Bad Environment

In fall 2018, Melody Isaak, deputy director of human resources for the North Carolina Department of Environmental Quality, met in her office at department headquarters in downtown Raleigh with two of her HR colleagues.

The three women, all Black, met in Isaak’s office from time to time, and were visible to colleagues who walked by in the hallway that connected the HR offices to the DEQ secretary’s suite.

“They need to quit holding those Black Klan pep-rally meetings,” a department employee was overheard saying, according to a lawsuit Isaak filed last year in Wake County Superior Court. “This is a place of business.”

Isaak says a custodian who cleans DEQ offices told her John Nicholson, the department’s deputy secretary, made the comment. Nicholson is white.

Isaak, who had been a state employee for more than 25 years, eventually reported the incident to her boss, Michael Regan, the former DEQ secretary. He now leads the U.S. Environmental Protection Agency, the first Black man to serve in that role.

She says Regan tried to cover up the allegations, then “cooked up” a scenario to fire her in 2020, actions she contends are retaliatory.

Her whistleblower lawsuit, which has not been previously reported, seeks damages and legal fees from the department, Regan, and Nicholson. Under North Carolina law, state employees can’t be retaliated against for reporting improper government activity.

Isaak’s suit includes allegations of racism, an increasingly antagonistic work environment, and the lack of a full investigation into a charge against the department’s second-highest ranking official.

The lawsuit could have implications beyond North Carolina state government. Regan is a member of President Biden’s cabinet, and Nicholson is now chief of staff in the EPA Office of the Regional Administrator in Atlanta.

Isaak contends Nicholson played a major role in episodes that started in 2017 and built to a crescendo over three years before coming to an end in August 2020, when she lost her job.

Nicholson is a retired colonel in the U.S. Marine Corps who served as the military affairs advisor to Govs. Beverly Perdue and Pat McCrory. He was a policy consultant to the nonprofit Environmental Defense Fund in 2016, when Regan also worked there. Nicholson followed Regan to the DEQ and then to the EPA.

The Department of Environmental Quality is part of Gov. Roy Cooper’s administration. Isaak got a new HR job in that administration, at the state Department of Commerce, less than two months after her termination at the DEQ, an indication that she is viewed as a valuable employee.

Isaak, 55, says she is not seeking vengeance. She wants to shine a light on activity, overseen by Regan, that she says led to an unfair depiction of her work ethic and performance.

“To be treated in the way that I was, for doing nothing wrong, is wrong,” Isaak told The Assembly. “I want justice for myself.”

She is represented by Raleigh lawyer Jack Nichols, a Democrat who recently was appointed to fill a vacant seat in the North Carolina House of Representatives.

The Assembly sought comment from Regan and Nicholson. An EPA spokesperson referred the matter to the North Carolina Attorney General’s office, which filed the state’s response to the lawsuit. A spokesperson for the office declined comment because the lawsuit is pending.

In a Wake County Superior Court filing, Regan, Nicholson, and the DEQ have asked that the case be dismissed, and sought to block any further requests for documents and information related to the lawsuit until a judge has ruled on their motion.

In the filing, Nicholson denied making the Black Klan comment, and he and Regan disputed many of Isaak’s allegations. They rejected Isaak’s assertion that they conspired to fire her, and say that she lost her job for mishandling a complaint filed in HR.

Regan, 46, grew up in Goldsboro and has risen through the ranks in environmental protection jobs, billing himself as someone who fosters consensus through dialogue.

A graduate of North Carolina A&T State University, Regan started his career at the EPA. He was Cooper’s first environmental secretary, overseeing the largest coal-ash cleanup in U.S. history and developing a “seminal plan to address climate change and transition the state to a clean energy economy,” according to the EPA website.

Regan seeks solutions, he has said, by trying to bring together opposing sides and find common ground. That didn’t happen in Isaak’s case.

Before the custodian alerted Isaak to the “Black Klan pep rally” comment, he let her know that Nicholson had been complaining about her.

In November 2017, Isaak says Charlie Bryant, the contract worker who cleaned the fifth floor of a building in the Green Square Complex in Raleigh, told her that Nicholson said she was filing for too much comp time.

At the time, Isaak was deputy HR director, a job she held for 13 years. She had met or exceeded work expectations in reviews, according to her lawsuit.

Isaak asked her supervisor, Ursula Hairston, whether Nicholson had complained to her about her hours and comp days. Hairston acknowledged that he had, according to Isaak’s lawsuit.

About six months later, Hairston told her that Nicholson had complained about her again, this time about her meeting frequently in her office with the two Black, female DEQ employees. Hairston suggested closing her office door to avoid unnecessary scrutiny.

Then in October 2018, Isaak said she heard from the custodian again.

While cleaning near a water fountain, Bryant told her that he heard two white men talking outside the HR management suite. One of them, whom he believed to be Nicholson, made the Black Klan comment, the lawsuit says.

Several months later, Bryant told her he had seen Nicholson hovering outside her office while she was meeting with the two Black colleagues.

Isaak feared she was being targeted. She went to her supervisor again, telling her that it was Nicholson who had made the comment about Black Klan pep rallies.

Nicholson was not immediately informed of that discussion, Isaak said.

A couple of months later, the DEQ was looking for a new HR director. Isaak applied. She discussed the job with Nicholson in October 2019, when he let her know Regan was considering her for the post.

The next month, after getting the job, Isaak met with Nicholson and Regan to discuss her responsibilities.

That meeting led to a revelation about the DEQ leadership team’s propensity for putting as little as possible in writing.

Isaak recounted that Regan admonished her for putting her salary request in a text to Nicholson, something she said Nicholson had asked her to do. Regan was more concerned, according to Isaak, that a written record would be subject to discovery in a lawsuit or public records request.

(In a filing, Nicholson denied that he asked Isaak to put her salary request in writing. A memo included in responses to the lawsuit lists the salary she accepted as $112,000. Read the responses from Nicholson, Regan, and the state here.)

Regan directed Isaak to “cut the apron strings” with the two Black colleagues, “as he indicated that he received reports that Dr. Isaak was meeting with them too frequently,” according to the lawsuit.

The tone of the session troubled Isaak, who contends that it closed with Regan telling her “hopefully by the time this meeting is over, I’ll have you feeling really paranoid.”

Several months later, Isaak sought a meeting with Regan, and met with him in her office. She says she revealed the complaint about Nicholson and the name of the custodian, whom she said had given her permission to do so.

Regan put his hand on a Bible on her file cabinet, the lawsuit says. “I swear that I will not share [the custodian’s] name, and I will protect you and make sure that you are not retaliated against,” Regan said.

Regan called the matter “very serious,” according to Isaak, and added that he would have to think about how to proceed, given it was an election year.

Isaak said Regan initially took steps to address her complaint. He met with her, found out who she had discussed the matter with, and then met with Nicholson.

But in a meeting in early March 2020, Regan told her that Nicholson was angry about the matter, and contended that it was a “set-up,” the lawsuit says. Regan said he planned to keep the matter within DEQ instead of going to the Office of State Personnel for an outside review.

Regan also told Isaak that Nicholson wanted her and the three women she had told about the comment to prepare written statements saying they did not believe Nicholson was a racist. The lawsuit says Regan planned to place the documents in his desk drawer rather than including them in personnel files.

“I believe he’s a politician,” Isaak said of Regan. “It wasn’t important for him to find the truth.”

Instead, she accused Regan of trying to cover up the complaint. The suit says Regan and Nicholson pressured Isaak to make a statement that repudiated the complaint from the custodian and supported Nicholson. She refused.

In a filing, Nicholson denied asking Isaak to make a statement. That filing doesn’t include that same question to Regan or a response from him.

The months ahead were filled with actions by Regan and Nicholson that Isaak contends were retaliatory.

Regan, her immediate supervisor, stopped meeting with her in mid-March of 2020, she contends, and instructed her to report to Nicholson on discussions about HR matters, even though he had been the subject of her complaint.

That summer, Isaak was informed that an employee in the safety division had filed an internal complaint about her and another person, alleging discriminatory conduct.

On Aug. 20, 2020, Isaak attended a conference with Regan in which he informed her he was considering dismissing her from her position. Isaak had been accused of mishandling the complaint; in a response to her lawsuit, the state said Isaak failed to recuse herself “despite a known conflict of interest,” and sought to have the complaint withdrawn.

Isaak said she asked Regan for the results of that investigation. “I am not here to be on trial or answer other questions,” Regan said, according to Isaak.

The next day, Isaak received a dismissal letter.

Isaak went to college intending to become a journalist. She did an internship at a TV station before finding out that she was drawn more to working in human resource offices.

She worked in the private sector for five years, then found her way into state employment.

She went from the North Carolina State University College of Veterinary Medicine, to the Department of Health and Human Services, to the DEQ (when it was called the Department of Environment and Natural Resources), to the state Department of Corrections for 18 months before returning to the DEQ.

She likes to think she was fair, honest, and worked with integrity.

Isaak sought relief from the Office of Administrative Hearings, which hears appeals from state employees, but her complaint was dismissed. As HR director, she agreed to become a “managerial” at-will employee without some of the protections that other state employees have, Regan and Nicholson pointed out in responses to her lawsuit.

Though she landed a job at the Department of Commerce shortly after her termination, Isaak said she decided to file a lawsuit against Regan, Nicholson, and the DEQ even if it means working “two and three jobs.”

She knows a jury can be unpredictable. She goes into court thinking she will win her case, but knows she might not.

“I want it to be a matter of record and for the public to know,” Isaak said. “Justice, with all due respect, is not always served by guilty or not guilty. Justice is for them to be held accountable, and in a public forum.”