VIRGINIA CITY - A former Storey County School District employee dropped a lawsuit she had filed against the district for slander.
Karen Watson, former director of special education and personnel, filed a wrongful termination suit against the school district and four members of the school board in July 1999.
Board President Carol McCracken said the two sides reached an agreement Aug. 18 in Reno under which Watson agreed to drop the suit and district officials agreed not to "seek reimbursement for money received in error for sick leave and vacation leave that she had not earned."
The eight-count complaint stemmed partially from a conversation overheard in a Virginia City bar. It alleged that from April 1997 to June 1999, trustees engaged in a campaign to discredit and defame Watson.
A statement released Friday by the Storey County School District said, "Depositions confirmed that any statements made by board members were true and, therefore, not actionable."
Watson resigned as the school district's administrative specialist in June 1999 to take a similar job with Lyon County School District.
Watson claimed that she suffered "financial hardship" by leaving Storey to take the job in Lyon County.
The district's release said, "Depositions revealed that Mrs. Watson accepted a position in Lyon County for a higher salary than she was being paid in Storey County and suffered no financial loss due to her change in employment."
The complaint, filed in Carson City District Court, named Cynthia Waldow, the school board president at the time, McCracken and former school board trustees Tom Purkey and Georgianne Houser.
On at least two occasions, the complaint alleged that the trustees violated the open meeting law when they discussed Watson's job performance without listing her on the board's agenda.
The district's statement said it was absolved of the accusation because the attorney general determined that the closed session was about another employee.
Gloria McCoy, the administrative assistant to the superintendent, said the school district did not pay $10,000 severance pay to Watson as has been rumored nor did the district pay her attorney fees.
McCracken said Watson testified in the deposition that her attorney fees totaled more than $40,000.
"She dropped her suit because all of her allegations were groundless," McCracken said. "This was all proven through her own witnesses. The district didn't even receive the chance to testify."
Watson said she did not want to comment on the case.
"There was a settlement reached but it was confidential," she said.
She referred further comments to her attorney, Jack Kennedy, who could not be reached.