Settlement proves elusive in Holcombe lawsuit

TUPELO – Negotiations are at a standstill in the city’s legal settlement with its former chief financial officer, Daphne Holcombe.
Attorneys on both sides said Tuesday that they still hadn’t reached a settlement nearly six weeks after one seemed all but assured.
“We’re still concerned about city spending and about her own income tax liability on the settlement,” said Jim Waide, who represents Holcombe. He declined to elaborate.
Paul Watkins with the Mayo Mallette law firm in Oxford, which represents the city, also confirmed the lack of settlement.
The former CFO filed her suit against the city in December. She claimed Mayor Ed Neelly violated her First Amendment rights and sexually discriminated against her by forcing her to resign after she objected to various financial practices. When she refused to step down, Neelly fired her.
Holcombe later amended her lawsuit to name Neelly personally as a defendant.
Both sides reached a tentative deal during an April 23 mediation in the U.S. District Court of Aberdeen before U.S. Magistrate Judge Jerry A. Davis. It lacked only Tupelo City Council approval before being official, attorneys said at the time.
The City Council went into executive session May 5 to discuss the possible settlement but emerged without voting on it. Nothing has been done publicly since that time.
A new City Council will take office July 6, offering a new possibility for negotiations.
If the parties fail to reach an agreement, the case will go to trial, which has been set for June 7, 2010, in the U.S. District Court in Aberdeen.
Holcombe seeks actual damages from the city and actual and punitive damages from Neelly. And she wants her job back.

Contact Emily Le Coz at (662) 678-1588 or emily.lecoz@djournal.com.

Emily Le Coz/NEMS Daily Journal