Judge refuses to step aside on pensions

PROVIDENCE, R.I. (WPRI) - R.I. Superior Court Judge Sarah Taft-Carter on Friday again refused to step aside and stop hearing a union lawsuit challenging last year's pension law, dismissing the state's argument that too many of her family members are part of the pension system for her to be impartial.

Speaking from the bench, Taft-Carter described some of the state's arguments as "misleading and a misstatement of the law," and pledged that she would be "fair and impartial in hearing and deciding these cases." Taft-Carter's mother, son and uncle are all part of the state pension system, as is she.

"She's going to be our judge," said John Tarantino, the state's lead counsel, who took pains to say his argument that Taft-Carter should step aside was not meant as an attack on her personally. "I'm very comfortable in arguing our case in front of her." He added, "I don't believe that the state is in real trouble."

"Everything that went on today is actually what we expected," Carly Iafrate, a lawyer for the retirees, told reporters.

During a two-hour hearing at the Licht Judicial Complex in Providence, Taft-Carter also heard lawyers' arguments about the state's motion to dismiss the entire case. The judge declined to make a ruling on the motion Friday and said she will provide her decision to the lawyers later.

Nesi's Notes: In-depth pension coverage Q&A: Why Al Gore's lawyer took pension case

Taft-Carter said nothing about whether she has asked the two sides to begin negotiating a potential settlement, which has become a heated disagreement this week between Gov. Lincoln Chafee, who signed the law and wants to negotiate with the unions, and Treasurer Gina Raimondo, who designed it and opposes talks.

"She raised the issue with us," Iafrate said when asked about whether Taft-Carter has instructed the two sides to begin negotiations or search for a mediator. Tarantino refused to comment when asked about negotiations.

The stakes are high for Rhode Island taxpayers and the roughly 66,000 individuals in the pension system.

The state and its municipalities are banking on the law being upheld, which will shave their pension obligations by more than $3 billion. Retirees are facing years without an annual increase in their pensions under the law, which also moved current workers in July to a new system that pairs a smaller pension with a 401k-style benefit.

The fight over pensions in Rhode Island is getting attention across the country as other state and local governments consider changes to the retirement benefits that in many cases they promised their workers years ago without setting aside enough funding.

Most of Friday's courtroom action concerned the state's argument that Taft-Carter should dismiss the state altogether because workers and retirees have no contractual right to their pension benefits, a question at the heart of the case. Taft-Carter previously ruled on the issue in the unions' favor in September 2011.

Tarantino said the judge should defer to state lawmakers in their decision to change the pension system and shouldn't say a law is also a contract if they didn't specifically write that into the statute. Legislators "must be able to change with the times, the moods and the like, assuming what they do is legal," he said.

Iafrate argued Taft-Carter had been correct in her ruling last year that there is an "implied contract" between workers and the state to get their pension benefits, and that the new law breaks that implied contract. "You set up this statutory scheme to pay people, and now you have to pay them," she said.

Taft-Carter on Friday also agreed to allow David Boies, the prominent New York city lawyer, to practice law in Rhode Island and join the state's legal team. Boies was in the courtroom for the hearing after giving an extended interview about the case to WPRI.com on Thursday.

Iafrate said she expects Taft-Carter to rule on the motion to dismiss the suit within 30 days. Asked how long the entire lawsuit could take to litigate, Tarantino said it would be a minimum of months. Iafrate said the biggest dispute will be over whether the state had a necessary public purpose for reducing pension benefits.

The judge scheduled a pre-trial conference with lawyers on both sides for Dec. 18 at 9:30 a.m.

Ted Nesi ( tnesi@wpri.com ) covers politics and the economy for WPRI.com and writes the Nesi's Notes blog. Follow him on Twitter: @tednesi

Tim White contributed to this report.

Copyright 2014 WPRI TV. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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Rhode Island (change)

Gov. Lincoln Chafee, the first independent in his position, has his work cut out for him: fix the state's finances and help 66,000 unemployed Rhode Islanders get back to work.
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Governor: Lincoln Chafee
Lieutenant Governor: Elizabeth Roberts
Attorney General: Peter Kilmartin
State Treasurer: Gina Raimondo
Secretary of State: Ralph Mollis

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