Friday, April 2, 1999

Final arguments
bring out emotions at
Lindsey trial

By Rick Daysog


It's been described as the biggest court case since statehood. A battle for the control of one of the nation's richest charitable trusts. A modern-day morality play.

The historic, four-month trial over the suit to remove Bishop Estate trustee Lokelani Lindsey came nearer to an end yesterday with heated closing arguments over what could result in the first dismissal of a trustee in the 114-year history of the estate.

There was drama, there was laughter, there were tears.

"After being together for so long, it seems like a court of law should have something akin to a benediction," Circuit Judge Bambi Weil said, summarizing the mood of the courtroom after more than seven hours of arguments from lawyers for the estate's five trustees and the Attorney General's Office.

Weil - who now will pore over thousands of pages of evidence and trial testimony from more that 70 witnesses - gave no indication when she plans to make a ruling, but many expect a decision in the next several weeks.

Trustees Oswald Stender and Gerard Jervis sued for Lindsey's removal in December 1997, saying she breached her fiduciary duties, mismanaged the estate-run Kamehameha Schools, undermined the authority of school President Michael Chun and was unfit to serve.

By Kathryn Bender, Star-Bulletin
Bishop Estate trustee Lokelani Lindsey consults with her lawyers
in the courtroom yesterday during closing arguments
in the trial to dismiss her.

Lindsey, the estate's first female trustee, has denied wrongdoing. Her lawyers have portrayed her as a misunderstood advocate for educational reform who became a target of an unfair rumor campaign.

They argued that the full board gave Lindsey broad powers to oversee and improve the Kapalama Heights campus.

Yesterday, Stender's lawyer, Crystal Rose, said Lindsey should be removed because she has caused tremendous harm to the students and teachers of Kamehameha Schools and that her continued presence on the board will cause further damage to the trust.

"Mrs. Lindsey's actions have caused a climate of fear and intimidation which hangs like a black cloud over the Kapalama Heights campus," Rose said.

"She has placed her own interest above those of the trust."

Rose cited the December 1997 release of Lindsey's controversial educational report as a major breach of her fiduciary duties. The so-called Lindsey report alleged that the longer students stayed at Kamehameha Schools, the worse they performed as measured by standardized test scores.

The report also said that in 1997 more than 40 graduating seniors could barely read at the 12th-grade level.

Lindsey's study blasted

Rose noted that witnesses who testified about the report, including specialists and Lindsey's supporters, said that many of its key findings were flawed and relied on inaccurate methodology. Lindsey, according to Rose, released the report to deflect blame from retired Circuit Judge Patrick Yim's scathing fact-finder's report which attributed many of the morale problems at the Kapalama Heights campus to Lindsey.

One expert, retired University of California at Los Angeles education professor James Popham, testified that the conclusions in Lindsey's study were "wrongheaded" and that her report displays a profound ignorance if not an ulterior motive.

"It was a reckless and malicious breach of her duty," said Rose, calling the report's release a symptom of Lindsey's "punch and counterpunch mentality."

"Its release was personal and self-serving to Mrs. Lindsey."

Rose also cited Lindsey's alleged misuse of trust funds and her reported waste of estate assets. Lindsey's personal use of estate credit cards, her use of estate personnel to conduct thousands of dollars of certification work on her Punaluu home and her 16 trips to Las Vegas at the estate's expense demonstrate her inability to administer to assets, Rose said.

In 1997, Lindsey "became the champion of the bad computer deal" when she engineered the estate's $3 million investment in a distance-learning technology developed by Arizona-based Education Management Group Inc., according to Rose. The EMG contract, partly based on Lindsey's friendship with an EMG representative, was eventually scrapped by Kamehameha Schools as obsolete, according to Rose.

On another occasion, Lindsey cost the estate thousands of dollars when she persuaded trustees Henry Peters and Richard "Dickie" Wong to purchase a dubious collection of Hawaiiana-related books and photographs from local resident Robert Van Dyke, Rose said.

Lindsey unilaterally authorized the release of about $150,000 to Van Dyke from an escrow account before the collection had been appraised or inventoried, Rose said. The Van Dyke collection has never been used by students or staffers at Kamehameha Schools.

"Mrs. Lindsey was had by a crazy old man who had a lot of rubbish," Rose said. "He saw her coming a mile away."

Michael Green, Lindsey's lawyer, denied that Lindsey misused trust assets, saying the EMG contract and the Van Dyke collection have benefited the trust. Green also noted estate employees' work on Lindsey's Punaluu home was standard procedure.

Although she may have been rough around the edges, Lindsey has been an educator for 30 years and is selflessly committed to the needs of the children of Kamehameha Schools, Green said.

'1-800 Auntie Kokua'

One estate employee, Hannie Anderson, testified that she called Lindsey "1-800 Auntie Kokua" for her readiness to fund gym repairs, school volleyball team uniforms and travel expenses for parents of students who live on the neighbor islands, Green said.

"She's from Kahuku. She's a tita. No disrespect but she knows how to fight," Green said about Lindsey. "She, as the evidence has shown, is the most passionate woman about education."

Much of Green's defense focused on the role of Stender and Chun in the 2-year-old controversy. Chun may have been a popular president but he hurt teacher morale and was unable to develop a strategic plan for the school, Green said.

Stender, meanwhile, orchestrated a rumor campaign against Lindsey by distributing board memos to outside critics and by granting interviews to the local media in which he charged that Lindsey micromanaged the school, Green said.

"I truly believe that the evidence will show that this campus was whipped into a frenzy," Green said.

Meanwhile, a key party to the suit, Jervis, was absent from the proceedings. Jervis is recuperating from an overdose of sleeping pills last month after he and an estate employee were caught in a sexually compromising position in the men's room at the Hawaii Prince Hotel.

The employee, Rene Ojiri Kitaoka, committed suicide the day after the Waikiki hotel incident.

Much of yesterday's court proceedings were marked by a solemn atmosphere in which Lindsey and Stender were reduced to tears by attorneys' arguments. Some members of the audience also cried after Stender lawyer Douglas Ing urged Weil to remove Lindsey to begin the healing process.

"Kamehameha will not emerge from this poverty of character until she has been permanently removed," Ing said.

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