In a sport as desperate for sponsorship as cycling, there is little room to reject potential supporters based on principal. Ineos' entry into the WorldTour was met with criticism due to the company's fracking and plastics business, Bahrain, UAE and Qatar's involvement in cycling as well as the Giro d'Italia's start in Israel were tinged with concerns over human rights violations, and the 'me-too' movement has ousted a number of powerful figures in other sports and industries. Cases big and small raise the question: can cycling afford to exclude sponsors based on ethics?
When a New Mexico medical provider stepped up to help sponsor a composite women's cycling team for the Tour of the Gila this year, it helped give six women an opportunity to compete in the UCI 2.2-sanctioned stage race. The CEO of the nonprofit medical services provider Hidalgo Medical Services [HMS] Dan Otero said he "saw an opportunity to make an impact" by supporting the team.
But the team and others didn't know that HMS just settled a second sexual harassment lawsuit against Otero, and, according to the civil complaints and multiple current and former employees, the medical provider has done little to curtail an alleged culture of bullying, sexual harassment by its CEO, and age discrimination of female employees.
The team competing at Tour of the Gila was organised by the Lux Development team and directed by Michael Engleman, who, according to race organiser Jack Brennan, reached out to him about fielding a composite team, "and we said perhaps HMS would be interested".
Brennan told Cyclingnews that he knew nothing of the sexual harassment cases.
"HMS is a substantial sponsor for the Tour of the Gila this year, and they wanted to know what else they could do for women's cycling," Brennan said. "We said there’s this women’s team and we can get some incredible women to come race on this team, to give more women a chance to race at Gila. There just aren’t that many women’s teams out there. It’s expensive to get here and stay here."
When asked if he knew of the lawsuits against Otero, Brennan said, "This is the first I've even heard of this. My feeling is that Dan works for a board of directors. If Dan was involved in these things, and I don’t have a clue if he was or not. If Dan was involved, I would think the board would get rid of someone like that."
Brennan defended HMS' involvement with the race, calling this story "a hit job" and saying he thought it was odd to be "going after someone who is willing to help women’s cycling".
"He’s not in the car. He’s a financial backer. It’s not like he’s there in the car, pits, he’s running his business during the week, and the girls are out racing. There has been very little interaction between the folks at HMS and the women’s team."
HMS and Otero
Otero became CEO of HMS in February 2016, and soon found himself contesting a lawsuit that he sexually harassed a high-level female employee who had been with the organization for 21 years.
The woman reported that Otero "pushed himself up against her and grinded up against her," wanted to "bump chests" with her, hugged her against her will, looked at her with "creepy" "elevator eyes," made unwelcome comments about her clothing and how she looked, and asked her out for dinner and drinks and to travel with him, despite her telling him no and that she was married.
In the complaint which was defended by Otero, it notes that HMS admitted to the NM Human Rights Bureau that Otero had a "hugging problem" and underwent Crisis Prevention Intervention training. However, despite this, his behavior allegedly remained the same. It also notes that five female employees of HMS had filed charges of discrimination or reported sexual harassment and HMS refused to take remedial action.
According to the complaint, on Nov. 14, 2016, the day the employee rebuked Otero's request to travel with him – and told him to stop his sexual harassment – he put her on administrative leave and terminated her the following month.
In her 21-year career with HMS prior to Otero becoming CEO, she was never reprimanded verbally or in writing and had received positive evaluations from the previous CEO, the complaint notes. It also notes that the employee discovered double billing in the mental health department and neither Otero nor HMS investigated.
The employee sued for $1.2 million in economic damages from her illegal termination, and the case was settled in a confidential agreement on October 23, 2018, according to court documents. Tim White, attorney for the plaintiff, would not comment on the case when contacted via email on Jan. 22, 2019.
A second case of sexual harassment was settled just weeks before the Tour of the Gila on April 16, according to a source close to the case - two days before HMS' sponsorship of the team was announced. In the second case, another high level female employee reported Otero forcibly hugged her, pushing up against and grinding against her in a sexual way, forcibly caressing her hand in a sexual way, and undressing her with his eyes.
Otero placed her on administrative leave within minutes of receiving her amended charge of discrimination, and she was later terminated and, in front of other HMS employees, was escorted to collect her belongings and then walked out of the building. Again, prior to Otero becoming CEO, she had never been reprimanded in writing and had received positive evaluations by her supervisors.
That complaint alleges HMS has a culture that tolerates and encourages sexual harassment and discrimination. Even after four females complained of or reported sexual harassment by Otero, HMS took no remedial action and "rather than address the problem, Defendant HMS seeks to silence [and terminate] those employees who reported discrimination and harassment," it reads.
Albuquerque attorney Duff Westbrook, who represented that victim of sexual harassment, said, "The case was settled to the mutual satisfaction of both parties."
None of the attorneys for HMS or Otero or board Chairwoman Carmen Acosta responded to phone calls or emails last week, including Attorney Robert Hanson HMS coverage counsel; attorneys Randi Valverde and Randy Bartel with Montgomery & Andrews, P.A. of Santa Fe, lead attorneys for HMS; Denise Michelle Chanez with the Rodey Law Firm of Albuquerque, attorney for Otero; Gena Sluga, the attorney representing Philadelphia Indemnity; and attorneys Ben Furth and Paul Darby Hibner with the Furth Law Firm in Las Cruces, both previously representing one of the victims.
HMS Employees talk about "culture of bullying"
Several former and current HMS employees, who would only speak under the condition that they remain anonymous for fear of retaliation, said that HMS and the board have allowed the culture of bullying and Otero's sexual harassment to go on unchecked.
"My biggest disappointed is our board," one said. "They keep everything pretty secretive. I don't understand why they have allowed this to go on."
That employee described a "miserable" experience for the two women when dealing with Otero, to whom they reported.
One woman reported witnessing Otero "touching other young female employees, hugging them for a long period of time, playing with their hair, he'd rub their shoulders," she said. "They didn't see me half the time because he was so intrigued with the young women," she said.
Another older female employee said she experienced a culture of bullying, harassment, micro-management and secrecy from the moment Otero came on as CEO until they fired her several years later.
"People who are scared to say something are unable to get a job elsewhere," she said. "The old boy network is alive and well in HMS."