Palenick lawsuit moved back to Sandoval County

By Eric Maddy
The SCORE

Follow the bouncing case.

Jim Palenick’s lawsuit against the City of Rio Rancho for wrongful termination will be heard in the 13th Judicial District Court after all, after an erroneous filing by the city’s legal representatives initially caused the case to be moved to federal court.

Both lawyers in the case, Randy S. Bartell for the city and Daniel Faber for Palenick, said Thursday morning that the case would be moved back to Sandoval County and the previous assignment of Judge George Eichwald remains intact. No date for the hearing has been set.

Faber originally filed the case in the 13th Judicial District Court in mid-January, and the city was served on Jan. 16. Bartell, a Santa Fe-based attorney who was hired by the New Mexico Municipal League on behalf of the city, filed his response in federal court, contending since Palenick no longer resides in New Mexico that federal court had jurisdiction. The answer, filed under case number CV-08-178, was filed last week and formally served on Faber on Monday.

But under Section 1441 (b) of the Federal Code, any civil action “shall be removable only if none of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.” Translation: Since Rio Rancho is in New Mexico and is the defendant, the case could not be removed to federal court.

“We agree that federal diversity jurisdiction was not properly invoked, so we agree that it should go back to state court,” Bartell said in a phone interview.

“I believe it’s as if nothing happened. I believe that the detour doesn’t change anything that was going on at the state court level.”

Asked if he timeline and assignment of judge would remain he same, Bartell said, “As far as we are concerned, that is correct.”

Said Faber, “It’s back where it belongs. The case should be heard in the district where these events occurred.”

Palenick’s suit contends he should still technically be considered an employee because he dismissal was decided upon during a “rolling quorum” of city councilors and then-mayor Kevin Jackson. The attorney general’s office did issue a letter saying the city did violate the State Open Meetings Act in the way it came to decide to fire Palenick, but that opinion does not carry the weight of law.

Palenick is seeking payment of $10,000 per month in back salary, plus benefits.

In response, the city believes Palenick forfeited all future judicial claims when he accepted an $110,903.51 settlement that was part of his employment contract with the city. Bartell’s response also includes a counterclaim for return of the buyout plus interest, and also requests attorney fees and “such other and further relief as the Court deems proper.”

Crystal Heir, staff attorney for the 13th Judicial District Court, said the paperwork shuffle hasn’t caught up to her office yet.

“The only thing in the district court file is the actual complaint,” she said. “There’s nothing pending. No hearing has been set. We don’t even have return of service yet. It was filed on Jan. 15. So right now it is what we would call the service phase, getting the complaint served on the City of Rio Rancho and waiting for an answer. That’s where it’s at.”