St. Joseph Receiver Del Sesto to Meet with Raimondo, Ruggerio Proposes Bill
Tuesday, September 19, 2017
On Wednesday, the receiver in St. Joseph Health Services pension fund Stephen Del Sesto is scheduled to meet with Governor Gina Raimondo to brief her on the case.
Del Sesto, a partner at Pierce Atwood, was appointed by the court as the temporary receive in mid-August by Superior Court Michael Silverstein. Since the initial filing, the case has been assigned to Judge Brian Stern.
Nearly 3,000 members of the St. Joseph pension face a 40 percent cut to retirement payments as a result of the bankruptcy filing in August. Judge Stern at a recent hearing allowed for full payments to continue until February 1, 2018, but the fate of the underfunded pension fund presently is much in doubt.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTOn Monday, President of the Senate Dominick Ruggerio announced he plans to submit legislation Tuesday that “would encourage court settlements in the event claims are made as part of the St. Joseph Health Services pension fund bankruptcy case.”
Del Sesto was unaware the Ruggerio was submitting the legislation.
“I became aware of this today via the press release from the Senate President,” said Del Sesto.
“Regarding the legislation, it is similar to the legislation passed in prior high-profile, sensitive matters (i.e. RISDC, Station Nightclub, 38 Studios). In each of those matters this kind of legislation was extremely helpful to encourage and facilitate piecemeal settlements,” said Del Sesto, “Similarly here, there are several parties that potential have liability. If this legislation will help to foster settlement of potential claims that may be asserted by me on behalf of the Estate and the pension participants, then I support the Senate President’s efforts.”
Greg Pare, the press spokesman for Ruggerio told GoLocal, "The Senate President’s attorney did reach out to Max Wistow to inquire whether this legislation would be appropriate should any claims be filed." Wistow was appointed a special investigative counsel by Stern to assist in identifying the issues tied to the pension funds' failure. Wistow recovered $61 million in the 38 Studios bankruptcy case.
Ruggerio's Bill
Ruggerio’s 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,” claimed Ruggerio’s office in a press release.
“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.”
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.”
The next scheduled formal event in the St. Joseph fiasco is an October 11 hearing before Judge Stern.
Related Slideshow: 10 Things to Know About One of Biggest Pension Failures in RI - St. Joseph Receivership
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