Gag in place for new Myrtle Beach downtown leader. ‘What are they really trying to hide’?

A gag is a restriction on information. The Myrtle Beach Downtown Alliance continues the practice of trying to limit speech.

Past and present CEOs for the taxpayer-funded organization tasked with revitalizing downtown Myrtle Beach are prevented from saying anything that might be considered “disparaging.”

Was there previous misuse of taxpayer funds, are outside forces controlling the board members, or were companies misled about downtown revitalization?

The public may never know if that happened in the past 19 months since the Myrtle Beach Downtown Alliance was formed, or if it happens in the future.

When former Myrtle Beach Downtown Alliance CEO Amy Barrett left her position and was replaced, and her replacement was paid more, she did not speak about why she left or what transpired. That could be for fear of legal repercussions due to her contract.

Free speech and government transparency advocates see restricting information as bad for democracy and taxpayers.

The Sun News reporting has called into question the procedure used by the Myrtle Beach Downtown Alliance to fill their CEO position, which was never advertised to the public. No search firms were used to find the best candidates, and no interviews were conducted.

When newly appointed board member Dan Sine, who became chairman of the board at his first meeting on March 14, made the employment offer to his friend and longtime acquaintance Jason Greene, he said the non-disclosure agreement included was a mistake because he used a boilerplate employment offer letter.

A review of the employment contract voted on by the Myrtle Beach Downtown Alliance board members on Wednesday shows that the contract avoided using the term non-disclosure agreement, or NDA, but the contract certainly restricts speech.

Sine declined to speak to a reporter for this story, instead insisting on the submission of written questions, which The Sun News agrees to only in rare situations when no other avenue is practical. The newspaper also rejected a request from Benjamin Broody, the Myrtle Beach Downtown Alliance attorney who drafted the contract, to negotiate “rules of engagement” and provide information before he was willing to agree to an interview.

Dan Sine is new chairman of the Myrtle Beach Downtown Alliance board of directors
Dan Sine is new chairman of the Myrtle Beach Downtown Alliance board of directors

Sine did send an email saying, “Jason’s employment contract includes no Non-Disclosure Agreement (NDA) clauses.”

Reader and taxpayers can make their own conclusions.

Why could Myrtle Beach taxpayers be concerned about gagging those managing public dollars?

The employment contract has “restrictive covenants” barring the new employee from any speech that could impact the goodwill and reputation of the corporation and it’s board members.

The contract states in part, “employee specifically agrees not to take any action that impairs the goodwill and reputation of the Corporation or any of the Protected Parties through posting comments and/or reviews on internet platforms, sending letters, texts, and other electronic messages, and speaking on radio, television, video, or podcasting platforms/broadcasts/services.”

So it doesn’t say it’s a non-disclosure agreement. What’s the big deal?

Allen Cheney, legal director for the ACLU of South Carolina, said he was unfamiliar with specifics of the downtown alliance contract but in general, “there’s no technical difference that springs to mind” between a non-disclosure agreement and restrictive covenants.

Cheney also supports the idea of not restricting information and promoting transparency for the public.

“Our position generally speaking is we support a maximum view of what the public should have access to when it comes to public entities,” he said.

The Myrtle Beach Downtown Alliance receives money directly from the City of Myrtle Beach and from some property owners. The organization acts as a quasi-governmental agency and therefore has to follow similar rules and laws for disclosure and transparency.

Greene and any other employees would still also be responsible for any other South Carolina statutes or law regarding employment, confidentiality and economic development already.

The Sun News has asked Sine to provide his emails and text messages that discuss the employment contract.

Non-disclosure agreements are uncommon for employees who are paid using taxpayer funds and it sets a potentially dangerous precedent that can harm democracy, transparency and ultimately taxpayer who are funding the multi-million dollar operation, said S.C. Press Association attorney Taylor Smith.

“Non-disclosure agreements impact our marketplace of ideas, and when that marketplace concerns how public money is used or how decisions are made about public business, the harm to the marketplace can be extreme,” Smith said. “Agreements that suppress information which could be used to create a better-formed democracy ... are things that should be avoided.”

There are legal questions about the enforceability of non-disclosure agreements and restrictive covenants. Some legislators, like Alabama State Rep. Chris Pringle, R-Mobile, discussed plans to file legislation banning non-disclosure agreements involving taxpayer dollars.

#NDAFree is a global movement with a vision to free “individuals, Christian organizations and local churches” from the misuse of non-disclosure agreements.

This is what the group says about non-disparagement clauses.

“Whilst we shouldn’t ‘bad-mouth’ people, however truthful those comments may be, a non-disparagement clause goes far beyond a legal restriction on gossip. It prevents you saying anything negative at all. So if you talk about a harmful company product or an abusive executive with the aim of protecting other people, you can still be accused of disparagement.”

The group also points out that “disparagement is different from defamation. Disparagement includes truthful statements about the company, while defamation only covers false statements.”

The South Carolina Press Association attorney sums up a significant concern with gagging employees funded and responsible for managing public dollars.

“Particularly since NDAs are disfavored by courts, it seems like it would be easier just to have trade secrets language in there so it kind of begs the question, ‘what are they really trying to hide?’” he said.