Rehoboth Beach city manager lawsuit costs keep climbing

It’s been 20 months since a lawsuit was filed by two Rehoboth Beach property owners against the city over the hiring of City Manager Taylour Tedder in April 2024. 

Last July, about a year after the suit was filed, the Cape Gazette reported the city had spent about $150,000 defending itself against the lawsuit.

During the city manager’s report of a commissioner meeting April 17, Commissioner Suzanne Goode repeated claims from a constituent at a previous meeting that costs for the lawsuit had now topped half a million dollars. Those costs will continue to grow because of depositions and other occurrences in the months ahead, she said.

While the amount of money the city has spent on the lawsuit in the past year has increased, it has not reached the amount Goode claims. 

The total to date is a little less than $382,000, said Brooke Thaler, city communications director, in an email April 22. The city doesn’t know where the half a million dollars claim came from, besides public comment at a recent meeting, which was then repeated by Goode, she said.

Tedder began working for Rehoboth Beach in May 2024. Among other things, his contract calls for a $250,000 annual salary, plus $50,000 in moving expenses and a $750,000 home loan that will be forgiven in full if he stays for seven years.

A few months later, August 2024, attorney Theodore Kittila filed a lawsuit against the city on behalf of property owners Steven Linehan and Thomas Gaynor.

A little less than a year after the lawsuit was filed, July 2025, City Solicitor Lisa Borin Ogden provided an update during a meeting, saying that a settlement had been offered to the city seeking the resignation of elected officials. The specific individuals were not named and no one resigned.

Goode brought the subject up at the recent meeting in the context of being informed if the plaintiffs offer the city a new settlement agreement. There was trouble obtaining the settlement offer last summer, she said, and if another offer is made, commissioners should be provided with that information sooner.

Everyone will be notified promptly, said Mayor Stan Mills.

Beyond costs, Thaler declined to comment on the lawsuit. Discussion of settlement outside of executive session is inappropriate, so the city won’t be able to comment on that, she said.

Looking forward, it’s unclear when the lawsuit will be resolved.

As for the timeline, the city can’t provide one at this point, said Thaler.

Kittila declined to comment.