Jackson Jambalaya

The American Federation of Teachers-Mississippi accused the American Federation of Teachers of covering up the embezzlement of AFT-MS funds by the Jackson Federation of Teachers and JFT President Dr. Akemi Stout in a federal lawsuit.  

The American Federation of Teachers-Mississippi (AFT-MS) discovered the Jackson Federation of Teachers (JFT) was "having cash-flow problems" in 2018 and 2019.  JFT collects dues from members and is supposed to forward a portion of the dues to the state and national organizations.  However, the state chapter said JFT did not make the required payments for a year. The lawsuit also claims Dr. Stout tried to move JFT's headquarters to her home. 

A suspicious state chapter tried to investigate and get access to the JFT books but Dr. Stout refused to cooperate. JFP refused to provide any financial statements as well.  Blocked at every turn,  AFT-MS notified the national organization (AFT).  AFT promised to investigate.  While AFT promised, JFT stonewalled as it said since the national organization was investigating, it saw no need to cooperate with the state chapter. 

AFT allegedly told AFT-MS to "stand down until" it completed its investigation.  A year passed before AFT concluded the investigation in January 2020.  The complaint charges AFT only completed the report because AFT-MS hired a lawyer who issued demand letters to AFT for the investigation's findings.  AFT finally sent the final report to AFT-MS in February 2020.  

The AFT investigation found: 

* Dr. Stout unilaterally gave herself a $7,498 increase to her 401k plan. 

* There were $2,352 in unexplained ATM cash withdrawals. 

* $3,659 in improper Paypal transactions

* $1,793 spent using the Cash app

* $2,252 spent on hotels, restaurants, and bars

* JFT paid Dr. Stout $60,516 in salary for 2018 but her salary was supposed to be $48,379. 

* Receipts and similar documents were often missing. 

* Dr. Stout spent $26,086 on computer repair expenses at Rod's Repair & Maintenance Services from 2017 to 2019 even though JFT budgeted only $10,220 for such costs. The company does not appear in a Google search nor on the Secretary of State's website. 

* JFT did not pay required per capita dues of $114,754 to AFT-MS.

A frustrated AFT-MS accused AFT of showing "absolutely no interest in working with AFT-MS to resolve this still on-going financial issue."   

The state chapter asked AFT to remove Dr. Stout and place the Jackson chapter directly under state control (That's a familiar theme in Jackson, isn't it?) so it could clean up the books and whip the Jackson chapter back into financial shape. Unfortunately, the lawsuit claims AFT-MS ran into some good ole-fashioned good ole gals that had no interest in fixing anything.  

AFT-MS claim AFT Secretary-Treasurer Loretta Johnson and Dr. Stout are close friends.  Johnson denied the request, stating the "financial crimes" did not rise to the level of an immediate threat. 

The lawsuit alleges that JFT and AFT entered into a secret agreement as AFT stonewalled AFT-MS.  The secret agreement allows JFT to repay the owed $114,754 in per capita dues directly to the national organization, bypassing the state chapter.  JFT will pay $1,195 per month for 8 years with no penalty or interest.  The lawsuit claims the payments include AFT-MS's share of the dues.  Stout is allowed to remain JFP President.

If true, it means the American Federation of Teachers is helping itself to the Mississippi chapter's portion of the dues.  Of course, AFT could remit the AFT-MS share to the chapter but the plaintiffs claim JFT has not made a single payment even though it is one year later.    

AFT-MS President Geraldine Bender objected to President Randi Weingarten in an August 11, 2020 letter but to no avail: 

Over the past few years, one of our locals, the Jackson Federation of Teachers (hereinafter, "JFT'') fell behind on their financial obligations to the AFT-MS.  Members complained that they believed the officers of the JFT were misusing funds and raised concerns which were ignored by the JFT.  The then treasurer (before being fired) told President Stout that the credit card was not for her personal  use, during a board meeting, in which I was in attendance. The AFT-MS attempted to investigate but Akemi Stout of the JFT ignored all attempts.  All pleas to the national  AFT were deemed unfounded  by Tanya Cornell  AFT Southern Regional Director, and Lorretta Johnson, Secretary/Treasurer.  Attempted calls to your office were referred to and answered  by either of the two, who believed that it was a personal conflict between AFT-MS and JFT.

Fortunately, an audit of the  JFT was performed by the AFT (while it prevented our office from  reviewing the JFT's books as provided by our by-laws)  , which confirmed the members' suspicions.  Tbe audit found that JFT, through its  president Akemi Stout, had been embezzling money which had been paid to the JFT by its members.  This audit also found that Stout had unilaterally increased her salary, made thousands  of dollars in unauthorized payments to related individuals, spent lavish amounts of money at hotels, and withdrew hundreds of dollars in cash from the JFT account.  After these facts were uncovered, Regional Director Cornell and Secretary/Treasurer Johnson have insisted this is personal and denied all requests to recover the $114,754 in a reasonable manner.

Ms. Bender also argued the agreement bound AFT-MS without its consent. 

A frustrated Geraldine Bender and the American Federation of Teachers-Mississippi sued the American Federation of Teachers, AFT President Randi Weingarten, Secretary/Treasurer Loretta Johnson, Jackson Federation of Teachers, and JFT President Dr. Akemi Stout in U.S. District Court on April 9 for various counts of embezzlement, unjust enrichment, and breach of fiduciary duty.  The lawsuit charges the following counts: 

Count I: Declaratory judgment on the validity of the agreement.  Neither AFT nor JFT can enter into an agreement on AFT-MS's behalf.  The "secret agreement" should be declared null and void. 

Count II:  Breach of fiduciary duty. The charter requires JFT to pay per capita dues to AFT-MS and AFT.  Dr. Stout had a fiduciary duty to JFT members. 

Count III: Breach of fiduciary duty against Weingarten and Johnson.  They allegedly breached their duty to the AFT-MS membership. 

Count IV: Breach of fiduciary duty by tortious interference of business by AFT.  AFT allegedly interfered with the affairs of AFT-MS and JFT's obligations to the state chapter. 

Count V: Unjust enrichment/Constructive trust. The embezzled dues are owed to AFT-MS, not AFT.  The American Federation of Teachers is helping itself to the states chapter's dues due from Jackson. 

Count VI: Embezzlement by JFT President Dr. Stout. 

Count VII: Breach of fiduciary duty.  The defendants failed to appoint an administrator. 

The lawsuit asks the Court to void the agreement, require JFT to pay the $114,754 in per capita dues with interest to AFT-MS, and award punitive damages for intentional financial misconduct as well as legal fees. 

The case is assigned to U.S. District Judge Daniel Jordan, III.  Biloxi attorney Stephen Dummer represents the plaintiffs.   The defendants have not yet responded to the lawsuit.  They were not served until the end of June.