Pacific no more? Mounting legal claims could bankrupt city

PACIFIC, Wash. -- The city and its embattled mayor have been sued by seven former employees and the former mayor, and the city attorney says the claims could bankrupt the city.

In a memo to city employees on Wednesday, Pacific Mayor Cy Sun said, "Everything is OK," that the city will be survive and their jobs will remain safe.

But the eight newly-filed claims could cost the small city several million dollars -- possibly more than it can afford, according to the city attorney.

What's happening in Pacific could be a lyric to a country song. The city council is fighting with the mayor, who is fighting with the police.

When the mayor was arrested trying to cross a police line inside City Hall, he fired the arresting officers on the spot. Now those four officers are each firing back with $1 million civil claim, citing wrongful termination.

On top of those claims totaling $4 million, Pacific Police Chief John Calkins and two other heads of department have each filed a $1.5 million wrongful termination claim.

And the former Pacific Mayor Rich Hildreth has filed a $500,000 claim for defamation of character over Sun's claim that Hildreth is corrupt.

But that's not all.

In addition to the $9 million in claims filed by eight individuals, fired city clerk Jane Montgomery has filed a $2.2 million claim, bringing the total to $11.2 million.

The city attorney says Pacific is only insured up to $10 million, which means the claims could bankrupt the city.

The impending claims and possible loss of insurance have the city council preparing a plan in case the city folds and has to dis-incorporate.

Despite the claims, Sun remained optimistic in his memo to employees.

"I am very confident that the outcome will be just as we are," he wrote. "So, you're in good hands!"

Meantime, the recall effort against the mayor is moving forward. Sun has 15 days appeal. If not, supporters of the recall have four days to collect signatures and get the issue on a special ballot, most likely in December.