The university filed the suit on the same day that its board of trustees arrived in Lynchburg, Va., for its semiannual meeting, at which they are set to discuss the university’s future, including its search for a permanent leader. Jerry Prevo, a close associate of Mr. Falwell’s father and the former pastor of a large church in Alaska, has been serving as interim president since August. Mr. Prevo is also a member of the board’s powerful executive committee.
The suit is likely to rattle that normally placid gathering, which Mr. Falwell had used to dazzle the board with flashy presentations about Liberty’s growth and influence under his leadership. The suit alleges that Mr. Falwell deceived the board’s executive committee into redesigning his contract to include a higher severance payout if he resigned for “good reason” or if Liberty terminated his contract without cause. Mr. Falwell claimed to the committee that this would serve as a “safety valve” for both him and the university if his full-throated support of former President Donald J. Trump proved damaging to the school’s reputation.
The real reason for negotiating the deal, the suit claims, was to protect against the possibility that Giancarlo Granda, the former pool attendant who had the affair with Ms. Falwell, would publicly reveal his relationship with the family.
The suit says Falwell “improperly and errantly” told the press he was owed $10.5 million after his departure in August. His severance should have been $2.5 million, or two years’ salary under the higher salary he negotiated in 2019, the suit claims. “Liberty was unsure if Falwell Jr.’s representation to the media was just puffery and bragging or some attempt to set up a claim for additional compensation,” the suit says.
The suit also claims that Mr. Falwell used a non-Liberty email address and personal devices to conduct university business. Although Liberty paid for the devices and confidential university information is stored on them, Mr. Falwell has refused to return them or to provide access codes, the university alleges. The school is working with an independent forensic accounting firm to investigate its operations under Mr. Falwell; that investigation is ongoing.