Sen. Pete Reyes (Ind-Saipan) and Senate Vice President Victor Hocog (R-Rota) yesterday called on retirees to opt out of the tentatively approved NMI Retirement Fund settlement agreement, describing the lawyers for plaintiff Betty Johnson as “sharks,” “bloodsuckers,” “vampires” and “ambulance chasers” for their attorneys’ fees and costs of some $36 million.
“It’s just insane,” Reyes said at yesterday’s Senate session.
Reyes said the Fund would be bankrupt much faster than expected, and instead of these millions of dollars helping the retirees, they would instead go to lawyers.
He called on the Senate leadership to meet with the governor to discuss this, and at the same time asked whether legislation or petition could be drafted to dissuade members from opting out of the settlement deal “if that’s the only way to protect retirees.”
Gov. Eloy S. Inos said in a brief interview that he would like the court to give the government a chance to comment and take a position on the attorneys’ fees and costs submitted to the court.
Inos said he’s surprised by the amount.
“Our position is that any attorney’s fees have to be paid outside of the Retirement Fund. It can’t be paid within the Fund. We’re challenged with having to find money from the Fund,” Inos told Saipan Tribune.
House Speaker Joseph Deleon Guerrero (Ind-Saipan) said he agrees with the sentiments of other lawmakers that the attorneys’ fees and costs are “exorbitant” and “ridiculously high” but he said making this a reason to encourage retirees to opt out of the settlement is a “scary” proposition.
The speaker said attorneys’ fees and costs would have to be paid eventually, but he’s hoping the court would approve an amount that is “appropriate.”
“If many of the members opt out and the settlement fails, then we will be back to where we started. The Fund and the government can be sued again, and lawyers have to be hired again. And they will also ask for payment. Right now, it’s up to the judge to decide what the appropriate amount would be,” the speaker told Saipan Tribune.
He hopes that lawmakers would exercise restraint before making any accusations at this time.
Senators sought yesterday a joint meeting with the House as well as the governor to discuss the attorneys’ fees and costs and their impact on the settlement agreement.
Hocog said it makes him wonder why retirees’ pensions have to be cut by up to 25 percent. He hopes that this was not because the 25 percent cut or deferred payment was from the start meant to go to lawyers’ fees and costs.
“It caught us by surprise,” Hocog later said, adding that it’s good this came out days before the Sept. 20 hearing.
During a Senate session yesterday afternoon, senators took turns bashing Johnson’s lawyers for attorneys’ fees and costs they described as “insane,” “unreal,” and “ridiculous,” among other things.
Reyes said Johnson’s lawyers are “sharks attacking the Retirement Fund.”
“There has to be a limit how far these [costs] could go,” he said.
Hocog said the same lawyers are “vampires” and “blood suckers” for trying to dry out the Fund. He also said they “cannibalize” the Fund.
“I ask all my families who are retirees to opt out of this class action suit. It’s a good thing that Sept. 20 is the deadline,” he said.
Senate floor leader Ray Yumul (Ind-Saipan) said he thought the lawyers were demanding too much.
“They waited until everything is locked and in place… Here we are looking for funds for the retirees. All this time, there they are. In just a few years, we will be back to where we started. We need to meet with the House to save the Retirement Fund. If that calls for opting out so be it,” he said, adding that over $30 million in attorneys’ fees and costs is “unreal.”
Yumul said the government—which is expected to foot Johnson’s attorneys’ fees and costs—is already faced with the daunting task of finding money to pay into the settlement fund, the deferred 25 percent pension and other obligations yet “here we are picking up another tab.”
Sens. Jovita Taimanao (Ind-Rota) and Frank Cruz (R-Tinian) echoed their colleagues’ sentiments.
Senate President Ralph Torres (R-Saipan) said the issue is not the settlement agreement itself, but the attorneys’ fees and costs that he says are unreasonable.
“We will work hand in hand with the administration on this,” he said.
Press secretary Angel Demapan said the administration has “serious concerns on the legal fees filed by the Johnson attorneys involved in the settlement agreement.”
“However, the governor intends to meet with the government’s legal team before making any further comment. As for the concerns of lawmakers, the governor also intends to discuss these matters with them as the government prepares drawing up its response and concerns in the coming days,” Demapan added.
Rep. Janet Maratita (Ind-Saipan) said from the start, she has not supported the Fund settlement agreement.
Rep. Mario Taitano (Ind-Saipan), chairman of the House Special Committee on Retirement Fund, said the proposed attorneys’ fees and costs were high, but he said opting out is not the solution to the issue at hand. He also seeks joint meeting of the Legislature and the governor on the matter.