NU Online News Service, March 23, 11:58 a.m.EST

Penn State is telling subpoenaed employees to hire their ownattorneys, which may be paid for by the university's directors andofficers' insurance coverage.

The university, under the microscope since former assistantfootball coach Jerry Sandusky was charged with 52 counts of childsex abuse, received a subpoena in February from the U.S. attorney'soffice in Pennsylvania.

This month, the state Attorney General served additionalsubpoenas to an unspecified number of Penn State employees,according to the university, whose general counsel says will remainanonymous unless they reveal themselves.

On its “Openness” website the State College, Pa.-baseduniversity this week released the following statement about thepayment of legal fees for employees: “The university is suggestingthose individuals who received subpoenas retain their own counseland the university will agree to reimburse them for their legalexpenses, as they were acting within the scope of their employmentand in the interest of the university.”

“Expenses of such counsel may be paid by the university'sD&O insurance carrier.”

Penn State and its primary general liability insurer,Pennsylvania Manufacturer's Associations Insurance Co. (PMA), havefiled lawsuits against each other over legal expenses.

Penn State says its policy with PMA entitles the school to alegal defense of a civil lawsuit filed against the universityregarding the allegations against Sandusky.

PMA says it has no duty to defend the university.

NU has learned Penn State is also a policyholder ofUnited Educators, but the insurer could not comment further.

A civil suit would be filed after the criminal case againstSandusky is settled. Penn State is not immune from civil suit because it is not astate-owned school, or member of the Pennsylvania State System ofHigher Education (PASSHE).

Membership here may have provided a measure of immunity underthe Sovereign Immunity Act, which as a general rule, says a stateentity is immune from suit.

As of Jan. 31, Penn State has spent more than $813,000 onuniversity legal services and defense, according to its website.The university says an additional $338,545 has been spent on thelegal defense of Graham Spanier, Tim Curley and Gary Schultz.

Penn State says Spanier resigned as its president lastNovember.

Curley, the school's athletic director, faces perjury chargesrelated to the Sandusky case. He has been suspended.

Schultz, former Penn State vice president, also faces perjurycharges.

Penn State says its bylaws state every trustee and officer ofthe university is entitled to be indemnified by the university forlegal fees, as well as judgments, settlement amounts, fines andpenalties related to actual or threatened lawsuits orinvestigations.