Anaheim settles discrimination lawsuit from city’s first Latina attorney for $1.45 million

Anaheim and its former city attorney have reached a $1.45-million settlement to end a lawsuit over whether the longtime employee was ousted from her job in 2013 because she is Latina, officials said Tuesday.

Cristina L. Talley’s suit claimed that after a 16-year career working for Anaheim’s government — the last four as its top lawyer — she was forced to resign in January 2013 by a select group of council members.

Talley alleged her firing violated her due-process rights as a government employee. She also alleged harassment: some of the five-member council questioned her loyalty and offered vague critiques of her work, according to court papers. Some on the council implied she could not be objective while handling matters involving the Latino community, she alleged in legal papers.

Around the time of her ouster, Anaheim faced a lawsuit from the American Civil Liberties Union that said the city’s at-large system of electing the council resulted in poor representation of Latinos, who number 53% of the population. None of the city’s five council members were Latino.

Talley, who was 56 at the time of her termination, was replaced by a 40-year-old white man who was given a higher starting salary than Talley’s final salary, according to court papers.

City officials had long countered that Talley’s lawsuit lacked merit, noting that she did not mention discriminatory treatment before her termination or in her formal resignation letter, despite her familiarity with the city’s procedures for reporting allegations of mistreatment.

A city-commissioned inquiry by a Los Angeles law firm determined Talley’s allegations of discrimination and breach of contract were unfounded, according to court papers.

In announcing the settlement, the city said Talley would receive $750,000 and her law firm, the remaining $700,000.

“As confident as we are in our position, the reality of our legal system is that it is more cost effective to settle than to seek our day in court,” Anaheim spokesman Mike Lyster said. The city had already racked up about $800,000 in legal fees since the suit was filed in Orange County Superior Court, Lyster said. The suit was later removed to federal court.

The law firm representing Talley, Borton Petrini LLP, did not confirm how it would divide the settlement but said its client was “very pleased.”

However, the firm said, “No amount of money can fully compensate Ms. Talley for the damage caused by her meritless termination.”

Talley joined the city of Anaheim in 1996 after a stint as Pasadena’s acting city attorney, and she was elevated to the city attorney post in 2009.

By 2012, the city stated in court papers, the majority of the city council “was unhappy” with Talley’s work. In court papers, the city said the council believed Talley favored Mayor Tom Tait and kept poor communication with other members of the council.

Late that year, a judge also voided a multimillion-dollar tax subsidy approved by the council for hotel development, ruling it was a violation of the Brown Act, the state’s open-meeting law.

The council called for a performance review in August 2012 in which three members said Talley “needs improvement,” while two opined that her work “far exceeds expectations,” according to court papers.

Six months later, on Jan. 29, 2013, Talley faced a second performance review in which a majority of the council voted behind closed doors to ask for her to resign within 48 hours.

Depositions in Talley’s lawsuit cast a light on some of the confidential deliberations about her firing. Excerpts of some depositions were included in court papers.

One council member, Jordan Brandman, testified that Tait warned colleagues on the council: “’You’re all making a big mistake…. Are you aware that she is also the city’s first — not only the city’s first female city attorney, but the city’s first Latino city attorney?’”

Brandman said Tait added: “’This is vindictive.’”

Talley alleged the so-called performance evaluations were scheduled on short notice, with nebulous critiques that lacked specifics.

For the second review that resulted in her termination, Talley said she was deprived of notice to rebut allegations or respond to proposed discipline.

Talley claims she spoke of mistreatment with co-workers, but the city has said she should have reported allegations of discrimination to human resources. The city’s defense lawyers note that she did not mention discrimination or harassment in her resignation or exit interview, according to court papers.

She filed a complaint with state regulators nearly a year after her resignation. Once the city learned of Talley’s allegations in March 2014, officials hired an employment lawyer to conduct an internal inquiry, according to court papers.

“The review resulted in a lengthy report that concluded that the claims were without merit,” according to a statement issued Tuesday by the city.

Since Talley filed her original suit, the courts have whittled down her claims, and a federal judge recently tossed out her gender discrimination and retaliation counts. A trial had been scheduled for Oct. 25.

Talley joined the private law firm Best, Best & Krieger LLP and in recent years has worked as the interim city attorney in Merced and Riverside.

matt.hamilton@latimes.com

Twitter: @MattHjourno.