For nearly three months, a company that worked with an ex-county contractor now embroiled in a criminal embezzlement case has tried – and failed – to hand the county $170,000.
Now the county says it will seek those funds in Superior Court.
SMRT1 Health Solutions supplied vending machines throughout the county as a subcontractor for the Harm Reduction Coalition of San Diego, which deployed overdose reversal drugs using SMRT1’s vending machines along with other outreach. The Harm Reduction Coalition, using county money, paid SMRT1 upfront for its related work before the nonprofit’s two county contracts were cancelled last June.
Months after ex-Harm Reduction Coalition COO Amy Knox was charged with misappropriating public funds, SMRT1’s attorney started asking the county to sign off on a settlement allowing the company to return $170,000 for work it was paid to do upfront but never completed once county officials cancelled the contracts. She said SMRT1 previously told the District Attorney’s Office about the extra funds. The proposed settlement SMRT1 pushed included a promise that the county and the Harm Reduction Coalition wouldn’t pursue future civil claims against SMRT1. Knox at one point served as executive vice president for SMRT1 but the company severed ties with her in February after she was criminally charged.
In May, a county lawyer repeatedly told attorney Sharon Appelbaum, who represents SMRT1, that he’d need to get back to her. In a May 26 email, Supervising Deputy County Counsel Andrew Gregor wrote that he didn’t have the authority to sign off on a settlement agreement. Appelbaum followed up again in June and they spoke on the phone. Then Gregor stopped responding.
“After many discussions and attempts to have the County of San Diego weigh in on this issue in any way in writing, that has come up empty,” Appelbaum wrote in July 16 court filing.
On Thursday, Appelbaum confirmed that the county had essentially ghosted her and SMRT1 following a conversation in June.
Given that silence, Superior Court Judge Alana Wong Robinson on Thursday ordered SMRT1 to deposit the $170,000 with the court.
After the court hearing Thursday, which no county lawyers attended, county spokesperson Tammy Glenn told Voice that the county is continuing to investigate the situation and considers it “premature to consider any releases of liability.”
But Glenn wanted to be clear that the county intends to collect.
“This Board of Supervisors has been consistently aggressive when it comes to every opportunity to recover public funds,” Glenn wrote. “The county intends to submit a claim of interest regarding these funds in the Amy Knox criminal prosecution.”
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