RI Foundation’s Lawyer Delays Agreement on Preservation of $8.8M in Charitable Assets in St. Joseph
Friday, June 29, 2018
Judge Brian Stern’s courtroom was overflowing with about 100 retirees of the now failed St. Joseph pension fund and more than a dozen attorneys representing a range of parties in the massive pension fund dispute.
Thursday's hearing was thought to be an effort by the special investigator Max Wistow to seek to intervene on the question of the future of now $8.8 million in charitable assets.
As attorneys for the receivership and the now-defunct CharterCare Health Partner’s Foundation were announcing the agreement on how to preserve the assets while the more overarching litigation moves forward, the attorney David Wollin held up the procedures and delayed implementation of the agreement.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTWollin represents the RI Foundation. According to one attorney in the court, Wollin’s objections constituted adding a couple of commas to the agreement.
This is not the first time the RI Foundation delayed proceedings. In February, Del Sesto voiced frustration over the Foundation’s lack of responsiveness in complying with document requests.
SEE AN OVERVIEW OF THE FEDERAL LAWSUIT FILED EARLY THIS MONTH
In February, the Rhode Island Foundation was hit with a subpoena in the investigation.
In 2014, Rhode Island officials approved the sale of CharterCARE to Prospect of California — as part of that deal the pension fund of St. Joseph Health Services was orphaned and left with more than a hundred million in unfunded pension liability and no source of further contributions. Despite the shortfall Attorney General Peter Kilmartin sought and received court approval of the transfer of then-$8.2 million in charitable assets to be transferred to the RI Foundation. The case, for unknown reasons, was never closed.
The subpoena was issued on February 9, 2018, was met with resistance from lawyers for the RI Foundation and receiver Del Sesto voiced frustration at the time by the lack of urgency and the legal machinations of the Foundation’s lawyers.
“There are important issues to be examined. We are looking to see if the dollars that were transferred to the RI Foundation were restricted or non-restricted, and, whether the dollars should have need transferred at all if there was a massive shortfall in the pension system,” said Del Sesto, a partner at the firm Pierce Atwood.
The funds were transferred under the legal doctrine cy pres.
“If it becomes unlawful, impossible or impracticable to carry out the purpose of the designated charitable trust or becomes wasteful to apply all the property to the designated purpose, the trust will not fail but instead the court will direct the application of the property (or a portion of the property) to a charitable purpose that reasonably approximates the designated purpose. The cy pres doctrine means "as near as possible,” writes Cornell School of Law. The charitable donations could not be transferred to Prospect as other assets were in the sale as the California-based company is a for-profit concern.
“While the funds may have been donated with a specific charitable intent, the funds should go to address the creditors of the hospital before the funds were transferred to a third party,” said Del Sesto.
“It is frustrating that the RI Foundation is asking for additional time in order to respond to the subpoena. They should have responded immediately,” added Del Sesto.
“We are not going to leave any stone unturned trying to recover funds for the retirees,” said Del Sesto.
Presently, more than 2,700 members of the plan face a fund that is estimated to be underfunded by $118 million.
Related Slideshow: 10 Shocking Elements of the St. Joseph Pension Fund Lawsuit Against the Diocese and Others
Related Articles
- Coming Monday - INVESTIGATION: The Real Cost of the St. Joseph Pension Fund Collapse
- Diocese, Kilmartin’s Legal Delays Are Increasing Costs to Recover Monies For St. Joseph Pension
- INVESTIGATION: Diocese Underfunded St. Joseph Pension Fund by $100 Million
- Key Trust Document Shows Bishop of Providence Has Oversight of Failed St. Joseph Pension Fund
- LIVE: Whitcomb on Al Franken’s Demise, St. Joseph’s Pension Debacle, and More
- Judge Slams Kilmartin for Delaying Release of Documents in St. Joseph Pension Fund Collapse
- Diocese Fights to Quash Subpoena for St. Joseph Pension Fund, Wistow Fires Back
- Former U.S. Attorney Says Hospital Conversion Act Needs Review to Avoid Another St. Joseph’s
- St. Joseph Pensioner Quinn Worked 34-Years and Now Facing Cuts to Her $500 a Month Payment
- Callaci: Memorial Hospital’s Closure & St. Joseph Pension Failure Show State of Healthcare
- Kilmartin Tries to Block Release of Records in St. Joseph Pension Fund Collapse
- Kilmartin Knew of St. Joseph’s Pension Collapse 10 Days Before Failure
- Judge Stern Shoots Down Prospect and Attorney General in St. Joseph Pension Fund Collapse
- UNAP Issues Statement Following Lawsuit Filed in St. Joseph’s Pension Collapse
- Massive Lawsuits: Lawyers for Failed St. Joseph Pension Fund Sue Catholic Church and CharterCare
- 10 Shocking Elements of the St. Joseph Pension Fund Lawsuit Against the Diocese and Others
- 900K+ Documents Reviewed in Filing Lawsuits, Says St. Joseph Pension Fund Receiver Del Sesto on LIVE
- St. Joseph Pension Plan, UHIP Progress & More: This Week at the State House
- Senate Passes Bill Encouraging Settlements in St. Joseph Pension Fund Collapse
- DelSesto, Receiver for Failed St. Joseph Pension Fund, Unveils Next Steps in Investigation
- 6 Months After The Biggest Pension Collapse in RI - What is the Status of St. Joseph’s Fund?
- Subpoena Issued to RI Foundation on $8.2M Questionable Gift Tied to St. Joseph Pension Fund Collapse
- Feds Issue Subpoenas on St. Joseph Pension Fund Collapse
- Raimondo Signs Bills to Help Settle Lawsuits in St. Joseph’s Pension Collapse