Wright State sues its own former research funding arm

Wright State University sued this week its own former research funding arm, alleging the agency refuses to return state property and money after separating from the university.

The lawsuit against Wright State Applied Research Corp. was filed Thursday in Greene County Common Pleas Court.

The university created the corporation in 2011 as a separate nonprofit to coordinate its research funding. The relationship between the two entities has evolved following scandals tied to WSARC around misuse of federal work visas, improper payments to a high-dollar consultant and financial problems.

ExploreWright State’s affiliation with research funding group ends in October

After the expiration of an affiliation agreement with the university expires this month, WSARC intends to change its name to Parallax Applied Research Corp. The separation will mean about 70 researchers and support staff who worked for WSU — under a contract wherein WSARC reimbursed the university — will now work solely for the research corporation.

“While that action may bring a new name to the organization, it does not erase the corporation’s history,” said a statement from WSU. “WSARC operates as an independent corporation and has been the subject of numerous lawsuits and both federal and state investigations over the past few years. Some of those investigations have resulted in the announcement of findings for recovery of state funds — which remain outstanding even today.”

The lawsuit says research corporation owes Wright State University for its headquarters building on Colonel Glenn Highway and millions of dollars of goods and services purchased with grant funds.

“All of the issues cited by the university took place 10 years ago and were, in fact, created by the university’s own actions. And, none of the current WSARC executives or board directors were associated with WSARC at that time,” WSARC said in a statement released Friday calling the university’s claims false.

WSARC Board of Directors Chair Gayle Rominger said in an interview Friday that the research corporation has been trying all year to settle differences with Wright State and even establish a new partnership agreement, but the university wouldn’t cooperate or even agree to mediation.

“It just makes no business sense to me to spend all this money on this lawsuit,” she said.

WSARC says it has been self-supporting since mid-2016 and contributes to the university’s finances instead of relying on subsidies. It says under its CEO Dennis Andersh, agency revenues have grown from $15.1 million in 2016 to $30.6 million now.

“The issues raised are from the past university administration and under Andersh’s leadership WSARC has remedied those issues and created a vibrant and compliant organization,” WSARC’s statement says.

Wright State says the research center is currently financially stable after years of struggling to survive and exists only because of the university’s investments.

ExploreWright State research corporation seeks to block records release to Dayton Daily News

“Through discussions that have taken place over the past several months, it has become clear that the corporation wants to walk away from responsibilities and obligations associated with Wright State,” the release says. “The university believes that the corporation may be in possession of capital assets that must be returned before the university could support the proposed separation. WSARC has also refused the university’s demands for the return of the funds invested by Wright State to support the corporation.”

Rominger said Wright State and the applied research center should work together to bolster the region’s competitiveness in getting research contracts with entities such as Air Force Research Laboratory based at Wright-Patterson Air Force Base.

“It makes no sense why these two organization wouldn’t collaborate and work together for the betterment of the region and the state,” she said.

Another legal case pending in Greene County courts was filed by WSARC against Wright State University on Oct. 5 seeking an injunction to prevent the university from providing the Dayton Daily News emails to and from Andersh. Wright State University intended to release the emails in response to a public records request but WSARC claims they are protected under attorney-client privilege.

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