Bill Would Stop St. Joseph Pension Plan Settlements from Absolving Other Potentially Responsible Parties

STATE HOUSE – House Majority Leader K. Joseph Shekarchi (D-Dist. 23, Warwick) has introduced legislation to help the members of the St. Joseph’s Health Services pension plan by not allowing a settlement with one responsible party, or “tortfeasor”, to absolve the other responsible parties of the responsibility of an equitable settlement.

The bill (2018-H 8166) would better position the members of the insolvent plan to reach fair, equitable settlements with multiple defendants, which is a possible outcome of the pension plan case, according to a release from the Legislative Press and Information Bureau.

The bill reads, in part, “A release by a claimant of one joint tortfeasor, whether before or after judgment, does not discharge the other joint tortfeasors unless the release so provides, but such release shall  reduce the claim against the other joint tortfeasors in the amount of the consideration paid for the release.”

The $85 million St. Joseph pension plan covers about 2,700 current and former employees of Our Lady of Fatima and Roger Williams hospitals, but was left insolvent when contributions to it ceased following the sale of Fatima and Roger Williams to Prospect Medical Holdings in 2014.

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 litigation stemming from the Rhode Island Share and Deposit Indemnity Corporation (RISDIC) credit union collapse.

“Whatever happens with the litigation, all of Rhode Island wants to see the fairest possible settlements for the thousands of people whose retirement has been thrown into chaos by the pension fund’s insolvency. This legislation will help ensure that they are able to pursue every avenue for restitution that is available to them, and reach equitable settlements,” said Shekarchi.

Shekarchi introduced the legislation at the request of attorneys Max Wistow, who is special counsel in the case, and former attorney general Arlene Violet, who is serving as co-counsel. Wistow also helped recover millions in taxpayer dollars in the 38 Studios case.

The bill, which has been assigned to the House Health, Education and Welfare Committee, is cosponsored by House Speaker Nicholas A. Mattiello (D-Dist. 15, Cranston), Rep. Scott A. Slater (D-Dist. 10, Providence), Rep. Joseph M. McNamara (D-Dist. 19, Warwick, Cranston) and Rep. Mia A. Ackerman (D-Dist. 45, Cumberland, Lincoln). Identical legislation (2018-S 2112) has been introduced in the Senate by Senate President Dominick J. Ruggerio (D-Dist. 4, North Providence, Providence).