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REGIONALREPORT Triangle

What’s incarceration to loss of reputation? 

When accused of a crime you didn’t do, why is being suspended from a prestigious university worth more in damages than rotting in prison? Because, in the first case, you’re settling with a private-sector target with deep pockets. A recent Internal Revenue Service tax lien for $6.5 million suggests that Duke University paid Reade Seligmann, one of the lacrosse players wrongly charged with raping a stripper (cover story, January 2008), a settlement between $15 million and $20 million in 2007. If the other three players that were suspended got the same, the school paid between $45 million and $60 million to make the problem go away.

That’s a lot more than you’ll get for being unjustly imprisoned, which is generally restricted by statute to $50,000 a year, for a maximum of 15 years — $750,000 tops. In February 2010, the North Carolina Center on Actual Innocence in Durham, which represents those wrongfully convicted, obtained the freedom of Gregory Taylor, a Cary man who spent 17 years in prison for a murder he didn’t commit. “That meant he spent the last two years in prison for free,” Executive Director Christine Mumma says.

Factors other than fairness play a part. For one thing, prosecutors and judges can’t be sued for putting the wrong person behind bars, says James Coleman, a Duke law professor and national expert on wrongful convictions. Corporations hold no such immunity. That gives more bargaining power to potential plaintiffs and boosts pressure for a private enterprise such as Duke to settle, rather than suffer the costs and public-relations consequences of a long legal fight.

The state can be sued for wrongful incarceration, but anyone who accepts the standard settlement waives that right. Those who choose to sue usually must prove “egregious conduct on the part of the police, such as civil-rights violations,” Coleman says. Sometimes it pays off. In 2004, a judge awarded Alan Gell $3.9 million after ruling that he had been wrongfully convicted of first-degree murder in 1995 on the basis of evidence fabricated by the State Bureau of Investigation. Gell had spent nine years in prison, including four on death row.

Legal experts say the disparities between settlements such as the lacrosse players received and compensation for those wrongfully imprisoned represent thorny issues for the justice system, which must consider the value of freedom as well as the free-market worth of reputation, earnings potential and other factors for the wrongfully accused. A Duke spokesman and Seligmann’s lawyer declined to comment. Mumma, though not involved in the lacrosse case, says the players’ lawyers likely took such a tack in their negotiations with the university, which suspended the players after they were charged with rape. Similar principles are at stake in the case of those wrongfully imprisoned, except the pay and living conditions are worse. “Is there an inequity?” Coleman asks. “No question.”

A $30 million lawsuit filed by Seligmann and two other players, David Evans and Collin Finnerty, against the city of Durham, its police department, former District Attorney Michael Nifong, who was disbarred and forced from office for wrongfully prosecuting the Duke students, and several others, remains pending. Nifong, who filed for bankruptcy, contends that he can’t be sued for his performance as prosecutor.

 
GARNERConAgra Foods will close its Slim Jim factory May 27. The Omaha, Neb.-based company previously said the plant might stay open as late as September while it prepared to move production to Troy, Ohio. About 235 will lose jobs this month; the remaining 200 will be let go as production winds down.

ROXBORO — Cleveland-based Eaton plans a $23.3 million expansion of its auto-parts factory here, adding 120 jobs within four years. That will bring the total to about 320. The new jobs will pay an average of $35,875 a year. Person County’s average is $32,136.

RESEARCH TRIANGLE PARK — Rick Weddle resigned as CEO of Research Triangle Foundation, the nonprofit that oversees Research Triangle Park. He took a job as CEO of the Metro Orlando Economic Development Commission in Florida. Liz Rooks, executive vice president of the foundation, became interim CEO

CHAPEL-HILL — Federal marshals raided a Kentucky warehouse and seized an estimated $16.5 million of the prescription drug Auralgan Otic Solution, which is made by Deston Therapeutics. The U.S. Food and Drug Administration says it has not approved Auralgan, used to treat pain from ear infections.

DURHAMInspire Pharmaceuticals cut 65 jobs — about 27% of its workforce — and stopped efforts to develop a treatment for cystic fibrosis in the wake of disappointing test results. The drug developer will focus on its eye-care business.

DURHAM — Contract-research company Health Decisions plans to add 60 employees this year, increasing its workforce to 178. It cut 75 jobs last year because of the economic slowdown but has attracted new clients.

DURHAM
— Former Burt’s Bees CEO John Replogle left to become CEO of Seventh Generation, a Burlington, Vt.-based maker of household products. Chief Financial Officer Doug Haensel is interim CEO of Burt’s Bees, which makes lip balm, lotion and other products.

DURHAMPatheon, a contract manufacturer of brand-name prescription drugs, hired a new CEO. James Mullen, former CEO of Weston, Mass.-based drug maker Biogen Idec, succeeds Wesley Wheeler, who was ousted in December.

CARYSAS Institute bought Assetlink, an Indian developer of marketing software. Terms weren’t disclosed. Assetlink employs 60, including 12 in California.

Merck & Co. plans to add 150 employees this year at its factory in Durham, increasing its workforce to about 600. The Whitehouse Station, N.J.-based drug maker is preparing to package and grow vaccines for chicken pox and other diseases. In an unrelated matter, it agreed to sell a contract-manufacturing plant in Morrisville to Fujifilm Holdings of Japan. Terms weren’t disclosed. Fujifilm, which makes cameras and medical scanners, is expanding into drug development. It is expected to keep all 370 employees.