AFSCME slaps city with $125K legal bill

An agreement has been reached regarding attorney compensation in a lawsuit filed by Local 2957 of the American Federation of State, County and Municipal Employees against the city of Benton (AR), members of the 2003 City Council and Mayor Rick Holland.

The city lost the suit and subsequent appeals, but will not be responsible for the lawyers’ fees, City Attorney Brent Houston said. “This payment is not coming from city coffers,” Houston said. The money is coming from the Central Arkansas Risk Management Association, which essentially is the city’s liability carrier.

According to an e-mail from CARMA attorney David Fuqua, the AFSCME attorneys, James E. Nickels and Pamela Walker, have agreed to a payment of $125,000 plus out-of-pocket costs.

An e-mail from Walker stated that she and Nickels are agreeing to “waive the interest ordered on the judgment for costs.”

The suit stemmed from the City Council’s decision to discontinue paying retiree insurance which had been agreed to in a union contract and which had been the city’s ongoing practice for many years.

The 2003 council, during a budgetary crisis, decided to cut the number of vacation days and to eliminate the retiree insurance benefit.

“The only money the city has been out on this lawsuit occurred early on when the city was represented by the Arkansas Municipal League,” Houston said. “The city paid the Municipal League $3,000 for our defense. After that CARMA took over representation and once that occurred, the city wasn’t out any more attorney fees.”

The Eighth Circuit Court of Appeals in St. Louis recently rejected the city’s latest appeal of the suit, which was filed by 29 members of the AFSCME local and three retired employees. The recent decision marked the third time a court has ruled against the city.

A settlement was made with the three retired employees toward the end of 2006, Houston said.

“No payment will have to be made now with the plaintiffs, because no one has retired,” Houston said. “Wheb they retire, the city will have topay the benefits.”

The three plaintiffs who have retired were paid the present value of what the benefit was believed to have cost,” Houston said.

Houston and Fuqua have contacted Little Rock attorney Robert Newcomb in regard to a second suit filed by retired police detective Dan Garner and others to attempt to settle that suit.

The issue was discussed briefly in a City Council meeting Monday night, but no decisions were made regarding payment to these plaintiffs.


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