Federal Way will pay $50,000 settlement in civil suit over prescription fraud investigation

The City of Federal Way will pay a $50,000 settlement to two individuals who sued the city, claiming illegal seizure and arrest, among other things.

On May 18, the city council voted unanimously, with members Jack Dovey and Jeanne Burbidge absent from the meeting, to approve the settlement — awarding $25,000 each to Nancee Rabago, 45, of Federal Way, and Michael McCord, 40, of Buckley. The case pertains to a prescription fraud investigation that did not result in criminal charges against Rabago or McCord. It also did not result in the arrests of the subjects, said police spokesman Raymond Bunk. A police report was written for informational purposes only, he said.

The complaint filed by Rabago and McCord sought $750,000. The two were detained during a prescription fraud investigation, according to city records, which do not provide details of the detention. Their civil suit sought damages for illegal seizure and arrest, unnecessary force on behalf of the Federal Way police, unlawful search, false arrest/imprisonment and assault and battery.

"The settlement is clear that this is a business decision," city attorney Pat Richardson said prior to the vote. "The city is not admitting any liability, but with the uncertainty of litigation, the insurance company, as well as staff, is recommending council approve this."

According to Bunk and public records sought by The Mirror, there is no documentation that indicates Rabago or McCord were actually arrested or treated harshly.

"According to the police report and the police officers, there were no physical arrests made; there was no transport of the subjects; there was no forced used on either subject, nor was there a need for force to be used, and the report that was written by our officers was done by informational purposes only," Bunk said.

Known circumstances

Here's what is known. On Sept. 11, 2008, the suspects attempted to fill a prescription for 5 milligrams (60 pills) of oxycodone at the Federal Way Target store, according to police records. Employees called police when they believed the prescribing doctor's signature had been traced onto the prescription note and that they were dealing with fraudulent activity.

Rabago told the pharmacist she suffers from a possibly terminal disease and was prescribed oxycodone by a Seattle clinic, according to police records. A pharmacist phoned the doctor to confirm this. The doctor told the pharmacist that Rabago had sought more medication and he had authorized his nurse to give her a prescription, but he did not know the dosage of the prescription, according to police records.

Target chose not to fill the oxycodone prescription for several reasons. It was declined in their electronic system, after the suspect made repeated attempts to obtain the pain medication at another pharmacy, according to police records. Some of the prescriptions submitted at that pharmacy did not have a standard DEA number, which is assigned to all highly addictive narcotics and used by the Drug Enforcement Agency to track the amount and frequency the narcotic is dispensed.

Subjects sue

In May 2009, Rabago and McCord filed their civil suit against the city. Last month, the plaintiffs met with outside legal counsel representing the City of Federal Way and settled on a payment of $50,000 plus costs for mediation. The case was set for an October trial date.

But the question remains: Why did the city agree to settle with Rabago and McCord? The city is ordered by the court system to participate in mediation in an attempt to settle the disagreement before going before a judge, Richardson said. The city is also expected to participate in good faith and agree upon an offer if it is considered reasonable, she said.

Had the city taken the case before a judge, it risked, at the least, having to pay attorney fees that could have exceeded the $50,000 ($25,000 apiece) awarded to Rabago and McCord, Richardson said.

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