Ruggerio to submit legislation encouraging settlements should claims be made in pension bankruptcy case
STATE HOUSE – President of the Senate Dominick J. Ruggerio plans to submit legislation tomorrow that would encourage court settlements in the event claims are made as part of the St. Joseph Health Services pension fund bankruptcy case.
The joint tortfeasor legislation encourages parties to enter into a settlement. It provides that defendants entering good faith, judicially-approved settlements would not be liable for claims from co-defendants for contribution or equitable indemnity regarding matters addressed in the settlements. The finality of the settlement without fear of a contribution claim from a co-defendant, provides an incentive to settle.
“I asked my staff to review any and all potential remedies to assist beneficiaries of the St. Joseph Health Services pension fund,” said President Ruggerio. “Should the bankruptcy case evolve to a point where claims may be made, this legislation would provide a proven legal strategy that has been used successfully to encourage settlements in other high profile cases in Rhode Island.”
Similar legislation was enacted in 2014 to induce settlements in the 38 Studios litigation, in 2006 to address the Station Fire litigation, and in 1993 to address the DEPCO litigation. In these three instances, it was found that many of the defendants had insurance policies that included what is known as a “wasting policy,” meaning that liability coverage is reduced as defense costs are incurred. In such cases, it is most beneficial to the aggrieved party that settlements be reached quickly, when more liability coverage is available.
There will not be a committee hearing or vote on the bill during the special legislative session scheduled for tomorrow. Rather, the legislation is being introduced so that the Senate Judiciary Committee can convene at a later date in the fall to conduct its review.
“The beneficiaries of this plan, many of whom are my constituents, worked hard throughout their careers and did everything required of them to earn a secure retirement,” said President Ruggerio. “They deserve better than to have the rug pulled out from under them.”
He continued: “Reportedly, the pension plan was 90 percent funded only a few short years ago. It is extremely troubling that it would slip into receivership so quickly, during a period of economic growth and record financial markets. As the receivership case proceeds, it is a positive development that an attorney such as Max Wistow, who has a proven record of recovering money for victims, has been named special counsel. I know that Mr. Wistow will utilize every legal remedy available to provide relief for the pensioners. Should claims eventually be made in this case, my legislation may provide an important tool to achieve the ultimate goal of making the retirees whole.”
For more information, contact:
Greg Pare, Press Secretary for the Senate
State House Room 314
Providence, RI 02903