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Scappoose settles with former manager

City paid $10k toward settlement but never discussed lawsuit publicly

SPOTLIGHT FILE PHOTO - Scappoose city councilors conduct business during a council meeting earlier this year. The council approved an expenditure amount for a settlement agreement with former city manager, Jon Hanken, in early June.

A lawsuit filed against the city of Scappoose by its former city manager, Jon Hanken, was settled quietly out of court earlier this month.

Records show Hanken’s suit against the city was dismissed with prejudice on July 14.

Hanken, whose employment contract with Scappoose was severed in November 2013, alleged city officials gave poor remarks about him when they were called by prospective employers from other cities. A non-disparagement clause in Hanken’s separation agreement with Scappoose states the city and Hanken “agree to not make disparaging comments or statements about each other.”

Hanken has since been hired as city manager in Ione, Calif. He filed suit shortly before starting work with Ione.

In his lawsuit, which was filed in Multnomah County Circuit Court on May 28, Hanken sought $800,000 from the city for breach of contract and intentional interference with economic relations.

Scappoose City Manager Michael Sykes confirmed the city paid half of a $20,000 settlement with Hanken. The city’s insurance company, Citycounty Insurance Services, paid the rest.

Hanken declined to comment on the case when he was reached by phone Wednesday. His attorney, Richard Busse, did not respond to requests for comment.

The Scappoose City Council never publicly discussed the lawsuit or the city’s payment of the $10,000, despite public meetings laws that prevent a governing body from making any final decisions or taking any final action in a closed session.

“I don’t honestly remember if we came back and finalized that,” Sykes said Wednesday regarding the settlement agreement.

It’s unclear whether city officials knew the settlement had been finalized.

When reached by phone, Councilor Barbara Hayden said the council was unaware the case had been settled.

“Last we heard they were working on it and we have not been informed that it had finally been settled,” Hayden said.

Sykes said the council indicated its desire to settle with Hanken and gave Mark Williamson, a representative with CIS, direction about how much the city was willing to spend to avoid going to court over the issue.

“They really gave me and the attorney the parameters and the specifics of an [amount] that was agreeable,” Sykes said, indicating he would look into whether the council needed to take any additional action on the settlement.

“A lot of times CIS looks at these with a nuisance value and it’s cheaper to just settle them for a small amount of money than go to court,” Sykes said, calling the matter a “risk management” call.