the library is a private institution. Though it gets about 90 percent of its funding from the taxpayer, the vast bulk of that from the city budget, the library is a nonprofit, state-chartered organization under contract with the city. It was set up that way specifically to avoid political interference, which is what the fired trustees allege Katz is engaged in.

The law and the firings came on the heels of the financial controversy surrounding the library, especially its president and CEO, Tom Galante. At issue, at least publicly, are the hours Galante works while maintaining a second job, renovations done to his office, his nearly $400,000 salary and his contract, which had been automatically renewed every day for another five years.

The members who were let go were part of a faction on the board that had voted against putting Galante on paid leave while a federal investigation of the library plays out; and also voted against providing to City Comptroller Scott Stringer all the financial records he demands for an ongoing audit.

The library has provided those records dealing with its spending of public funds but not those concerned with the private funds that make up the remainder of its revenue — as per an agreement reached in a court case with a former comptroller. Stringer, however, insists upon seeing all records in light of the scandal and has taken the library to court to get them.

He issued the following statement Wednesday in response to the court ruling:

“The Queens Library trustees who brought this suit acted solely in their own interest and not the public’s. My audit of the Queens Public Library was a direct response to allegations of gross mismanagement, self dealing and worse. Trustees have a fiduciary duty to serve the institution, not themselves.”

“Now that Judge Orenstein has paved the way for new trustees to join the Queens Public Library Board, the Board should vote to provide the necessary documents my office needs to complete an audit. Once the books are finally open, my audit will give the public a full picture of the library’s finances and management.”

De Blasio and Katz will now take turns appointing new trustees. The mayor on Tuesday named to the board Jukay Hsu, a Flushing native and founder of a technology incubator in Long Island City who served on his transition team, according to library spokeswoman Joanne King.

Eight remaining trustees, including Chairman Gabriel Taussig, issued a statement Tuesday pledging to move forward.

“While we are still reviewing today’s action by the court, the Queens Library Board and its committees will be working throughout the months ahead to implement changes to the Library’s by-laws mandated by state law, improve transparency, and adopt best practices of not-for-profit corporate governance,” they said.

“Our focus is not on the courtroom, but in the boardroom and at the branches across the borough that we are responsible for.”

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