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Cherokee County former DSS director pleads guilty, insurer sues county

Lilly Knoepp
Carolina Public Press has been following a trial against the Cherokee County Department of Social Services for the use of policy which transferred custody of children.

Cherokee County’s former Department of Social Services director pleaded guilty to felony obstruction of justice at the end of October. The charge focuses on Cindy Palmer’s use of an illegal custody agreement which could have unlawfully removed as many as 50 children from their homes in the county. Carolina Public Press’ lead investigative reporter Kate Martin has been covering the trails of those families for two years and spoke with BPR’s Lilly Knoepp about ongoing litigation.

Lilly Knoepp: This case has revolved around a DSS policy using a custody and visitation agreement to remove children from their parents without court oversight is how you explain it. Can you please explain the policy a little bit for our listeners before we get into the recent updates in the current federal civil case?

Kate Martin: Absolutely. So what I'm about to say is outlined in some court documents and also was in testimony during a May civil trial. Basically, what would happen is social services when they had a really difficult case they would try to use this document to go to the parent and say, ‘Hey, sign this document and give your custody of your child to usually a relative or a friend. If you don't do that within a certain short time period, like 24 hours, then we're going to start the process to get the kid moved to foster care where you might not ever see them again.'

Lilly Knoepp: And how many children were kind of removed from their home using this policy in Cherokee county?

Kate Martin: I believe at least 30, the attorneys who are representing the civil plaintiffs. They think that it could be higher than that. Possibly as many as 50.

Lilly Knoepp: We actually had a new update in this case (on October 26th) - the case has been going on since 2015 - where the former DSS director Cindy Palmer pleaded guilty. It was kind of wrapping up her portion of the case. Tell us a little bit about her sentencing and how that a guilty plea went.

Kate Martin: Well, Cindy didn't say a whole lot in court. She answered questions from the judge, you know, affirming that she knows what she's pleading guilty to that. You know, that she's of sound mind and not under the influence. Just the really typical questions that one would answer from a judge, making sure they were happy with their defense attorney. She pleaded guilty to felony obstruction of justice, that she had two counts of those against her one for each of the two years that she was in charge of that office. As a result of that guilty plea, they're dropping the other charges against her. There were three misdemeanor charges. There was also a perjury that they had against her because she lied during a court proceeding in 2018 by saying that she didn't know about the custody and visitation agreements until after they had been uncovered by an attorney. Staff members of the office had said during a trial in May, that she certainly did know about them. And I know of other folks who said that she knew about them as well. So in any case, what this meant as part of this plea agreement is that she's not going to spend any time in jail. She's going to be on unsupervised probation and she's ordered by the judge to not work at Cherokee County DSS again. She had already resigned her position the previous month. And the county had said that she was ineligible to be rehired in any case.

Lilly Knoepp: After this long case, now it's wrapped up. She also got 24 hours of community service. There were also other people have also been charged in this. That's one of the things that Cindy Palmer has said is that this policy was used prior to starting her role. And the former DSS supervisor, David Hughes pleaded guilty to two misdemeanors in 2021 as part of this agreement. And then former county attorney Scott Lindsey is also on trial for this. So how far back does the use of the CVS go?

Kate Martin: Well, as far back as I've seen in some of the court filings is 2009, possibly 2007. I need to check my timeline on that. However, the attorneys for the plaintiffs who are suing the county, Cindy Palmer and Scott Lindsey, and some other directors. They say they believe that it could be as far back as before 1999.

Lilly Knoepp: So to put a face to the people who have been involved with this policy. One of the recent court cases that was won, was of Brian Hogan. His daughter was taken away using this policy and they won a judgment of $4.6 million against Cherokee County. You covered that case in court. Can you tell us a little bit about that case?

Kate Martin: So Brian's wife in 2016 had a heart attack and Brian went to Asheville to be with her. In that time, he left his children with a neighbor. They all lived in a trailer park and left her there with the neighbor. The neighbor's child was also her best friend. You know, she was really excited to be there.E Except that at school, teachers had complained about an odor from her. And so DSS went to investigate and then Brian had signed temporary custody to his father because he didn't have anybody else to give her to. This was a legal placement.  I believe they went to him a couple of times to do this because he was very occupied with his wife. And then when he got back to town, he had been evicted while he was in Asheville and was trying to set up an apartment.

Then one day DSS calls him and tells him that he has 24 hours to sign another agreement. And so he calls us father and they go to the DSS office together and they signed this document. He said that nobody had explained the document to him. Nobody told him that the document said that his daughter would be in her grandfather's custody until she turned 18. And the reason he doesn't know what the document said is because he can't read. He's illiterate. He had done everything that DSS had told him to do in terms of getting a job. Brian testified how he's always worked, you know, every day in his life when he's can. DSS told him to get a job one day and he had a job the next day. So it's not from lack of effort on his part, according to his testimony. But they didn't read the document to him and he just didn't understand it. And so he spent a whole year away from his daughter and then one day he runs into his attorney at the courthouse and basically begged her to look at this and help him get his daughter back. And that's where it all blew up.

Lilly Knoepp: And then another case was also settled for half a million dollars and there are still other cases pending against Cherokee County. That is a lot of money to have settled from Cherokee County. How is that working as far as paying off these settlements and, and dealing with this from an insurance and tax perspective?

Kate Martin: Well, first let's try and talk about and put a number on the remainder of these cases. So, just for context, Cherokee County's annual revenues for property taxes is $17.2 million. And a county commissioner had said during a meeting that their lawyer had said in a closed session that it could cost $50 million [for all the settlements]. And so, $50 million, if they go to court on everything, is like three years of all of the property tax money that Cherokee County gets. These cases, there's at least a couple of dozen of them in the court file. The next one is going to be going to trial in January. And the problem from the Cherokee County's point of view with Cindy Palmer's guilty plea is there's a clause in their contract with their insurer.

That says, basically, if anyone is convicted of a felony in the conduct of doing their job, then basically means we're not going to cover you for these incidents. And so now Cherokee County doesn't have any insurance coverage for this. And I'm betting, this is all going to be argued in court like this isn't just the end all be all of it. So, without this insurance coverage, the Cherokee County taxpayers are going to have to pay for it. And, you know, I don't think it's going to be $50 million dollars. It's probably going to get settled if I were to guess. But that's still a very large amount of money that a poor rural county is going to have to shoulder. There's going to be a lot of tough decisions for Cherokee county's elected officials in the next few years.

Lilly Knoepp: And I believe this is also not the only time Cherokee County has had to settle in court. And actually those are also linked to Cindy Palmer through her husband, Derrick Palmer, who is the Sheriff. And you've been covering that as well. Can you just briefly speak to some of that?

Kate Martin: Yes. A number of years ago, an inmate named Joshua Shane Long had been arrested. He came to the jail and basically sat in a cell for several hours until he died. Right before his arrest, a deputy said that it looked like he tilted something up into his mouth from like an Altoid tin or a little metal tin and ingested something, but they never checked on what that was. They never sent him to medical. After he collapsed, it took some time for basically a medivac to get there. They were going to fly him to Tennessee, but for some reason it took 45 minutes for that helicopter to leave. And so there's a lot of unknowns there about what happened and exactly why. And the county settled that case. I'm not exactly sure what the dollar amount is yet because it involves a minor and the court usually appoints somebody to make sure that the settlement is fair for that minor.

Lilly Knoepp: So a lot of pending litigation that you're continuing to follow. What should we look out for in the coming days?

Kate Martin:  I'm really interested to see how the county reacts to this guilty plea because their insurer is suing them in Wake County. Since she's [Cindy Palmer] pled guilty, there should be some interesting movement there. The big thing we should look for is this next trial in Asheville and the federal court with a woman named Molly Cordell, who was removed from her father after her mother died. This is the sister of the woman who received the $450,000 settlement and was in a significantly worse position than Heaven had been. This woman was essentially forced to get a job, to pay for her room and board. Where if she had been put in an illegal placement, the county would be paying for her room and board. So there's a lot of problems with the county taking a child away and in an illegal way, you're supposed to get services.
They're supposed to check out where you're living and do background checks on the people living there.

If you don't mind me also adding an anecdote from Palmer's guilty plea yesterday (on October 26th), the special prosecutor Bob Zellinger from the Attorney General's office, who prosecuted Palmer, said that there were instances where a woman was forced to basically give temporary custody of her son to her father-in-law who had drug charges of his own. And Zeilinger said, “the children in the house were being sexually abused by the older children. DSS still did this and used a CVA and sent the child to this house. The mother later learned that her son had been molested there.”