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Texas 13th Court of Appeals (Corpus Christi-Edinburg)
Charter Didn’t Breach Ex-CFO’s Contract
Ruling: A breach of contract lawsuit that a former chief financial officer (CFO) filed against the charter is dismissed because his employment contract was approved by the charter’s chief executive officer (CEO) and not by the charter’s board. IDEA Public Schools v. Wyatt Truscheit, No. 13-22-00091-CV. Issued Sept. 1, 2022.

A three-member Thirteenth Court panel concluded that Truscheit can’t pursue a breach of contract claim against IDEA Public Schools because his initial and subsequent employment contracts were executed and signed by the charter’s then CEO — IDEA co-founder Thomas Torkelson — instead of being submitted to the board for final approval.

The justices cited state law, prior court decisions and a TEA rule in concluding a charter’s board is the only entity authorized to approve contracts, including employment contracts, unless (as was not the case here) the commissioner had approved a revision to the charter’s charter to allow another party (typically the CEO or superintendent) to have final contract approval authority.

The record reflects that the board had only given Torkelson the authority to “select and terminate” employees, and that the board had not asked the commissioner to amend the charter to give its CEO final contract approval authority.

The justices rejected Truscheit’s claim that the board had effectively approved his contract by virtue of approving a lump sum item labeled “School Leadership” in the budgets Torkelson routinely presented to the board.

The record reflects that the initial employment contract, and subsequent contracts, that Torkelson and Truscheit jointly signed specified that IDEA was to pay Truscheit a lump sum for the remainder of his contract if he were to be fired.

Commuted from California to Texas
The contract also required IDEA to pay for Truscheit to make a biweekly commute to and from his home base of California to the Rio Grande Valley of Texas where IDEA is headquartered, and for the charter to pay his “reasonable living expenses” while working for the charter in Texas.

Torkelson resigned as IDEA’s CEO in April 2020 amid public questioning of decisions by charter leaders, such as a planned purchase of a private jet and the purchase of $400,000 worth of San Antonio Spurs premium basketball tickets. Torkelson reportedly received $900,000 in severance.

Truscheit left IDEA’s payroll about three months later — in July 2020 while under a contract expiring in December 2022 — due to what Truscheit said was a termination (and IDEA said was a resignation due to retirement).

IDEA said in a legal brief that if Truscheit were to succeed in his lawsuit, the charter would have to pay him from $200,000 to $1 million — public money that the charter holds in trust for the benefit of all its students.