By News-Register staff • 

Dentist's suit against former employees thrown out

A Yamhill County Circuit Court jury ruled Wednesday in favor of former longtime Advanced Smile Design employees Linda Hixson and Sherry McMullen, who were sued by McMinnville dentist Dr. James Nelson.

The jury also awarded damages of more than $800,000 to the defendants, who filed two counterclaims against the dentist and his business, one for malicious prosecution and the other for infliction of intentional emotional distress.

Hixson received $425,000 and McMullen $413,596, but only on the malicious prosecution claim. There was no intent to inflict emotional distress on the defendants, the 12-person jury decided.

The dental office initially triggered a police investigation leading to the arrest and filing of criminal charges against Hixson and McMullen.

However, the charges, four counts each of first-degree theft — a Class C felony — were dismissed by the district attorney’s office.

Judge Cynthia Easterday presided over the 13-day civil trial. It was originally scheduled for five days.

The jury ruled Hixson and McMullen did not misappropriate funds in numerous ways as was alleged in the suit.

Jurors were charged with deciding if the defendants were guilty of wrongfully taking property, breaching a duty of loyalty and committing fraud against Nelson and his business.

The jury ruled against the plaintiffs and also in favor of Hixson related to an alleged breach of fiduciary duty.

Nelson, his wife, Wendy Nelson-Baca, and the business were original named plaintiffs in the suit filed in March 2016. Nelson-Baca was removed from the complaint earlier this year.

Hixson worked for Nelson about 23 years, serving most recently as office manager. Her duties included accounts payable, accounts receivable, bank deposits, insurance billing, mail handling and payroll.

McMullen worked for Nelson as a dental assistant about 24 years.

The civil suit was filed by Mitchell Cogen of the Portland firm of Bullard Law. It sought damages in an amount to be determined at trial. The complaint stated in part:

The business had and still has a timekeeping system that tracks employee hours for payroll purposes. Employees check in and out through the system.

Hixson was responsible for calculating employee hours and entering that data into the system. She was also tasked with tracking vacation hours earned and taken.

In early 2013, the business was suffering from “inexplicably poor financial performance,” so Nelson asked his wife, who possessed accounting, budgeting and recordkeeping experience, to analyze its financials. Based on that, she accused the office employees of:

n Alteration of timesheets in order to receive pay for time not worked.

n Manipulation of vacation accruals to increase vacation payouts.

n Payment of unauthorized stipends.

n Filing of fraudulent unemployment claims.

Like the failed criminal case, the suit alleged Nelson and his wife believed Hixson and McMullen had engaged in unauthorized actions dating to at least 2007, continuing through June 2013 for Hixson and June 2014 for McMullen.

In an unrelated case, Wendy Nelson-Baca is suing the State of Oregon and its Department of Human Services and several employees for employment discrimination and civil rights violations. She is seeking $3 million in economic and non-economic damages, plus legal fees.

According to documents filed by her lawyer, David L. Kramer of Salem, Nelson-Baca worked for the department from 1986 until July 17, 2017, when her employment was terminated following an investigation sparked by a union complaint.

The lawsuit alleges Nelson-Baca was targeted for multiple complaints she made between 2013 and 2016 to senior manangement, including warnings of legal violations she alleged against the Oregon Health Authority’s handling of state and federal Medicaid money and applicants.

The lawsuit was filed Februrary 15. The state has yet to file its response.



This case was was thrown out of criminal court, then civil court! No amount of money could make up for the devastating stress and embarrassment this had on the two defendants' families, but so thankful they were able to clear their names and receive something! Great job jury!! And bless those two brave women.

F. Bank

Hopefully we will all think of this when we go to look for a new dentist..Seems as though this dentist was led by his jealous wife. So glad that the two women in this case are now free to lead their lifes. The fact that they were arrested and their mug shots were in the paper is disgusting. Karma is a wonderful thing, Nelson-Baca got her serving as did her husband.


I find it odd that the employer would be financially responsible for "malicious prosecution."
I always thought that it worked something like this: The employer notifies the police that he thinks his employee's are embezzling money, and then the police conduct an investigation. If the police determine their is probable cause that a crime has been committed they turn it over to the DA. If the DA also feels that a crime has been committed and that they can prove it beyond a reasonable doubt, they prosecute the defendants. If that's how it works, how could the employer be the one liable for the "malicious prosecution."


Investigate is what the police and DA are suppose to do Joel2828 but they did NOT in this case. They simply believed the fabricated spreadsheets made up by Wendy Nelson-Baca and did not do any other investigating. They did not question other employees, the accountant and other professionals that would have validated that these women were innocent. Instead they believed a jealous, vindictive, narcissist women and her spineless husband. Dr. Nelson knew the truth all along but was clearly too afraid of his wife’s evil wrath. These good, hardworking women have gone through hell these last five years and are deserving of what the jury awarded them. The jury saw what this dentist and his evil wife did to inflict malicious prosecution. The jury saw a clear, well thought out plan by these two to have these women arrested, handcuffed, house ransacked. All as their families were left to watch helplessly. Not to mention a mugshot that will always be on the internet. There is no money that will ever be sufficient to equal the pain and humiliation these women have had to endure. All of this could have been avoided if the police and DA had done their job in the first place and investigated beyond the fabricated spreadsheets of Wendy Nelson-Baca.


Causing a case to be pursued intentionally and without probable cause can be seen as malicious. Likely some facts given to law enforcement were found to be false or misleading. Clearly Ms Baca’s Side of the story didn’t pass the smell test....
And Kudos to the NR for providing some follow up on the often we see only the accusation.


My dentist for 35 years. A once thriving, and I do mean thriving, practice now totally in the toilet. All because James didn’t have the spine or the gonads to stand up to his vindictive wife and put a stop to this. Many patients have left over the past few years and that exodus will only continue now(not all that many remain anyway). Very sad for a good guy like James but he has only himself to blame. He literally let his wife take over. Don’t see much of a future for what was once one of the most patronized dentistries in the area.


So grateful that the justice system got this case RIGHT! I'm thankful to the jury that sat for 13 days listening to this case. Sherry and Linda are outstanding members of this community and I'm honored to call them my friends! I'm grateful that I was able to testify on their behalf! God is GREAT and I'm thankful that they continued to fight for what was the TRUTH!


I smell a rat with a hyphenated name.

Jeb Bladine

Just for clarification:

The "malicious prosecution" claim has nothing to do with the original criminal charges filed by the District Attorney's Office. Rather, it was part of the "Counterclaim" by the two women in response to the civil case filed after criminal charges were dropped.

Some states call it "Abuse of Process" in a civil case. Either way, it refers to a course of either civil or criminal prosecution after someone has already won one case. In this case, the jury decided the extended civil lawsuit did represent malicious prosecution and awarded all damages requested. The jury did not find that the plaintiff had intent to inflict emotional distress, which could have resulted in a higher financial penalty.

Kim Faden McClendon

With all respect, Mr. Bladine, your clarification is quite inaccurate. The malicious prosecution claim specifically related to the criminal charges brought against Ms. Hixson and Ms. McMullen. Dr. Nelson and his wife Wendy Nelson-Baca (as co-owner of Advanced Smile Design) gave false information to the police, the grand jury, and the D.A. The false information led to the arrests of these innocent women, and they were charged with felonies that could have possibly resulted in life in prison if consecutively sentenced. Thanks to excellent criminal defense attorneys who investigated where others failed to, the criminal charges were dropped. Nonetheless, Ms Hixson’s and Ms McMullen’s mug shots and stories of their arrest will forever live on the internet. This newspaper owes these women the decency to get the facts straight and accurately report what happened. One starting point would be to correct this misleading headline that the dentist’s case was merely “thrown out.” What in fact happened, was that a jury rendered a verdict wholly rejecting Dr. Nelson and Advanced Smile Design, and rendered a verdict in favor of Ms. Hixson and Ms. McMullen completely announcing their innocence and awarding damages against Nelson and Advanced Smile Design for $838,596. The community has spoken, and the headline should read “Hixson and McMullen Fully Vindicated” so when a future employer or grandchild does a google search, that’s the first headline they will read rather than past headlines accusing them of embezzlement.


Isn’t lying to a Grand jury while under oath considered perjury?......seems that, if true, criminal charges should be brought against Ms Baca...


Ms Mclendon, With all due respect, I think Mr Bladine is correct. I just don't think your explanation could be right. I think if the Nelson's gave false information to a police officer it would be a criminal matter and they would be charged by the DA with a misdemeanor or felony. It would not be the subject of a civil suit. Maybe an attorney could chime in and set us all straight??
I hate to even point this out to you as I don't want to anger you. From the tone of your comments and those of several others on this thread it sounds like their is a lot of hatred and anger and ugly feelings towards the dentist and his wife. I hope you are able to find a way to allow those feelings to disipate and ultimately find peace. Going through life with an angry and spiteful heart is not healthy...even when you are in the right and have just cause to feel that way.


Ms Mclendon, Reading back over your post more carefully, I started to get the distinct impression that you yourself may be an attorney. A quick google search confirmed that you are! I'm not, so I defer to your professional training and expertise and trust that you are indeed correct in your response to Mr Bladine.
Out of curiosity, could you explain why the Nelson's lying to the police and lying to the DA and lying to a grand jury were dealt with as a civil and not a criminal matter?

Jeb Bladine

Clearly, Ms. McClendon and Joel2828, I misspoke in saying it had nothing to do with the criminal charges. Apologies for that. My intent was to say it was not a claim of malicious prosecution by the Yamhill County District Attorney for filing the criminal charges.

It did, in fact, have everything to do with the charges that the Grand Jury issued and the DA pursued ... and which Mr. Nelson then further pursued in the civil case.

I also will bow to Ms. McClendon's legal expertise. It does seem unclear to me whether the malicious prosecution was a product of the original information given to law enforcement, or a product of the continuation of those claims in the civil lawsuit after the criminal charges were dropped. Or, perhaps, the combination of both.

In any event, I believe the story clearly and unequivocally reports civil case jury findings in favor of defendants and in rejection of the plaintiff's claims, including big-money penalties for malicious prosecution. Whatever the debate might be over the headine, It is a story of clear vindication.


Good outcome.

This thing stunk from the beginning.

Kim Faden McClendon

Mr. Bladine, I can clarify for you that the malicious prosecution claim had nothing to do with Dr. Nelson pursuing his civil lawsuit after the criminal charges were brought. The malicious prosecution claim was based solely on the underlying criminal charges. Dr. Nelson and Advanced Smile Design furnished false information to the police and the district attorney. The jury in the civil case found that Advanced Smile Design and Dr. Nelson maliciously initiated the criminal proceedings, and the jury found that Ms. Hixson and Ms. McMullen were actually innocent. I’d also like to clarify that the $800,000 awarded by the jury were not “penalties,” but instead were noneconomic damages that were awarded for the emotional distress these women endured from this malicious prosecution. Part of their distress understandably stems from the publicity of their arrest. To this day, even though they are innocent of all charges, their mug shots appear on the internet as do articles reporting on their arrest. Now that a jury has found they are innocent, I would ask whether out of basic human decency you might remove their mug shots from your website, or perhaps even remove the entire article regarding their arrests. In addition, making this article public rather than only available to subscribers would at least be a way these women could substantiate to the world that they were falsely and maliciously accused and have been completely vindicated in court. Previous articles related to this case are public…why not this one? It seems only fair to give Ms. Hixson and Ms. McMullen the same public forum for positive publicity as they received for negative and demonstrably false publicity.

Jeb Bladine

Ms. McClendon,

The article has been made "public" on our website. All articles in our long-term digital archive are "private" to newspaper subscribers.


This trial was a travesty of justice. The criminal charge was thrown out because the two women paid the state back what they stole. If you have even a half brain in your head you should come to the conclusion that they stole from the dentist too. In my estimation the lawyer for Ms Hixon was a self absorbed egotistical jerk who was on stage for the entire trial. It's lawyers like him that sour me on our legal system. Karma will prevail here and the two women... Not ladies... Will have their judgement day in front of the Lord. Hixons lawyer will be known by me as a shyster. Just my opinion.

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