University of Louisville Foundation fires former Ramsey aide Kathleen Smith
The University of Louisville Foundation fired Kathleen Smith, the longtime top aide to former U of L and foundation president James Ramsey, effective Thursday.
LOUISVILLE, Ky. (WDRB) -- The University of Louisville Foundation fired Kathleen Smith, the longtime top aide to former U of L and foundation president James Ramsey, effective Thursday.
The termination comes two weeks after a scathing forensic investigation commissioned by the university concluded the foundation, under Ramsey, depleted the university’s endowment to fund unbudgeted and secretive spending.
Foundation interim executive director Keith Sherman and board chairwoman Diane Medley confirmed Smith was involuntarily terminated but declined to comment any further on the decision.
In a statement, Smith’s attorney Ann Oldfather said the move violates Smith’s employment contract with the foundation and represents a “cowardly failure” to own up to decisions the foundation's former board members made, as well as sexist behavior.
She said Smith is being made the "fall girl" for the findings of the investigation and implied that Smith may sue the foundation.
“We will speak for Kathleen and a fully-informed jury can decide if she was worth it," Oldfather said.
Smith, a 46-year U of L veteran, played a key role in the foundation as its assistant secretary and was one of several administrators who drew extra from University Holdings, a foundation subsidiary that borrowed from the university’s endowment.
In a letter a few months before he resigned last year, Ramsey appointed Smith acting chief administrative officer of the foundation with a $242,000 annual salary through July 31.
However, the appointment was not ratified by the foundation board as required by the organization’s bylaws, the foundation’s former attorney said.
The foundation placed Smith on administrative leave in September 2016 but continued to pay her under the terms Ramsey had set until Thursday.
The forensic investigation – which Smith’s attorney previously called a “one-sided smear campaign” – includes copies of emails in which Smith “expressed an interest in concealing” the foundation’s $22 million in extra compensation to administrators from public records requests, according to the report.
In 2008, for instance, Smith asked the foundation’s attorney how the legal agreements promising the extra pay to each administrator could be excluded from records requests.
“I am certain that Dr. Ramsey does not want any of these to end up in the hands of the (newspaper),” she wrote.
In a 2013 email to the foundation’s attorney, Smith said there as a need to “protect” University Holdings – the shell company that made extra payments by borrowing from the endowment – and Minerva, a foundation subsidiary company that handled the $22 million "deferred compensation" program, from records requests.
She asked, “how can we move our LLCs into something more obscure that would be difficult to find through (open records requests).”
In that same email, she said, “I would like to make the paper trail to our holdings as obscure as possible” to a former university vice president who at the time was being forced into retirement and, according to Smith, had an axe to grind against Ramsey’s administration.
But in her statement Thursday, Oldfather disputed the report’s assertion that the foundation board didn’t authorize the $22 million compensation program.
“This is a breach of Kathleen’s contract with the Foundation, but worse it is a cowardly failure to stand behind fully transparent salary and compensation decisions that would never be questioned were she one of the highly-compensated men on the these boards,” Oldfather said.