UC Davis chancellor withholds $200,000 scholarship donation as inquiry continues

Controversy not an unfamiliar companion for UC Davis Chancellor Linda Katehi

UC Davis Chancellor Linda Katehi has undergone significant scrutiny and criticism during her tenure at the university, stemming from incidents such as the pepper-spraying of peacefully protesting students to her service on corporate boards.
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UC Davis Chancellor Linda Katehi has undergone significant scrutiny and criticism during her tenure at the university, stemming from incidents such as the pepper-spraying of peacefully protesting students to her service on corporate boards.

UC Davis Chancellor Linda P.B. Katehi has withheld $200,000 in textbook publisher stock that she pledged to a scholarship fund in March when she faced criticism for having served on the company’s board.

Katehi, 62, may rescind the pledge altogether, depending on the outcome of a University of California investigation into her actions as chancellor, according to her private spokesman, Larry Kamer.

“Given the state of events, Chancellor Katehi and her family will consider their options regarding charitable donations at the conclusion of the investigation,” Kamer said.

Katehi made the promise March 4 after she apologized for accepting questionable corporate board positions with DeVry Education Group, a for-profit company under federal scrutiny for allegedly exaggerating job placement and income statistics, and John Wiley & Sons, a publisher of textbooks, college materials and scholarly journals.

The chancellor was placed on paid administrative leave by University of California President Janet Napolitano on April 27 pending an investigation into allegations that she misused student funds, lied about contracts she approved to boost the university’s image and gave relatives she employed preferential treatment. While Napolitano has questioned Katehi on those fronts, the UC president has defended Katehi’s service on the Wiley board.

Katehi received $420,000 in income and stock across the 2012-2014 fiscal years as a board member for John Wiley & Sons. Her tenure came as students and state leaders sought to reduce the cost of textbooks and encouraged public colleges to use free, digital alternatives.

Students and nonprofit critics said that Katehi’s service on the Wiley board was a conflict of interest for a public university president, but Katehi said in a March letter to students that she wanted “to help Wiley improve the quality of its educational materials, while making them more accessible and affordable for students.”

In that same letter, she wrote, “To further our work together on behalf of California students, here is my commitment to our UC Davis community: I will establish a $200,000 scholarship fund for California undergraduate students at UC Davis from my Wiley stock proceeds.”

Katehi sent her letter as students protested outside her office in a demonstration that lasted five weeks.

“She just consistently uses students as some sort of bargaining chip in her career,” Annie Ashmore, a 21-year-old UC Davis student who occupied the lobby of Katehi’s office, said Friday. “That shows so much about her character and leadership style. Honestly, she is a pretty greedy individual.”

Kamer said that Katehi and her husband, Spyros Tseregounis, previously created five scholarships to benefit students attending UCLA, UC Davis and the University of Illinois.

Katehi spent much of Wednesday being interviewed by investigators at the Sacramento offices of Orrick Herrington & Sutcliffe LLP, the law firm hired by the UC Office of the President to investigate the chancellor. She concluded the interviews after a few hours Friday, Kamer said.

The two sessions marked the first interviews with investigators she has participated in since her suspension. The lead investigator is Melinda Haag, a former U.S. attorney from San Francisco. Katehi’s spokesman has said the allegations against her are false.

“The chancellor presented her case very strongly,” Kamer said, adding that the two sides agreed to resolve the impasse over Katehi turning over her cellphone, iPad and other university-owned electronic devices for inspection.

Katehi attorney Melinda Guzman had objected to turning over the data on the devices without an independent third-party being selected to determine what private information on the electronics should be withheld.

Kamer said UC officials agreed Friday to Guzman’s original suggestion that information considered privileged – medical records or personal messages, for instance – be held by an independent third party.

“Chancellor Katehi’s attorney has gone through thousands and thousands of these records determining which are privileged, and those are held aside,” Kamer said. “The vast majority of the records on these devices either have been or are about to be turned over.”

Napolitano’s office has said it wants the investigation completed by Aug. 1, although the issue may arise at the next UC Board of Regents meeting, which is scheduled to take place in San Francisco July 19-21.

Katehi earns $424,360 a year as chancellor of UC Davis, where she has served since 2009.

Diana Lambert: 916-321-1090, @dianalambert

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