Morrison & Foerster Secures Appellate Victory for the Association of Orange County Deputy Sheriffs

01/28/2011

Miriam A. Vogel, James P. Bennett, and Tritia M. Murata

Press Release

LOS ANGELES (January 28, 2011) – Morrison & Foerster secured a major appellate victory for the Association of Orange County Deputy Sheriffs (AOCDS) in a lawsuit brought by the County of Orange that threatened the pension benefits of AOCDS’ members and implicated similar public employee pension benefits throughout the state. The County’s 2008 lawsuit challenged a statutorily-authorized, pension benefit formula (3% at 50) unanimously approved by the Board of Supervisors in 2001, alleging that (to the extent the formula considered prior service) it (1) violated the California Constitution’s debt limitation provision and (2) amounted to unconstitutional extra compensation for work previously performed.

On January 26, 2011, Division One of the Second Appellate District affirmed the trial court’s judgment in favor of AOCDS.

The Court of Appeal rejected the County’s debt limitation challenge, holding that the actuarial projection used to estimate the County’s future funding obligations to the Orange County Employees Retirement System was not a “liability” within the meaning of the debt limitation provision. As the Court explained, the actuarial estimate did no more than project the impact of a change in a benefit plan, and it was not a legally enforceable obligation measured at the time of the County‘s 2001 resolution approving the 3% at 50 formula.

The Court likewise rejected the County’s claim that the improved formula provided prohibited “extra compensation” to the deputies, holding that “AOCDS members’ contractual pension expectations include not only those benefits in effect when they accepted employment, but also those conferred during their tenure.” The Court explained that “the 3% at 50 enhancement did not provide AOCDS members with additional compensation while they worked for the County,” and that it would become part of the calculation of their pension benefits only upon retirement.

As the Court of Appeal noted, the County ignored the fact that credit for prior service has been a fundamental part of public service employees’ pension benefits for at least 97 years, and similarly “ignore[d] the obvious implications” of its claims on the many other “statutes which allow increased pension benefits for state employees to be applied to prior years of service.”

Morrison & Foerster Senior Of Counsel Miriam Vogel argued the appeal. The team also included Senior Of Counsel Joseph L. Wyatt, Jr., partner James Bennett, and associate Tritia Murata.

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