A Fulton County Superior Court judge has denied a request by Atlanta employees for a retrial in their bid to overturn Mayor Kasim Reed’s pension reform.
The denial comes as attorneys for the city demand the employees’ lawyers pay $436,000 in legal fees over what they say is a “frivolous lawsuit.”
The employees lost their initial class-action lawsuit last fall, and the Georgia Supreme Court is still considering their appeal of Superior Court Judge John Goger's decision.
The same group filed a motion earlier this month to have their case reconsidered based on new evidence: a 2009 letter from former Atlanta Mayor Shirley Franklin to then-Atlanta City Council President Lisa Borders regarding the city’s pension problem.
According to the memo, Franklin told Borders: “As you will recall from previous discussions on pensions, the City cannot legally decrease the benefits provide [sic] to current City employees.”
Attorneys for the workers say Franklin’s stance directly contradicts Reed’s position that the city acted lawfully when it increased current employees’ pension contributions in recent years.
On February 17, Goger ruled against the employees’ request for retrial for a number of reasons, including his determination that the plaintiffs’ attorneys should have discovered the letter soon. Goger also wrote in his opinion that the new evidence would not have led to a different outcome.
The legal case began in November 2013, when a handful of employees representing nearly 6,000 Atlanta fire, police and general workers sued the city, saying Reed's decision to force employees to pay 5 percent more toward their retirement benefits was in violation of their contract and, therefore, unconstitutional.
Such an increase, Augusta-based attorneys John Bell and Lee Brigham argued, must also increase their pension benefits.
Reed and city attorneys — led by Senior Assistant City Attorney Robin Shahar — successfully countered that the pension contribution increase is allowed under Georgia law.
The mayor has long said overhauling the employee retirement benefits program was critical to the city’s financial stability and will help Atlanta pay off a $1.5 billion unfunded pension liability.
Reed has argued that, without increasing contributions, the city can’t afford to pay the full benefits eventually owed to workers. And that could have led the city into default.
Goger sided with the city in November. Had Goger favored the employees, the move would have effectively reversed Reed’s pension change, leaving Atlanta on the hook for about $36 million in restitution. According to court filings, Atlanta anticipates that losing the legal challenge would cost the city $160 million in prospective savings over the next 30 years.
Atlanta’s attorneys filed for partial reimbursement of legal fees in December, Reed spokeswoman Anne Torres said, because the administration doesn’t believe taxpayers should be on the hook for “this frivolous lawsuit.”
Atlanta is asking for $400,000 in attorney fees and $35,600 in litigation expenses.
Though Atlanta’s attorneys are paid an average wage of $49 per hour, they calculated the fee based on comparable salaries for lawyers working in private practice, ranging from $150 to $540 per hour.
Bell said the reimbursement claim levied against him is the first in his more than 40 years practicing law. He refuted the assertion the lawsuit was without merit.
“I think it’s in poor taste,” he said. “Everybody has got a right to do it if they want to, and these city lawyers are very good and it’s probably their client telling them to do it.”
Goger is waiting on the Supreme Court decision before ruling on the legal fee issue, according to Torres. A date for that hearing has not yet been scheduled.
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