JUDGE WILL DISMISS SUIT THAT SHED LIGHT ON MARIJUANA THEFTS

Lawyers for the Chatham County sheriff and a former deputy who sued him for
wrongful termination have been notified by a Superior Court judge that the
case will be dismissed.

Judge John R. Jolly faxed a letter to attorneys for Sheriff Ike Gray and
former Sgt. Dan Phillips saying he will grant the defendants' motion for
summary judgment because the sheriff's actions are not covered under the
county's insurance policy, said Al McSurely, Phillips' lawyer. Jolly, who
heard the motion July 8, is expected to submit his order to the court this
week.

"We will appeal this immediately," McSurely said, "and [we] believe that
the Court of Appeals will find the facts as repulsive as the lower court
did and will remand the case for a jury trial sometime next spring."

Phillips sued Gray in February 2001, saying the sheriff fired him for
trying to uncover racism in the Chatham County schools by making a tape
recording of a high school principal using racial slurs.

One year later, a judge amended the lawsuit to add Chief Deputy Randy Keck
as a defendant and allege that Phillips also was fired for alerting the FBI
about 1,000 pounds of marijuana evidence that had been stolen in September
2000 from a shallow pit at the old county landfill. In November 2000,
Phillips drove an informant to the FBI office in Asheboro, sparking a
federal investigation into the theft. Gray fired Phillips two months later.

Affidavits in Phillips' case shed light on Chatham County's highly
publicized marijuana thefts -- about 4,000 pounds from a surplus Army truck
parked behind the department, and the remaining 1,000 pounds from the
landfill. The drugs had been seized in February 2000 during an undercover
sting at a barn southwest of Siler City.

Three men have pleaded guilty to stealing some of the marijuana buried at
the landfill. They will be sentenced Aug. 12 in U.S. District Court in
Greensboro.

In his affidavit, Gray says he fired Phillips because the deputy was
insubordinate, refusing to take a polygraph test to determine whether he
had made a tape of William "Buddy" Fowler, the former Chatham Central High
School principal, making racial slurs.

During a hearing two weeks ago, Gray's attorney, Mark Davis, argued that
the sheriff fired Phillips spontaneously for threatening Keck and the
department with a lawsuit. Phillips, he said, had a heated conversation
with Keck.

Gray could not be reached for comment Monday. Davis said he was pleased
with Jolly's decision, which he called "a proper application of North
Carolina law."

"It would be premature to comment more fully on his ruling," Davis said,
"until a written order has been entered."

In North Carolina, sheriffs are immune to wrongful-discharge lawsuits
unless they're insured. Chatham County has an insurance policy, but it has
exceptions for willful, intentional or malicious conduct, and claims
brought by a covered person against another covered person. Jolly told the
attorneys that both exceptions eliminate liability coverage for Gray and
Keck, making them immune to the lawsuit, McSurely said.

Jolly also plans to dismiss both of Phillips' wrongful-discharge claims --
that he was fired for standing up for the rights of African-Americans, and
for refusing to cover up possible criminal activity involving the stolen
marijuana.

"In the meantime," McSurely said, "to protect our client's rights, we are
strongly considering a second lawsuit in federal court alleging that
[former] Sheriff [Don] Whitt, Sheriff Gray and Chief Deputy Keck conspired
to deprive Dan Phillips of his federal constitutional rights."