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Ruggerio introduces bill to encourage Fatima pension plan settlements

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PROVIDENCE, R.I. (WPRI) – Senate President Dominick Ruggerio said Monday he is introducing legislation designed to ease the way for legal settlements if a lawsuit is filed over the insolvent Fatima Hospital pension plan.

Fatima retirees are facing benefit cuts of up to 40% after their pension plan was effectively left orphaned by a 2014 takeover deal that transferred ownership of the hospital. Fatima’s current and former owners have said they have no legal responsibility to make the pensioners whole.

Ruggerio, a Democrat whose North Providence district includes Fatima, said his so-called “joint tortfeasor” bill would encourage settlements if retirees file suit over the pension plan. The Senate Judiciary Committee will review the bill later in the fall.

“I asked my staff to review any and all potential remedies to assist beneficiaries of the St. Joseph Health Services pension fund,” Ruggerio said in a statement, referring to Fatima’s former parent company. “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.”

Ruggerio said similar bills were filed in three previous cases – the 38 Studios civil lawsuit, the Station nightclub fire litigation, and after the credit union crisis. 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,” according to a Senate summary.

Max Wistow, a high-profile local attorney who was involved in the 38 Studios and Station lawsuits, was recently hired as special counsel by the receiver for the Fatima pension plan to review what if any legal options the retirees have.

“I know that Mr. Wistow will utilize every legal remedy available to provide relief for the pensioners,” Ruggerio said.

The Fatima pension plan dates back to the 1960s and was run for most of its existence by the Roman Catholic Diocese of Providence, which controlled the hospital through a parent company, St. Joseph’s Health Services, until its 2009 merger with Roger Williams Medical Center under the umbrella of a new organization, CharterCARE. A second merger, in 2014, saw CharterCARE taken over by Prospect Medical Holdings, a for-profit company based in California.

In an interview last week with the diocesan newspaper, Providence Bishop Thomas Tobin insisted the Catholic diocese has no obligation to bail out the pension plan, though he said he was “praying truly that this comes to a very positive solution for them.”

“The only entity that can improve the condition of the pension funds now is Prospect Medical Holdings,” Tobin said. “They’re a billion-dollar for-profit corporation.”

The diocese has not entirely severed ties with the pension plan, however. One of Tobin’s top deputies, Chancellor Timothy Reilly, is still on the board of St. Joseph’s, the entity that has retained oversight of the plan since 2014.Ted Nesi (tnesi@wpri.com) covers politics and the economy for WPRI.com. He writes Nesi’s Notes on Saturdays and hosts Executive Suite. Follow him on Twitter and Facebook

Copyright 2019 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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