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November 8, 1991


Ilana Diamond Rovner, United States District Judge.

The opinion of the court was delivered by: ROVNER



 From 1961 until 1981, O'Connor worked as a Chicago police officer. In 1981, O'Connor, who had ties to the administration of then Chicago Mayor Jane Byrne ("Mayor Byrne"), was hired as the Manager of Labor Relations at the CTA. At that time, Mayor Byrne appointees such as Board Chairman Michael Cardilli (Chairman Cardilli) controlled the seven-member CTA Board. O'Connor continued in this job until April 1984, when, in a lateral move, he was named the Manager of Police Liaison at the CTA. In this job, he investigated bribery of CTA officials, misapplication of CTA funds, improper hiring practices, illegal disclosures of information, and coverups of illegal acts. He also served as a liaison with federal, state, and local law enforcement agencies and reported directly to the Executive Director of the CTA.

 By 1983, Harold Washington ("Mayor Washington") had been elected mayor, but it was not until 1986 that he was able to name enough Board members, such as Board Chairman Walter Clark ("Clark") and Howard Medley ("Medley"), to control the CTA Board. With the new Board came a new philosophy about hiring minorities. Up until that time, caucasians filled the vast majority of upper level positions at the CTA. Now, the CTA began an aggressive program to increase the number of minorities employed in those positions.

 To this end, Mayor Washington appointed Joyce Hughes ("Hughes") to be head of the Law Department. Hughes had been a law professor at Northwestern University and had published on the subject of affirmative action. In her new job, Hughes not only supervised legal work at the CTA but also advised the Board and the Executive Director. In November 1986, Mayor Washington had Robert Paaswell ("Paaswell") installed as the Executive Director of the CTA. Paaswell was responsible for day-to-day operations at the CTA and reported directly to the Board.

 Soon after Paaswell arrived at the CTA, O'Connor and Jon Roth ("Roth"), the Director of the CTA handicapped rider program, contacted him separately about irregularities in the performance of a contract the CTA had with Art's Transportation ("Art's"), a bus company that provided service to handicapped riders. Art's was owned by Art Smith, a major contributor to Mayor Washington who also had connections at the CTA with Ernest Sawyer ("Sawyer"), brother of Chicago Alderman and future mayor, Eugene Sawyer. Sawyer, a deputy executive director, oversaw the Art's contract and supervised Roth. Roth's audit of Art's records revealed that the company had fraudulently billed the CTA for work it had not provided and was paying a salary to five CTA employees, including Sawyer's mother-in-law Ruth Kocher, in violation of CTA policy. In addition, Roth informed Paaswell that an Art's official had attempted to bribe him.

 After reporting this information to Paaswell, Roth was "taken to the woodshed" by Sawyer for writing this report. (Plaintiff's Exhibit 37 at 253-54, 259-60). Sawyer cited a concern with the potential for leaks to the press. Sawyer also told Roth that he would not get ahead at the CTA by such acts. By January 9, 1987, the story had in fact been leaked to the press and received fairly extensive coverage. Under public pressure, Sawyer imposed contract sanctions against Art's. One week later, he removed Roth from his position as head of the CTA handicapped rider program.

 O'Connor was also part of another investigation into corruption after Paaswell became executive director. In late 1986 and early 1987, O'Connor and Peter Zelkovich ("Zelkovich") conducted an investigation into the performance of a $ 38 million contract between the CTA and a fuel supplier, Metropolitan Petroleum Company ("Metropolitan"). Zelkovich was the Manager of Internal Auditing at the time. His audit revealed that Metropolitan's invoices were being delayed so that the CTA would not receive a discount under the contract. (Plaintiff's Exhibit 53). The audit also showed that Metropolitan had lied about using a minority sub-contractor, as required by the contract, and was supplying the CTA with substandard fuel. After this report was given to the Board, several Board members spoke out publicly to defend Metropolitan, including Medley and Chairman Clark. Clark also reprimanded Zelkovich in writing for this audit. Medley and several CTA employees were subsequently tried and convicted of accepting bribes from Metropolitan in order to influence the Board and discredit the audit report.

 O'Connor was a part of other investigations during Paaswell's tenure. For instance, he investigated actions by CTA management involving unusual hiring practices. O'Connor noted that after Paaswell became Director in late 1986, race began to play a major role in hiring senior-level staff at the CTA. O'Connor's Department was no longer asked to perform background checks of new CTA employees as it had done previously. For example, one of Hughes' Law Department hirees, Jerome Butler, was not investigated. Another attorney hired during this period was later found to be practicing without a law license. (Plaintiff's Exhibit 42 at 17). The background checks were subsequently reinstated.

 Although O'Connor had promised Paaswell that he would investigate the Art's investigation further, on February 27, 1987, Paaswell instructed O'Connor to turn over his files concerning the investigation to the Law Department. On that same day, Paaswell suspended O'Connor with pay for ten days. The suspension was needed, according to Paaswell, to investigate whether O'Connor had hired, without proper authorization, CTA security dispatchers to work with police officers patrolling buses and trains, and whether he had hired a parking lot attendant in 1986 under the same circumstances. (Defendant's Exhibit 21 and 24). While on suspension, some of O'Connor's investigative files were removed from his office, and his mail was opened.

 After the suspension, O'Connor filed this suit in district court claiming that he was suspended because of his race, his political affiliation with former Mayor Byrne, and his investigations. (Defendant's Exhibit 4). In response to the suspension charges, O'Connor claimed that his supervisor, Larry Pianto, had authorized the hiring of the dispatchers and that Paaswell and Hughes had been advised of the situation. (Plaintiff's Exhibit 24). He contended that he hired the summer parking lot attendant with the authority of then Chairman Cardilli. On April 6, Paaswell sent O'Connor a written reprimand warning him to comply with the CTA's hiring procedures in the future.

 At about the same time as the suspension, Paaswell began to reorganize his administrative offices. As a part of the reorganization, Paaswell combined O'Connor's Police Liaison Department with the Industrial Safety Department. In doing so, Paaswell created a new position, Manager, Industrial Safety/Police Liaison, to oversee both Departments. He considered O'Connor for the job but chose not to hire him based on what he knew about O'Connor and O'Connor's job performance evaluations. (Defendant's Exhibit 35 and 36). The job went instead to Melvin May ("May"), an African-American who had a ...

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