Fired attorney sues Idaho AG, says she was retaliated against when she raised concerns about ethics and law-breaking

BOISE (Idaho Statesman) — A lawyer working for Idaho Attorney General Raúl Labrador said she raised concerns that the attorney general’s office was violating legal and ethical rules. Less than three hours later, she was fired.

Former Deputy Attorney General Daphne Huang on Friday filed a wrongful termination lawsuit, alleging she was fired in retaliation for raising concerns that executives in the attorney general’s office were breaking laws and ethical rules.

“Defendants terminated Ms. Huang within three hours of receiving written documentation related to her concerns about possible violations of law, rule or regulation,” attorneys representing Huang wrote in the lawsuit. “There is a causal connection between Ms. Huang’s protected activity and her termination.”

In her lawsuit, Huang alleged that she was fired after she raised concerns that attorneys were being forced to take positions hostile to their clients at the Idaho Department of Health and Welfare. Executives in the office created “an untenable conflict of interest” and “ethical conflicts that she refused to participate in,” attorneys for Huang wrote in the lawsuit.

Beth Cahill, Labrador’s spokesperson, declined to comment on the litigation. She said officials in the office haven’t received Huang’s legal complaint.

Firing amid exodus of Health and Welfare attorneys

The Idaho Statesman previously reported that Huang, a deputy attorney general for more than a decade, was fired in March amid an exodus of attorneys representing the Idaho Department of Health and Welfare.

Earlier that month, the attorney general’s office launched an investigation into the health department’s administration of Community Partner Grants, federal funds that address learning loss among children during the COVID-19 pandemic. Health and Welfare Director Dave Jeppesen and two other health officials sued to block the attorney general’s investigative demands.

Labrador’s office demanded that the health officials hand over records related to the program around the same time Idaho lawmakers approved an audit of the grants, amid concerns that the federal funds weren’t distributed properly. Lawmakers restricted the funding to programs that serve kids 5 to 13. The audit found that nearly 30% of grant applicants planned to use the funds on programs that served children outside that age range.

An Ada County judge last month ruled that Labrador had a “notable conflict of interest” when his office began investigating the grants and ordered the attorney general to appoint a special prosecutor to enforce the investigative demands.

At least six of Labrador’s attorneys assigned to represent the health department have quit or been fired, the Statesman previously reported. Huang and one other former deputy attorney general accused Labrador and his aides of unethical conduct by urging attorneys to side with him, and against their Health and Welfare clients.

Huang was a lead deputy attorney general assigned to the health department. Her job was to give health officials legal advice, as part of the office’s role as legal representative for state agencies and officials. Previously, Huang served as an assistant attorney general in Washington for 10 years and also worked as a federal law clerk, according to her lawsuit.

Huang fired after criticizing Labrador

“They (Idaho AG Office) … appear intent on dismantling government, and doing so without regard for the people who believe in public service who fall in their wake.”

In November and January, Huang issued two legal opinions that found the health department’s distribution of the child care grants was legally sound. The health department’s requests for the opinions were “routine” and “did not raise any red flags,” according to Huang’s lawsuit.

But former Chief Deputy Attorney General David Dewhirst and Solicitor General Theo Wold, who both worked under Labrador at the time, in a March 27 meeting with Huang “insinuated” that the department had “acted nefariously” in asking for the legal opinions and told Huang to view the department’s requests for legal advice with a “jaundiced eye,” the lawsuit said.

“When she protested that doing so would place her in an adversarial position with her client, they accused her of being in an adversarial position to her employer,” Huang’s attorneys wrote. “Ms. Huang felt pressured by the (Office of the Attorney General) to take a hostile position towards her client and regarding advice that she herself had given to her client. This was ethically unacceptable to Ms. Huang.”

Dewhirst and Wold also told Huang that she should have refused health officials access to the phone of a former deputy attorney general who represented the department, the lawsuit said. Health and Welfare previously told the Statesman the phone had been wiped of its data before being returned to the attorney general’s office, and that it’s standard procedure to reset a departing employee’s phone.

Dewhirst and Wold “tried to pressure Ms. Haung to agree with them that the department had acted inappropriately in taking the phone,” according to the lawsuit. Huang responded that tension between executives in the attorney general’s office and the health department put attorneys “in a very awkward position given that they had to continue to represent the department,” the lawsuit said.

Idaho law and Idaho State Bar ethical rules prohibit attorneys from advocating against their clients’ interests or breaching their clients’ confidence.

After the meeting with Dewhirst and Wold, Huang wrote a letter to Tom Donovan, who had recently been appointed chief of the attorney general’s health division. Huang wrote that Labrador and executives in the office “presented an untenable conflict of interest” without concern for “our ethical responsibilities,” according to a copy of the letter previously reported by the Statesman.

“They instead appear intent on dismantling government, and doing so without regard for the people who believe in public service who fall in their wake,” Huang wrote.

Dewhirst on March 29 asked for Huang’s resignation, records obtained by the Statesman showed. Huang refused to resign and was fired. Dewhirst has since left the office for a position with presidential candidate and Florida Republican Gov. Ron DeSantis.

Huang’s lawsuit asked the court to rule that her firing violated whistleblower protections and to award lost wages as well as attorney fees and compensatory damages for emotional distress and harm to her reputation. Huang also requested a jury trial.