Defamation lawsuit against Shreveport mayor, CAO dismissed, headed for appeal

Defamation lawsuit against Shreveport mayor, CAO dismissed, headed for appeal
Michael Wainwright, one of the plaintiffs in water underbilling and defamation lawsuits against Shreveport and Mayor Ollie Tyler, sits down with KSLA's Nick Lawton.

SHREVEPORT, LA (KSLA) - The lawsuit filed by two men suing Shreveport's mayor and chief administrative officer for defamation was dismissed on Tuesday

In March, Shreveport businessman Scott Pernici and former Shreveport attorney Michael Wainwright sued Mayor Ollie Tyler and CAO Brian Crawford for defamation over comments they made regarding a long-standing fight the two men and the city have had over water underbilling.

Wainwright and Pernici's attorney, Jerald Harper, said that Judge Craig Marcotte dismissed the lawsuit in Caddo Parish Court at a hearing on Tuesday morning.

Harper said the dismissal will be appealed and will be heard again in the 2nd Circuit Court of Appeal within 90 days.

Shreveport City Attorney Julie Lafargue issued these statements on the lawsuit's dismissal:

"The judge found that the mayor and the CAO's comments concerning Mr. Pernici and Mr. Wainwright were protected speech, protected by the Constitution, the First Amendment and that their comments were concerning matters of public concern, concern in the water department and billing, and that those comments were their opinions and that they were protected by the Constitution and a particular statute called the SLAPP statute here in Louisiana."

In 2015, the two men report discovering the city was underbilling its water customers by more than $1 million a year after the city went to a four-tier billing system. The lawsuit alleges that water customers were divided into four tiers based on their monthly usage. The less usage a customer had, the less they would pay for water.

In exchange for bringing the discrepancy to the city's attention, Pernici and Wainwright asked for compensation amounting to 25 percent of the savings the city would accrue the first four years.

Pernici and Wainwright contracted the water consulting group Manchac, which drew up a contingency fee contract "whereby the city of Shreveport would obligate itself to pay a percentage of any enhanced or additional revenues the city realized through the implementation or adoption of any information and/or recommendations provided through Manchac Consulting Group Inc. to the City of Shreveport as a result of Wainwright's and Pernici's research."

Manchac also drew up an accord with the city that included a non-disclosure agreement, meaning details of the underbilling could not be revealed to anyone else.

Pernici and Wainwright claim the city violated the non-disclosure agreement by then taking the underbilling information to its own billing specialist and a third party, Systems and Software, which fixed the billing problem in August.

According to the pair's defamation lawsuit, Tyler released a public statement in October 2016 alleging that Pernici and Wainwright threatened to release the discrepancy to the public if they weren't paid for it.

The lawsuit alleges that Tyler's statement, in part, read:

The outside parties involved demanded, initially $250,000 for the information and a contract for future work. The last demand which threatened to expose this to the public rose to $1.8 million. I have been steadfast in my convictions to not allow the City to be extorted or blackmailed on the backs of the citizens.

The lawsuit alleges that Crawford made similar statements in an interview with KEEL Radio in October:

"We get a letter from an individual who doesn't live in our state and says: 'Hey, no, I'm the person who discovered the error in the water bill and I want my money. And if I don't get my money, I'm going to make this public.' So — kind of like a shakedown thing; kind of a — threat....the mayor took it as a threat at that point"

"I practiced law in this town for 40 years, and I'm not going to sit back and let someone label me as being guilty of criminal acts," Wainwright said in a March interview.

Copyright 2017 KSLA. All rights reserved.