West Virginia Record

Monday, December 9, 2019

Former Wheeling University president sues university, others for hiding school’s financial troubles

State Court

By Kyla Asbury | Oct 7, 2019


WHEELING — The former president of Wheeling University is suing the university and others du to not being fully informed of the school’s financial troubles upon being offered the position.

Michael Mihalyo filed the lawsuit against the university, formerly known as Wheeling Jesuit University; the Board of Trustees of Wheeling Jesuit University; the Diocese of Wheeling Charleston; Diocesan Realty Inc.; Monsignor Kevin Quirk; Bishop Michael Bransfield; Bishop Mark Brennan; Archbishop William E. Lori; Ginny Favede; Dr. Edward Shahady; and John Doe, alleging he was misled about the university’s financial issues prior taking over as president, according to a complaint filed Oct. 4 in Ohio Circuit Court.

Mihalyo was previously the Vice President of academic affairs at Rockford University in Rockford, Ill., until he applied to be president at Wheeling in 2018. He claims prior to being recruited for the position, the financial condition of the university was horrific, which he was unaware of until after he took over as president.

From 2014 until 2018, the number of students enrolled at the university decreased by 27 percent and scholarship discount allowances increased to 41.7 percent, which meant new tuition and fees only covered roughly half of all expenditures, which caused the university to become increasingly dependent on federal and private grants, as well as investment income, according to the suit.

Mihalyo claims grants also had decreased by 82 percent, which he didn’t discover until after taking over as president.

The defendants were advised of the poor financial condition of the university, but rather than take steps to improve it, the defendants instead engaged in a calculated and systemic campaign of misappropriation, misdirection and fraud to conceal the true financial state of the university, according to the suit

Mihalyo claims within the first seven months of his employment, he uncovered the financial problems and the university was aware that it didn’t have the funds to sustain the full school year from 2019-20, but continued the school year anyway.

Mihalyo claims if the defendants had provided him with a truthful account of the financial situation of the university, he would not have entered into an employment contract with the school and he would not have left his employment with Rockford University.

The former president alleges he was retaliated against for hiring an outside auditing company to look into the financial state of the university and other misappropriations of funds, according to the suit.

The university put Mihalyo on leave in August before announcing Favede would be its new president.

Mihalyo claims he suffered significant physical, psychological and personal injury due to the defendants’ actions, including shame, embarrassment, lost wages and diminished capacity to enjoy life.

Mihalyo is seeking compensatory damages. He is represented by Teresa C. Toriseva and Joshua D. Miller of Toriseva Law in Wheeling.

Ohio Circuit Court Case number: 19-C-253

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