PSU Claim Payment (and other) Malfeasance

The evidence timeline reveals that a small group of trustees, led by Ira Lubert, used the settlement process as part of the costly scheme to convict PSU in the court of public opinion.

By
Ray Blehar

There is a lot of confusion over the latest Penn State University Board of Trustees (PSU BOT) insurance debacle and misdirected anger at PSU's insurer (the Pennsylvania Manufacturer's Insurance Company) about the release of uncorroborated claimant information.  

Make no mistake, the people at fault for this debacle are former PSU President Rodney Erickson and the PSU BOT's Legal and Compliance Committee.  However, the settlement scheme was just one cog in the wheel of an orchestrated effort to convict PSU in the court of public opinion.

The timeline, as usual, tells the story.

Rolling Out the Red Carpet For Lawsuits
After (then) PSU President Graham Spanier attempted to defend the University from the baseless allegations of a failure to report Sandusky, he was removed and the BOT began a series of actions to convince the public of the culpability of PSU officials in the Sandusky matter.

Nov. 4, 2011:  Sandusky charges were announced.

Nov. 9, 2011:  The PSU BOT announced removal of Spanier and Paterno, leading public to believe PSU officials were guilty of a cover-up.  No vote was held prior to announcement of their removals.

Nov 11, 2011: Then interim (puppet) President Rodney Erickson's 5-Point Promise impled that PSU had a culture that failed to do the right thing and he committed to providing support to the victims.

Awareness of "Hole" of Coverage
Upon receiving the first lawsuit, PSU learns that the policies in effect during the time period when most of the (then) alleged abuse occurred do not cover "abuse and molestation"

Nov. 30th, 2011, John Doe A filed a civil lawsuit against The Second Mile and Penn State for his alleged abuse suffered from 1992 through 1996.

Jan. 6, 2012:  PSU filed a claim with PMA for coverage under its comprehensive and commercial general liability (CGL) policy.

Jan 30, 2012:  PMA issued a reservation of rights letter denying coverage under the CGL policy because of its "abuse and molestation" exclusion in effect after 1992.  In addition, PSU policies have "intentional acts" exclusions and prohibit punitive damages.

Attempt to Side-step "Hole" In Coverage
PSU will file bodily injury claims to circumvent abuse and molestation exclusion.

Jan 31, 2012:  The President Rodney Erickson's personal notes, dated January 30,  indicated a plan to submit abuse claims as bodily injuries and utilize Hershey Medical Center to record medical expenses against the claims.

Feb 15. 2012:  PSU filed a lawsuit against PMA seeking payment of the (bodily injury) claims for John Doe A.

Freeh Report, NCAA, and Lawsuits
With the understanding that intentional acts are not covered under its insurance policy, a small group of trustees embrace the allegations in the Freeh Report that place blame on PSU officials.  In the following ten days, this group negotiates a set of sanctions and harsh financial penalties from the NCAA.  This action is a continuation of the small group's goal of convincing the public of the culpability of Paterno, Spanier, and others for not preventing Sandusky's abuse.

July 12, 2012: The Freeh Report was issued claiming PSU officials were aware of Sandusky's sexual abuse of children and concealed the abuse.  


July 12, 2012:  PSU officials Karen Peetz, Rodney Erickson, and Kenneth Frazier publicly praised the Freeh Report as comprehensive and thorough, admonish Paterno, Curley, Schultz, and Spanier for their failure to protect children, and pledged to reform PSU by following the report's recommendations.

July 23, 2012:  The President Erickson signed a Consent Decree with the NCAA and agreed to pay $60 million in fines for sexual abuse prevention and victim programs.  The Consent Decree's language quotes from the Freeh Report.  Action was approved by PSU BOT Executive Committee.

July/Aug 2012:  Sandusky victims from trial and elsewhere file lawsuits against PSU.

Some Settlements Approved 
Despite knowing that it is not insured for abuse and molestation claims from 1992 to 2004, the University begins settlements with trial victims who were abused during that time frame.  Erickson understands that some of these claims will not be covered and infers that they will be paid from internal loan interest (residing in the Institutional Support Budget).  While Erickson stated that Penn State wanted a "just outcome for the victims," the underlying motive for the settlements was as a demonstration of the University's culpability for Sandusky's abuse.

Sep 19, 2012:  In a Bloomberg interview, then President Erickson stated that settlement money would come from insurance and internal loan (interest).

Sep 20, 2012:  PSU hired Feinberg Rozen to moderate and settle claims.

Lubert: Board Member
at PSU & Second Mile

Oct 26, 2012:  Subcommittee on Legal and Compliance, then chaired by current BOT Vice-Chair Ira Lubert, approved settlement actions in Sandusky related matters.  Lubert was formerly a regional director at The Second Mile charity.

July 12, 2013:  Subcommittee on Legal and Compliance propose approval of claims.  Committee members included: Ira Lubert (chair); Kenneth Frazier (vice chair), Keith Masser (ex officio), Kathleen Casey, Richard Dandrea, Keith Eckel, George Greig, and Adam Taliaferro.  Approved by PSU BOT Executive Committee.

Oct 28, 2013:  26 of 31 claims settled for the amount of $59.7 million.  3 claims were denied (D.F. claim among them) and 3 claims agreed to in principal (Victim 6 and Victim 9).  The settlement agreements contained a provision that the claimants cannot file additional lawsuits against The Second Mile.

More Lawsuits and "Freeh" Money
Unable to come to terms with Penn State, Victims 6 and 9 use discovery of the Freeh Source materials to extract additional money from the University.

Nov 22, 2013: After being unable to reach agreement, Victim 9 files a lawsuit relying heavily on information from the Freeh Report to prove negligence on the part of Penn State.

Mar 18, 2014: After being unable to reach an agreement, Victim 6's legal team is awarded discovery of some of the Freeh Source materials.

Sep 3,  2014:  Victim D.F. sues PSU, also citing Freeh Report to prove negligence.

Dec. 5, 2014:  Victim X sues PSU, claiming abuse in 1988, argues his case would have been within the statute of limitations if not for PSU's failure to report in 2001.

Jan 1, 2015:  Victim 9 legal team awarded discovery of Freeh Source materials.  PSU was required to turn over all materials d by May 29, 2015

Apr 12, 2015:  By an 18-6 vote,  the BOT approves a substantial and undisclosed settlement for Victim 9 (estimated at between $15 - $20 million) and for five other claimants.  Total payment of approximately $33.2 million.

Judge Slams Door on Reimbursements
In an outcome that should have been a surprise to no one, Judge Glazer ruled that PSU's case for reimbursement for the claims from between 1992 and 2004 were essentially denied.   In his ruling, he frequently referenced the Freeh Report to justify that PSU was negligent, especially noting the timeframe from 1998 to 2001. Moreover, PSU attempted to refute the Freeh Report findings that PSU officials knew about Sandusky's behavior, but the arguments were refused by the Judge due to - among other things -- the University's acceptance of fines and sanctions from the NCAA. 

32 claims were paid by PSU for a grand total of $92.8 million.

What we know:

1.  PSU is not entitled to reimbursement for the claims between 1992 and 2004, which include at least eight victims: Matt Sandusky, Victim #2, John Doe A, Victim #3, Victim #4, Victim #5, Victim #7, and Victim #10.  Estimated Loss:  $12 million.


2.  PSU can receive $3 million aggregate limit for three claims paid from 2005 and 2006.  This coverage would include the exorbitant ($20 million) claim paid to Victim 9, a payment to Victim 1, and one other payment.  Estimated Loss: $21 million.

3.  PSU can receive full coverage for three claims prior to 1992. The ruling notes claims from 1976, 1987, and 1988. Estimated Coverage: $6 million.

What we don't know:

How many of the eighteen remaining claims fell within the 1992 to 2004 time frame that is not covered and how many occurred prior to 1992 and are fully covered.

The Bottom Line
The Committee on Legal and Compliance knowingly made a decisions to pay out at least $32 million that they (and Erickson) knew would not be covered by insurance.  

In news that surprised no one who closely followed this fiasco, the University went on record to admit that the Committee and Feinberg Rozen did not require evidence to support the allegations made in the claims.  At this point, we now know what Eric Barron meant in his video stating that some people don't believe Paterno's statue should be returned because of what they know.

Who are they? Lubert, Frazier, Peetz, Dambly, Eckel, Casey, and Dandrea.  And they are all trustees who stood by the Freeh Report and did everything possible to ensure that it never got reviewed.

It is highly probable that if the Judge hadn't released the uncorroborated information about reports to Paterno in his ruling, one or some of these trustees would have leaked the information to the press -- on or about the time the alumni-elected trustees were going to finally toss the Freeh Report on the ash heap of history.

The settlements by this cabal of trustees and their efforts to protect the false and harmful narrative that was put forth by the Attorney General, the Freeh Report, and the NCAA were all part of an ongoing effort to convict Paterno, Spanier, Curley, and Schultz in the court of public opinion.

The purposeful damage done to the University by their actions is immeasurable and should qualify as malfeasance.

"Freeh source materials" confirm the Curley File

Freeh Report source materials already in the public domain, combined with other evidence, confirm that Tim Curley had a file on Sandusky -- and its contents found their way into the so-called Schultz "secret file"

By

Ray Blehar 

Even though the alumni-elected members of the Penn State University (PSU) Board of Trustees (BOT) have succeeded in gaining access to the Freeh source materials, the court sided with Old Main to keep the information from being publicly disclosed.

Regardless of that ruling, and likely unknown to the public, some of the Freeh source materials  are already in the public domain - and they prove that evidence was manipulated and/or tampered with in order to railroad PSU officials (i.e., Curley, Schultz, and Spanier).

However, when the source materials are combined with other existing evidence, the totality of the evidence confirms that former PSU Athletic Director (AD) Tim Curley had information related to the Sandusky matter -- and that information was illegally placed into the so-called "secret file" of former PSU VP for Finance and Business, Gary Schultz.

The Key Evidence?

What appears to be a seemingly insignificant document -- a February 11, 2001 computer printout that lists the names of the Board of Directors of The Second Mile (TSM) and its date/time stamp -- turns out to be a very key piece of evidence.

According to the Freeh Report (at 71), on "February 12, 2001, at about 11:10 AM, Schultz researched the internet about the Board members of The Second Mile, the charitable organization Sandusky founded."

The passage is referenced to End Note #303: Schultz confidential file notes (5-1-12), however this printout -- that was printed at the exact same time "Schultz researched the internet" -- was not included in the Freeh Report.  Had it been included, most reasonable people (not Sally Jenkins) would have concluded that Freeh was making quite an evidentiary leap to tie an unlabeled computer printout to a specific individual.  In short, Freeh excluded the print out as a matter of maintaining his (alleged) credibility.

The document wasn't introduced as evidence in any legal proceeding to date -- for a very good reason.

The timeline of evidence does not support Gary Schultz searching for the names of members of the TSM Board on February 12, 2001.

Curley, Not Schultz, Concerned About TSM

Freeh Report Exhibit 5C, the February 12, 2001 "Confidential" hand-written note of Gary Schultz outlined an early plan for addressing the 2001 incident.  Schultz made no mention of  TSM in that plan.

According to the grand jury testimony of Curley (at 181 and 188), he originated the plan to inform TSM about the 2001 incident  and proposed it during the February 25, 2001 meeting with former PSU President Graham Spanier and Schultz.

Freeh Report Exhibit 5G, Schultz's February 28, 2001  email  also confirms Curley proposed informing TSM: "we will inform his organization, with or without his cooperation (I think that's what Tim proposed)."

Schultz also memorialized Curley's plan, which included discussions with TSM, on February 25th and 26th, in handwriting (Exhibit 5G) and by email (Exhibit 5F), respectively.

Finally, Freeh Report Exhibit 2J, the notes of Graham Spanier, also confirm that Curley was very concerned about his impending interaction with TSM.

In summary, this evidence reveals that Curley came up with the plan to talk to TSM and had concerns about the charity's reaction.  Given the evidence, it was Curley - not Schultz -- who printed out the names of the TSM board members on February 12th.

While the printout turns out to be a very significant document in the grand scheme of things, it's not the only "source" document that provides evidence of manipulation and/or tampering.

March 7, 2001 Email Manipulation/Bias

A March 7, 2001 email allegedly obtained from the so-called "secret file" of Gary Schultz, memorialized a discussion between  Curley and Schultz's former administrative assistant Joan Coble, regarding Curley's follow up on the plan to address the incident.

Freeh Report's Exhibit 5I of the email is on the left, while the source document (introduced as Commonwealth's Exhibit 18 at the July 2013 preliminary hearing) is on the right.

The evidence shows that the Freeh Report exhibit was printed from an email file and was not the full email discussion between Coble and Curley.  The Freeh Report excluded any mention of Curley's affirmative response that he had followed through on the plan by March 7th.  Note that March 7th is the circled date at top of the full email.

This is significant because the Freeh Report stated, without equivocation, that Curley met with TSM on March 19, 2001.  However, the Freeh Report's March 19, 2001 date is based on a hearsay statement from an unnamed legal representative for TSM.

The Freeh Report's conclusion of the March 19th meeting between Curley and TSM was also refuted by Spanier's notes (Freeh Exhibit 2J).  Spanier wrote that he met with Curley shortly after their late February meeting that the former AD had followed through on the plan to speak with TSM.

The Freeh Report made several inferences that Spanier had been less than honest with the Freeh investigators, thus excluding the critical evidence of the March 7th date was two fold:  to support the Freeh Report conclusion of a March 19th meeting and to undermine the credibility of Spanier.

As shown in email obtained by PSU alumnus, Ryan Bagwell, Freeh made it a point to alert personnel conducting Spanier's background investigation for a security clearance about evidence found during the (criminal) investigation.  Spanier would eventually lose his clearance as a result of the charges against him.

The evidence manipulation to persecute PSU officials certainly was more widespread than those documents.  Over 80 documents cited as sources in the Freeh Report were excluded, and most importantly, some of the most critical missing evidence is tied to the Curley/Schultz files.

Curley's Notes Turned Over In February 2011

The grand jury questioning by Frank Fina revealed he was not yet aware that Tim Curley possessed any information about Sandusky.  Fina didn't ask a single question whether Tim had taken notes during any of the meetings about the 2001 incident.  In fact, Fina didn't even ask Curley (or anyone else) if they had searched for documents responsive to Subpoena 1179.  Clearly, Fina knew that Baldwin didn't tell these men to search for documents.

According to the Freeh Report (at 84), on February 15, 2011, Baldwin met with members of the football coaching staff to discuss their knowledge of Sandusky.  The next day, OAG investigators were present and conducted more interviews.  It is likely that the search for documents from the football coaches and AD officials occurred then or very shortly thereafter.

OAG special agent, Anthony Sassano later testified that the legal team of Duane Morris delivered boxes of information (he presumed was from Schultz's office)  that contained Sandusky's retirement paperwork.  Duane Morris was the former employer of Cynthia Baldwin -- and she brought in members of that firm in to assist her.  According to a notation on one of the retirement papers (Freeh Report Exhibit 3H), it was received (by someone, but certainly not Louis Freeh) on February 28, 2011 at 6:28 pm.

While the public has been led to believe that the retirement paperwork came from the Schultz file, it is clear that Curley had a copy of it.  As noted on the letter, Sandusky was instructed to return his signed copy to Curley (see below).  This indeed confirms that Curley and/or the AD's office had information related to Sandusky in its possession.

But that's not the only significant issue regarding the Curley file.


More Tampering?
According to the testimony of Joan Coble, she had no specific knowledge of anything in the bottom drawer of Schultz's filing cabinet.  She testified she never looked in the drawer.  As such, Coble's testimony provided no legitimate information regarding the contents of the Schultz file.

Based on the evidence cited previously, by the time Kimberly Belcher removed the file from Schultz's bottom drawer in November 2011, it had been touched by so many hands that the authenticity/integrity of the contents would be compromised.

It also appears that one of the "hands" involved may have tampered with the retirement letter.

Under magnification, it appears that Schultz's signature has been overlaid on a previous signature block. Note that the words "BY UNIVERSITY OFFICER: and "for Finance" do not have shadowing or aliasing around them.

















For the purpose of comparison, here is top of page two at similar magnification, showing the clear, bolder, non-shadowed type as the authentic typeface.

It is highly probable that those who tampered with the evidence did so thinking that Freeh's impeccable reputation would prevent anyone from questioning the authenticity of the evidence and that they could get away with railroading the PSU 3.

Under the patently ridiculous narrative of the Freeh Report, it was the lure of the Penn State football facilities that provided the "very currency" that Sandusky used to attract his victims. With Schultz's signature affixed to the document, each of the PSU 3 (and Paterno) would be tried in the court of public opinon for enabling Sandusky's sexual abuse.

Freeh publicly smeared PSU officials for allowing Sandusky to be on campus after there were no charges or findings against him in 1998.  Moreover, Freeh ignored the evidence that no crimes occurred on campus after 2001, instead stating that abuse continued on the PSU campus through 2009.

As has been demonstrated repeatedly, evidence timelines or chain of custody of evidence can be counted on to undo the false narratives of the cases prosecuted by the PA Corruption Network.

The Chain of Custody of the Schultz Files

According to OAG officials, the notes of Schultz were not provided to them until April 2012 -- by Schultz and his former administrative assistant, Kimberly Belcher.

Louis Freeh claimed, during his highly publicized press conference, that "we found them in conjunction with the Attorney General."  The Freeh Report notes the date of discovery as May 1, 2012.

However, both of those claims are refuted by the notebook of former PSU President Rodney Erickson.  On 31 January 2012, which was three months before the Schultz notes were either turned over to the OAG or "found" by Freeh, Erickson wrote that he was to get copies of the notes of Curley and Schultz.

PSU alumnae Eileen Morgan's excellent analysis of the evidence surrounding the grand jury questioning of Curley, Schultz, and the late former PSU football Coach, Joe Paterno almost certainly proves that Frank Fina received the Schultz file from PSU (i.e., Baldwin) prior to the January 12, 2011 proceeding.

While Erickson's notebook confirms that he knew that Freeh's alleged discovery of the Schultz file and the OAG's pretense that the files were not turned over until April 2012 were both shams, it also confirmed that he was aware of Fina's strategy to get Curley and Schultz to flip.

Based on the analysis of the evidence, it is highly probable that Fina, et al, decided to throw the whole kitchen sink of evidence at Schultz, rather than Curley, in an effort to produce the flip.

The Truth

PSU, under Erickson and new puppet President Eric Barron have paid out untold millions to keep various litigants, including some of its own trustees,  from accessing the Freeh source materials.

In doing so, Old Main and the Old Guard utilized specious arguments or protecting employee confidentiality and that the Freeh Report didn't impact University decisions as a means to keep the alumni trustees from finding out the truth.

The reality of the matter is that Erickson, Baldwin, and others know that it is only a matter of time before the Freeh source materials expose the truth about the Sandusky matter.

And the only thing Erickson, Baldwin, Harmon, Fina and numerous others fear more than the truth is what the truth will eventually do to them.

Corman's "Total Victory" Didn't Silence Emmert or Reveal The Truth

Senator Jake Corman's claim of a "total victory" over the NCAA is being exposed for what it really was -- a spiking of the football on the one-yard line.

By
Ray Blehar

Today's interview of Mark Emmert was more evidence that Senator Jake Corman's claims of a total victory over the NCAA and the organization's surrender were greatly exaggerated.  

USAToday reported that Emmert called the sanctions levied upon Penn State as "right and appropriate."  

In addition, Corman's "total victory" didn't stop Emmert from continuing to hide the fact that he (and former PSU President Rodney Erickson) manipulated the process to result in the draconian sanctions levied on the PSU football program.  Instead, Emmert insisted that the NCAA Executive Committee (EC) had determined the outcome.

Emmert:  "I remain pleased with where the executive committee wound up in that case." 

NCAA EC Was A Rubber Stamp

Ed Ray and the Puppet-Master

The evidence exposed in the lawsuit revealed that Ed Ray, the head of the NCAA EC, had read neither the Freeh Report nor the language of the NCAA Consent Decree before he voted to approve the sanctions.  In fact, on the day the Freeh Report was issued, Ray contacted Emmert to find out when PSU would answer the NCAA's letter of November 17, 2011.

Unbeknownst to Ray, Penn State informed the NCAA in December 2011 that the Freeh Report would serve as PSU's response.  Other documents obtained from Old Main (in the course of my investigation) revealed that Emmert informed PSU (in January 2012) that he would "wait for Freeh Report."

After Erickson, Karen Peetz, and Ken Frazier publicly accepted the Freeh Report, Emmert and Erickson quickly decided to begin negotiating the penalties in a settlement arrangement.  The deposition of PSU BOT Chair Keith Masser (pages 25 and 26) and an email between Don Remy and Gene Marsh also confirmed that the discussions of a negotiated settlement began on Monday, July 16th --  before the NCAA EC first met to discuss the Freeh Report (on July 17th).  The penalties and the language of the consent decree were finalized before the EC met again on July 22nd.

The evidence revealed that the NCAA runs in a similar manner to the PSU Board of Trustees -- a small group makes the decisions which get rubber stamped during the "official vote."

Corman Complicit In Hiding The Truth

While Corman was right about many things about how the University was unfairly treated by NCAA, the above evidence reveals he cherry picked the facts to make the case that former PSU President Erickson was put in a no-win position by the NCAA.  

Jake's spiking of the ball on the one yard line and declaring"total victory" likely kept the "smoking gun" evidence of Erickson's cooperation with the NCAA from being fully exposed.  To date, correspondence between Freeh, Tomalis, and the NCAA, as well as the source materials used by Freeh, remain heavily protected.  

Had Corman not taken his foot off the throat of the NCAA, there is little doubt that PSU's Alumni-Elected Trustees would not have had to file a lawsuit to see the documents that remain hidden.


In another ironic twist, Corman charged the NCAA with utilizing the same tactics of the PSU Board of Trustees Inner Circle when he stated:  "there was a manipulation of the process to get a quick outcome.”  In essence, Corman was unwittingly making the case that PSU and the NCAA were cooperating.

As the evidence in the Sandusky scandal revealed, from November 2011 forward up until the recent decision to settle with more Sandusky victims, it has been the Inner Circle's modus operandi to manipulate the process and preclude meaningful debate to get to a quick outcome.    

It happened in the removals of Spanier and Paterno.  

It happened in the acceptance of the Freeh Report. 

It happened in the negotiations of the NCAA sanctions against the University.  

And, as stated previously, it happened on April 9th in the decision to settle the pending cases (and avoid discovery) in the civil lawsuits by Sandusky's victims.

Total Victory Was Hollow

In the restoration of Penn State's 112 football victories, statecollege.com lauded Senator Corman as Penn State's "knight in shining armor."   

Emmert still claiming victory

Unfortunately, statecollege.com and the rest of the media continue to report that the Sandusky scandal was about football.  Corman, the so-called "knight," did nothing to change that perception.

The bottom line is that result of Corman's lawsuit was PSU agreed to saddle its football program with $60 million in fines in exchange for 112 victories.  PSU remains penalized by the Big Ten and was required to enter into a new consent decree and Athletic Integrity Agreement with the NCAA

Corman's "total victory" was hollow...and Emmert knows it.

An Act of Bad Faith: The BOT's & NCAA's Railroading of Paterno & PSU

A construction of the Freeh investigation timeline and other evidence shows the NCAA didn't influence the outcome of the Freeh investigation or bluff PSU.  The inconvenient truth is that Erickson knew the NCAA had no grounds to penalize PSU, but collaborated with them to railroad Paterno and the University.

By 
Ray Blehar

The NCAA has slithered away from the Corman/McCord lawsuit with its reputation somewhat intact due to a settlement that still has PSU paying fines and also making quarterly payments to flim-flam man, George Mitchell.  Worst of all, there was no admission by the NCAA that it had overstepped.  In fact, it was quite the opposite.

The NCAA took the words "good faith" (from the settlement) out of context to boast that it had authority to punish PSU in Sandusky matter, even though they (and Rod Erickson) knew there was no basis for penalties.

Statements by Erickson, Gene Marsh, Emmert, and other NCAA officials that the Freeh Report provided the basis to punish Penn State were absolute hogwash.  We all now know that the head of the Executive Committee (EC), Ed Ray, never read the report nor did he recall the EC's early favoring of the death penalty.   Statements by the NCAA's PR Exec Bob Williams and Mark Emmert also proved that both men were clueless about the contents of the Freeh Report.  

So, the million dollar question is:  Was Erickson bluffed by Emmert's statements that the Freeh Report showed the worst case of lack of institutional control he had ever seen and that the EC's reaction to it was that they wanted blood? 

Absolutely, unequivocally, no.  

While the email of Julie Roe (Lach) mentioned that "our approach to PSU as a bluff when talking to Mark," it was clear she wasn't among the cabal at the NCAA who was collaborating with Erickson and company.  To make an analogy, she was the NCAA's equivalent of former PSU BOT member Ann Riley in terms of influence. Roe (Lach) would eventually be fired over the Miami (Fla) investigation.    According to Gene Marsh, he had expected to be dealing with Roe (Lach), but stated this was "a whole different critter" when he found himself negotiating with the top brass of the NCAA (Remy and Berst).   

In an interesting aside, Marsh was hired late and had a track record of failures at his two negotiations with the NCAA (on behalf Ohio State and Alabama).  According to Frank Guadagnino's deposition (p. 14), Marsh reached out to PSU at the urging of none other than Cynthia Baldwin.  Previously, Marsh wrote that he believed the NCAA "should leave this one alone."  Later, he would advise PSU to not risk an investigation by the Committee on Infractions.  

Are you smelling something rotten?

Erickson:  Documents confirm he knew
the NCAA didn't hold any cards.

The truth that Penn State and the NCAA so desperately want to stay hidden is that both parties knew there was no Lack of Institutional Control (LOIC) over PSU Athletics.  There were no major violations to support it.  According to documents obtained from Old Main, by January 31st, 2012 the NCAA and PSU understood that the ongoing investigation had found PSU to be very good at following the rules.  

But that didn't stop Erickson and Emmert from striking a "bad faith" agreement.

An Act of Bad Faith

Analysis of the Freeh Report, email evidence, court depositions, and other evidence paints a picture of collusion between top officials at PSU and the NCAA in railroading Paterno and the University at large.  In addition, the evidence shows that Freeh, Sporkin, and Sullivan (FSS) used its engagement letter as the investigation plan and the Office of Attorney General's Sandusky grand jury presentment as the report template for convicting PSU officials in the court of public opinion.  

In summary, it was an "act of bad faith" by all involved.  And they did it for a variety of self-serving reasons.

The PSU Board of Trustees (BOT) needed a replacement narrative to justify the firings of Paterno and Spanier.  It ensured the Freeh Report would do so by specifying the expected contents in the engagement letter with FSS.   There are other reasons for the BOT's inner circle's scapegoating of Curley, Schultz, Paterno, and Spanier, but for the sake of simplicity, the   focus will stay on justifying the firings.

Louis Freeh, who was hired with the encouragement of Governor Tom Corbett, conducted his investigation as not to undermine the Sandusky prosecution and (likely) to assist the OAG in finding more evidence against Spanier.  In doing so, the investigation ignored exculpatory evidence that would have undermined the stories of the janitors and possibly Mike McQueary. 

The investigation and report also whitewashed the failures of The Second Mile and the failures of Pennsylvania's child protection system   The latter fact "benefited" Governor Tom Corbett and the PA government -- who would have been embarrassed if the public learned of the colossal failures of the child protection system (and police) in the Sandusky case.  The failures of The Second Mile also may have exposed the OAG's lax oversight of charities.  In both cases, the state could have suffered financial loss if it had been found negligent and likely forced to establish a victim's fund.

Centre County Children and Youth Services also benefited because it may have faced lawsuits over its shameful performance in the Sandusky case -- had it been exposed by either the OAG or Freeh.  

Freeh didn't work for free.  
The NCAA got what it paid 
for in the Freeh Report.

While the NCAA (and Big Ten) were permitted to engage with the Freeh investigation -- and received substantive updates along the way -- the NCAA's guidance to FSS didn't result in any findings of wrong-doing.   According to the Freeh Report, FSS conducted just one substantive interview concerning NCAA rules after it was briefed by Julie Roe (Lach).  The result was a weak allegation that PSU's compliance staff was understaffed (p. 36). 


The NCAA obviously didn't know the first rule of "Freehdom" -- Louis Freeh doesn't work for free.  You pay your money -- you get your results.  NCAA got what it paid for -- a report that didn't mention a single NCAA violation.  

Conversely, the PSU BOT's payment of $6.5 million ensured that the investigation would go exactly as the SITF directed.  The $6.5 (and eventually $8.1 million) also likely was enough to get Freeh's and his team lie about many things related to the case.

The confirming evidence follows.

Breaking Down the Freeh Investigation

The timeline constructed from the end notes of the Freeh Report correlates quite well with the timeline previously constructed from Right-To-Know emails. Both timelines show that significant updates to the Freeh Report occurred as the PA OAG was forced to utilize (release) evidence already in its possession.  The other significant update to the Freeh Report occurred after the Sandusky trial and the not guilty verdict related to the incident reported by McQueary.

It is highly probable that PSU provided Freeh with the relevant emails and the Schultz file early in his investigation, but Freeh had to wait for the approval of the OAG to utilize them.  Governor Corbett stated Freeh was selected because he would not interfere with the ongoing prosecutions or investigations.  That, of course, would include getting clearance to use certain evidence.

Timeline of the SITF's (Freeh) Investigation

The Right-To-Know emails obtained by PSU alumni Ryan Bagwell and Bill Cluck do not include any mention of a "BOT briefing call" for Freeh to brief the trustees about his investigation plan.  He didn't need to because the engagement letter set forth the outcomes of the investigation, which were to FIND:  1) the reporting failures that occurred; 2) the causes of the failures; 3) who had knowledge of the sexual abuse allegations; and 4) how the allegations were handled by the BOT.  

The timeline of Freeh's investigation reveals he followed the SITF's instructions perfectly, with little diversion of its attention to the NCAA's guidance. 

Engagement 1. Find reporting failures (focused on Paterno and 2001 incident)

November: The 2001 Incident

Freeh began his investigation on November 23rd with an interview of Cynthia Baldwin regarding her discussion with former Senior VP of Business and Finance, Gary Schultz, about his grand jury subpoena.  On the 28th, FSS continued interviewing Baldwin about the 2001 incident.

December: Joe Paterno/PSU Football

 In December, the end notes reveal that the investigation's focus had shifted to Joe Paterno and the football program.  FSS interviewed members of the Athletic Department (AD) and football staff about Sandusky working out in the facilities (Dec 5, 7, 11);  Paterno's knowledge of "everything that was going on" (Dec 6, 19);  Paterno's (lack of) involvement in sports camps (Dec 19); and compliance with NCAA rules (Dec 19).  The Freeh team also met with an official from the Office of Student Affairs to discuss disciplinary matters pertaining to football players (Dec 12).

Engagement 2.  Find causes of the failures (focused on access to facilities)
Engagement 3.  Who had knowledge of abuse allegations (focused on police,1998 incident)

January: Sandusky's Retirement benefits, the Clery Act, and 1998

 After being briefed by the NCAA in early January, the Freeh team met with a PSU AD official on January 10th, but didn't find any evidence of lax protocols or violations.  The FSS team then moved off the subject of NCAA violations and began investigating Sandusky's retirement benefits (Jan 12), conducted interviews with police about the Clery Act (Jan 13) and Sandusky's access to Beaver Stadium (Jan 25).   On January 27th, FSS interviewed a former University Park police officer (likely Detective Ronald Schreffler) regarding the 1998 incident.  

In January, the NCAA was informed that PSU's AD compliance staff was "fastidious about rules violations."  The NCAA responded that it would "wait for Freeh Report."

SIGNIFICANCE: In January 2012, the NCAA and PSU knew the athletic department was compliant with NCAA rules and Freeh's investigation found nothing of note in its investigation from that point forward.

February: Clery Act,Sandusky Retirement, 1998

In February, FSS continued work on the Clery Act, interviewing former police chief Steven Shelow on the 1st.  The next day (Feb 2) they questioned Office of Human Resources (OHR) officials about reporting of incidents and about Sandusky's retirement.  While questioning OHR, the investigators also inquired about the 1998 incident and Curley's background.  The investigation looked into Sandusky's access privileges to the Beaver Stadium luxury suites on February 8th. On February 22nd, a retired dean was questioned about Sandusky's emeritus status, while OHR was likely questioned about background checks.

Engagement 4:  How allegations were handled by the BOT (focus on Spanier's leadership).

March: BOT Knowledge of Sandusky, PSU Culture 

On the last day of February (Feb 29) and through March, the investigation conducted numerous interviews with members of the BOT about how the Board was informed of the Sandusky investigation and about Spanier's leadership.   On March 22, the FSS team received a letter from The Second Mile's attorney explaining its knowledge of the 2001 incident. In the letter, the charity's attorney informed FSS that Curley had told the charity to "avoid publicity issues."  To be clear, the Freeh Report's lone piece of evidence about PSU avoiding bad publicity (p. 78) was based on double hearsay. 

Triponey: Reached out to Emmert
to assist in "Penn State mess."

The investigation took a brief detour to interview Vicky Triponey on March 10th to discuss her interactions with Paterno and Spanier.  According to Triponey's affidavit, she had reached out to Mark Emmert to assist with the "Penn State mess," referencing a "toxic culture."   She also stated that she was told that she would be brought in near the end "to clarify, validate or perhaps confirm what they were hearing in their other interviews."  The significance of Triponey's information was summarized in a footnote on page 65 of the Freeh Report.   The investigation still had nothing on Paterno.


At this point, the report draft was likely a repackaging of the grand jury report with embellishments about Sandusky's access and a few additional areas, like University governance, compliance with the Clery Act and other policies mixed in.  That's when the first bump in the (rail)road occurred.

The Perjury Particulars Bump in the (Rail)Road
In response to a request for perjury particulars by the attorneys for Curley and Schultz, the OAG was forced to utilize the Penn State emails (that had been turned over to the PA State Police in July 2011) to support the Commonwealth's response. The significance of using the emails was two-fold: first, it allowed Freeh to use them in his report; and second, the emails more fully exposed the role of DPW in the 1998 investigation.  

April:  Revisiting 1998 and Continued BOT Interviews.

Up until the release of the emails, Freeh had relied on the University Park police report and an interview (January 27) of a former police officer (likely Schreffler) to recount the incident.  The OAG's release of email evidence essentially forced FSS to revisit the 1998 incident.  The Freeh team performed  interviews with DPW program representative Jerry Lauro (Apr 26) and with a Centre County CYS representative (also Apr 26).  

The BOT threw Spanier  under the bus.

Interviews about the BOT's knowledge of the Sandusky investigation had been ongoing all month (Apr 5 to Apr 23).  The majority of the BOT claimed to have received knowledge of the Sandusky investigation through the May 12, 2011 briefing by Spanier and Baldwin.  A handful of trustees said they had no knowledge of the grand jury investigation until November 2011.  Most trustees recalled that Baldwin informed them it was the third or fourth grand jury to investigate Sandusky and that the incidents  didn't involve PSU. 

In summary, the BOT members dubiously claimed they were in the dark on the Sandusky matter and blamed Spanier for a lack of transparency and for not being inclusive as a leader.

May:  Investigation Wraps Up

According the end notes, only a few interviews were conducted on May 9 and 16 to answer lingering questions about the firing of Paterno.   On May 5, Frazier sent an email to Louis Freeh which confirmed the investigation was wrapping up.  An excerpt from the email follows.

Sent from my iPhone 

On May 5, 2012, at 9:52 AM, "Frazier, Kenneth C." <ken frazier@merck.com> wrote: 

I would recommend waiting a few days to see if Wick calls. If he doesn't, I'd call him 

saying that I suggested that you reach out to him based on my conversation with 

McGinn. I would also let him know ( as I told McGinn) that you guys are wrapping up 

the investigative phase. If they have something to say they should speak up now.

The Schultz File Bump in The (Rail)road
According to the Freeh Report, FSS had twice interviewed Kimberly Belcher (Jan 12 and Apr 12), who denied possessing the Schultz file.  Later that month, in response to a grand jury subpoena, Belcher testified that she turned over a copy of the file to the OAG in April 2012.  She also testified that Schultz provided the originals of the file to the OAG one day earlier. The Freeh Report lists the date of the Schultz file as 5-1-2012, confirming it was obtained after Belcher and Schultz had turned their files over to law enforcement.  

Note: OAG officials concealed the existence of the emails and the Schultz file from the public until the emails were leaked in June.  In May, the OAG changed the date of the McQueary incident from March 1, 2002 to February 9, 2001, however they did not say how the new date was determined.  

The information from the Schultz file very likely caused the Freeh Report to be significantly edited to include details from the notes and emails regarding 1998 and 2001 incidents. However it is also very likely that there was considerable debate on the risk-reward of using the handwritten notes of Schultz.  The notes from 1998 contained damaging information about CYS and DPW being told of many signs of child sexual abuse.  Emails reveal that on May 20th, Frazier, Tomalis, Freeh, and McNeil likely planned to discuss the updates to the Freeh Report and the (selective) use of information from Schultz's file.





The "you dun good" statement by Tomalis was a reference to Frazier lying to the Board about Freeh's investigation being very active and continuing into the fall.  The email between Frazier and Tomalis on May 4th showed that Frazier had lied because he expected the information to be leaked.

At the end of May, the final draft of the Freeh Report was ready, but all involved likely knew that it was light on facts.  It was very likely that the group began its public relations/smear strategy to cover for the deficiencies in the report.

June: Minimal investigation activity -- smearing begins

Little investigative activity took place in June 2012.  The end notes show the investigation circled back with a former finance officer on June 12th (likely Al Horvath) to obtain background information about VP Schultz.  

Evidence indicates that the efforts of the SITF and Freeh focused on making the public believe that honorable men like Joe Paterno and Graham Spanier had more concern for the well-being of a pedophile than the well-being of children.  They did that through leaking emails to the press.

On or about June 11th, existence of the emails was leaked to NBC news.   NBC cited "law enforcement" and "legal sources" (either of which could have been a loose reference to a Freeh team member) in its report.  NBC's report cited just the word  "humane" from the emails -- taking it out of context.  NBC's report was picked up by most papers, including the Philadelphia Inquirer, who reported that Paterno was involved in the email exchange.  The Inky's report appeared to be welcomed by SITF co-chair Ron Tomalis, who forwarded it to the Core Group of Frazier, Freeh, and McNeil.

The original reporting on the emails didn't gain traction initially because the Sandusky trial took center stage.  Interestingly, the trial had one very unexpected - and mostly unreported - result.

Last Bump in the (Rail)Road - Not Guilty, Count 7
Had the Sandusky trial gone according to plan, little changes would have been required to the draft of the Freeh Report.  However, the failure of a jury to believe McQueary's testimony about witnessing a rape likely blew a major hole in the Freeh Report's ability to condemn Paterno's actions in 2001.  The result was that Freeh retreated to using a non-specific passage in an email (of dubious provenance) to "reasonably conclude" that Paterno was solely responsible for stopping the report of the 2001 incident.  Freeh also played up the janitor incident and Sandusky's access to facilities, the latter claimed to be under the purview of Paterno, to condemn the football culture.

The media, who hadn't been paying attention to the details of the Sandusky case from the outset, persisted with the theme that football - and by extension, Paterno - was the reason Sandusky could commit crimes for so long.  A column written by Howard Bryant was embraced by Ken Frazier and likely others at PSU who had been looking to justify the firing of Paterno.



Before the month of June ended, the media returned to the story of the emails -- only with more details being released about their content.  Public opinion was turning against Paterno and Spanier, just as the SITF intended.

July:  Last minute interviews, and finalizing the report

Although Graham Spanier and his legal team had requested meeting with Freeh's team since the outset of the investigation, it didn' take place until July 6th -- about one week before the report was published.   While FSS incorporated some of Spanier's information into the chapters on 1998 (Ch. 2), 2001 (Ch. 4), and the BOT (Ch. 5), it is important to note that the investigators re-interviewed Cynthia Baldwin on July 9th.  The purpose of the interview was to rebut Spanier's statement that he didn't have knowledge of the 1998 incident. 

Freeh Report missed badly on the
testimony of janitor, Buck Petrosky

The other significant interview allegedly took place on July 2nd with janitor Ronald "Buck" Petrosky. Petrosky allegedly told Freeh's team that "football runs this place" and "going up against Paterno would be like "going up against the President of the United States."  However, it is highly probable that Petrosky wasn't interviewed at all.

EVIDENCE:  Pages 65 and 66 of the Freeh Report purport to be Petrosky's testimony at the trial, but there are at least eleven statements included on those pages that were not part of his testimony. In conclusion, it is almost certain that Freeh used the grand jury report to fill in the information and fabricated the quotes.   

Note: The Freeh Report also attributed direct quotes from Mike McQueary (p.67), who was not interviewed, to an interview on March 1, 2012. 

CONCLUSION: No NCAA Violations, No LOIC

The Freeh investigation ended without finding any more evidence of NCAA violations than it had in January.  In short, the NCAA had nothing to hang its hat (or cattle) on. The only NCAA related finding in the Freeh Report was an unsupported assertion that PSU's NCAA compliance staff was understaffed.

Both parties knew (from substantive updates during the investigation) that the Freeh Report would not include information to justify the NCAA penalizing PSU.   Instead, a media campaign would be used to prop up the Freeh Report.

PSU's PR Campaign "Justified" NCAA Sanctions

The inner circle had been working on the public lynching of Paterno, Spanier, and the football program all along.  As noted in a previous post, the outline for the NCAA Consent Decree (CD) was consistent with the key points of Erickson's five point promise.  

The CD was not a cram down...  

..it was the BOT inner circle handing a gun to the NCAA for the execution of the legacy of Paterno and to give PSU football the virtual death penalty (via the athlete transfer option).  The NCAA, who had a reputation as a weak enforcer, had no qualms about playing the heavy.   As part of the deal, the NCAA agreed to mention the death penalty threat and give Peetz and Erickson a pat on the back for cleaning up PSU when gave its press release on the CD.  

Freeh: made many false 
statements during presser

PSU's well crafted media campaign gave "legs" to the Freeh Report.   It started by allowing Freeh to conduct a grand standing press conference where he made statements that were not supported by any evidence (in Freeh Report or anywhere else).  The media and the public learned all they needed to know about scandal by watching "Freeh TV."  

No one in the media fact checked or disputed any of Freeh's statements.

Here is a sampling of false statements made by Freeh at his presser:

20:40- “the evidence clearly shows, in our view, an active agreement to conceal”

22:20 -”the rapes of these boys occurred in the Lasch Building”

26:20 – “the reasonable conclusion that we make is that all four individuals, that I’ve mentioned including Mr. Paterno made a decision – made a decision to actively conceal knowledge in the events of February 2001. I can’t parse between them, degrees of responsibility - what’s significant and shocking is that the four of them, the four most powerful people at Penn State University made a decision to conceal this information.”

30:08 – “Well we know when Mr. Curley speaks to the Second Mile he uses the same word, that they were worried about Sandusky showering with a boy because of bad publicity. So this 
notion of bad publicity, which is really disclosure, opening, and reporting, is a pervasive concern and fear by those running the university.”

30:55 - “There’s several e-mails – contemporaneous e-mails – in 1998, which we found by the 
way, which shows he’s (Paterno) clearly following the case. He’s clearly following the 1998 
investigation.”

33:08 - “The janitors, that’s the tone on the bottom. Ok. These are the employees of Penn 
Stare who clean the locker rooms in the Lasch building where young boys are being raped. They witness, what is probably, in the report, the most horrific rape, that’s described.”

36:20 – “He (Paterno) as someone once said, made perhaps the worst mistake of his life. We’re not singling him out. We’re putting him in a category of four other people who are the four 
major leaders of Penn State….He was an integral part of the active decision to conceal.”

The press ran with those soundbites and they became a substitute for the lack of evidence in the Freeh Report. 

PSU and the NCAA Respond to Freeh Press Conference

PSU's Response

Frazier: Praised Freeh investigation and
emphatically condemned PSU officials

According to the deposition of Frank Guadagnino (pages 18 and 19), a small group including Ken Frazier, Karen Peetz, Rod Erickson, Guadagnino, Tom Poole, and Richard Edelman met to review the Freeh Report and craft PSU's response.  The cabal who would go on to inflict more damage on PSU than Sandusky, gave the University the death blow.

Ken Frazier praised the Freeh Report for "following the facts" and for being "thorough and comprehensive." Frazier also emphatically condemned  Paterno, Spanier, Curley, and Schultz for their alleged failures.  Peetz piled on, stating Paterno's 61 years of service were "marred."  Erickson's pledge to implement all of the recommendations in the Freeh Report (just as he said he would in his November 2011 five point promise), left little doubt that PSU had totally accepted the Freeh Report.

 In the public's eyes, PSU's press conference confirmed the Freeh Report.  Dissenting views  were given no credence by the PSU administration or the media.

Two days after the press conference, Frazier emailed Peetz to suggest disbanding the SITF. It's mission was accomplished -- it had justified the firings of Paterno and Spanier by propping up the Freeh Report.

NCAA Response

The NCAA's response to the Freeh report was originally very cautious, stating that it would carefully review it and were awaiting PSU's response to the four questions in its November 17 letter to Erickson. 

"Like everyone else, we are reviewing the final report for the first time today. As President Emmert wrote in his November 17th letter to Penn State President Rodney Erickson and reiterated this week, the university has four key questions, concerning compliance with institutional control and ethics policies, to which it now needs to respond. Penn State's response to the letter will inform our next steps, including whether or not to take further action. We expect Penn State's continued cooperation in our examination of these issues."

PSU Substitutes Freeh Report & Pleads Guilty to LOIC

In November 2011, then PSU General Counsel Cynthia Baldwin was drafting a response to the aforementioned letter, but was told to stand down by the SITF.  Erickson and Baldwin were told that the response should wait for the outcome of its (Freeh's) investigation.

The deposition of Rod Erickson revealed that after the release of the Freeh Report, it expected to respond to the NCAA's four questions by early August 2012.   On July 17, 2012, Erickson made a statement that PSU was crafting a response to the four questions and then would "negotiate what would be appropriate sanctions."   

Erickson was lying about those two things (and likely many others).

An email dated July 18th from Gene Marsh indicated that penalties were already proposed by the NCAA as early as July 16th or 17th.   According to NCAA Counsel Don Remy, Erickson told the NCAA that PSU had accepted the Freeh Report and that the report contained evidence of a LOIC.  

Erickson's deposition confirmed Remy's position that it was the former PSU President who determined the Freeh Report constituted a LOIC.  Under questioning, Erickson stated he was familiar with the concept of a LOIC from reading sports pages and that PSU was in violation.  He then spun the story to state that it was the NCAA (Emmert) concluding it was the worst case of a lack of institutional control and that the University presidents "wanted blood."   

Contrary to the statements of PSU and Erickson, they were not bluffed and the NCAA wasn't holding any cards.   


Ed Ray's deposition and emails indicated that the talk about the NCAA EC favoring the death penalty was not true.  As Ray said, "if you told me the vote was 19-2 against, I wouldn't have been surprised."  

The truth as that the PSU BOT Executive Committee pushed the NCAA to play up the death penalty scenario and also asked the NCAA to give them props for improving governance and removing the former leadership.


The excerpt below is from an email exchange between Don Remy and Ed Ray, in which Remy explained how PSU asked the NCAA to play up the death penalty and its improvements in governance.   

The CD came down hard on Paterno, Spanier, and the Athletic Program and caused irreparable harm to the University's reputation.  By design of PSU, the CD penalties didn't inflict direct financial damage to PSU.  Collateral damage would be another story.

PSU Athletics Pays The Price

Evidence uncovered during my investigation revealed that Erickson was quite well versed in the financial affairs of both the University and the Milton Hershey Medical Center.   While he was a puppet of the inner circle, he was no dummy when it came to finances and the penalties bear that out.

PSU Athletics will bear the financial burden
 of the scandal for the next 35 years. 

Under PSU's plan, the $60 million in fines (and the subsequent payment of claims related to the Sandusky incident) wouldn't cost the University anything.  The fines, originally expected to come from football reserves,  would instead be paid by the Athletic Department through an interest bearing loan.  It is estimated that the University will earn around $44 million in interest over the life of the loan -- while the football program is saddled with the debt for 35 years.   That of course, is on top of vacation of wins, scholarship reductions, bowl bans, probation, a phony Athletic Integrity Agreement, and confiscation of bowl money by the thugs in suits who run the Big Ten.  

The litigation expenses for University officials (Curley, Schultz, Spanier, and Baldwin) are covered through directors and officers (D&O) liability insurance.  Additionally, the Erickson mistakenly assumed that the payoffs to the Sandusky claimants would be covered by its insurance policies.  The insurer pushed back, stating PSU's policies didn't cover abuse and molestation incidents. PSU sued and ironically, count 4 is "BAD FAITH."  Talk about irony. Litigation in that case is expected to begin in March 2015.

In late 2012 through 2013, Erickson and the inner circle must have believed it got a pretty good deal for the money it paid Freeh.  

It had blamed Paterno, Spanier, PSU Athletics, and the "football culture" for Sandusky's crimes, got the NCAA to gratuitously pile on, absolved themselves of any real responsibility or accountability, kept control of the University, feigned concern for child abuse victims, and won the support of the media and the public.  

 All for about $8 million. 

Call it a railroading.

Call it a framing.

Call it what it was...an act of bad faith by the BOT inner circle and the NCAA.