Oral arguments in an appeal challenging proposed changes to the Mehlville Fire Protection District’s disability plan were heard last week, but it is undetermined when a three-judge panel will issue a ruling.
Attorney John Goffstein, who is representing Local 1889 of the International Association of Fire Fighters, is appealing a summary judgment handed down in February from St. Louis County Circuit Court Judge Barbara Crancer that dismissed the union’s lawsuit challenging the new disability plan. Goffstein later was able to obtain an injunction prohibiting the enactment of those disability-plan changes, and MFPD’s new plan with Standard Insurance depends on the outcome of his appeal, which was heard Nov. 14 in the Eastern District of the Missouri Court of Appeals by Judges Clifford Ahrens, Nannette Baker and Mary Hoff.
Goffstein contended in court that because the MFPD’s motion for summary judgment addressed only the first two of six counts that Goffstein alleged of fiduciary breach by the MFPD Board of Directors, Crancer’s ruling is incomplete.
However, attorney Paul Slocumb, who, along with attorney Mathew Hoffman, is representing the MFPD, pointed out in court that the fire district’s motion sought relief for all counts filed by Goffstein in the original lawsuit.
In his appeal, Goffstein alleges, among other arguments, that Crancer also “refused to admit plaintiffs’ evidence of fiduciary breach in the form of deposition testimony and affidavits. Therefore, the record before the trial court was incomplete and it was (an) error to enter summary judgment on defendants’ behalf.”
Contrary to Goffstein’s allegation of fiduciary breach and commingling of funds by the Board of Directors, the MFPD attorneys said they have provided the court with an affidavit from the district comptroller after consultation with an auditor, the actual audit and also an affidavit from MFPD board Chairman Aaron Hilmer stating that he is not aware of any commingling.
Goffstein also alleged that the proposed new disability plan will take accrued benefits from fire-district employees and also claimed that the Board of Directors “purchased the policy from third-party cronies.”
Slocumb responded to any uncertainty involving MFPD’s proposed switch to Standard Insurance by saying that the board unanimously decided on the new provider in posted, public meetings.
“We brought in independent brokers who weren’t in the same group,” Slocumb told the court. “They came up with Standard In-surance … It is not a breach of fiduciary duty or bad faith. There is no evidence of that.”
Hilmer told the Call last week that the Standard Insurance proposal does not deprive any employees currently receiving disability benefits and that it would apply only to employees who are disabled when the new disability plan would be enacted.
“If someone is currently receiving a disability check, if they are legitimately entitled to it, they will keep receiving it,” Hilmer said. “But otherwise, we’re going to use the new Standard Insurance policy going forward, which I might add is a better policy. And you ask why? The Standard Insur-ance policy covers people 24/7, 365 days a year. So if you get injured off duty … if you fall off a ladder while you’re cleaning the gutters, you’re covered under this disability policy. Previous? Sorry. You’ve got nothing. So this really is much better.”
But Goffstein said, “All we’re trying to do is protect the constitutional rights of the firefighters and paramedics, the emergency personnel, if you will. (And) to have the fire-district trustees deal with their accrued pension benefits and the amalgaments of their employment in a reasonable and responsible manner without bias or acrimony.
“A good part of the lawsuit is the whole way they went about the means and manner of their decision-making process violated traditional, governmental standards. That’s what the case is all about. That’s about it. The gist of our argument is they must act as fiduciaries, which means they must protect the interest of the planned participants in a responsible and reasonable manner. I mean, that’s why hundreds of people were shouting at them when they took away their disability benefits and replaced them with this Standard Insurance policy without investigating reasonable alternatives. They’ve got a duty to do all that.”
Slocumb told the court last week that he and Hoffman view the case as not so much a question of whether the MFPD has the power to change insurance providers, but how the Board of Directors implemented it. Both the power and the procedure that the board used, Slocumb said, are legal.
“This case was always about process,” he told the court. “The court never questioned the power. We’re the Mehlville Fire Protection District. And by statute, we’re the ones in charge of this (disability) plan.”
Goffstein further contended last week that upon the April 2005 election of Hilmer and Bonnie Stegman to the MFPD Board of Directors, “the directors have expressed an open hostility” to fire-district employees.
In response to Goffstein’s allegation in court of “open hostility” from the MFPD board, Hilmer told the Call, “The only open hostilities I’ve ever been aware of are the well-documented incidents of property destruction, attempts at tortious interference and thuggery displayed by some employees of the district,” Hilmer said.
Goffstein further stated in court that because of the “open hostility” shown by Hilmer and Stegman, he would demand their removal from elected office.
“How in the world can you serve to act in the best interest if you have open hostility?” Goffstein told the court. “We think they need to be removed. And in time, I believe the courts will.”
Hilmer said he is remaining focused and optimistic that the appeals court will reject Goffstein’s appeal and that the new insurance policy will be enacted.
“I am looking forward to an ending of this — when we can finally reveal the depth of the disability black hole that the taxpayers have flushed down all these years,” Hilmer said. “So that’s why I’m looking forward to an ending. So people can really finally see the size of the disability checks they’ve been handing out (and) the lavish retirement benefits they’ve been accruing while on disability. And we can show the public how these people on disability are gainfully employed at other jobs while getting checks from the district. That’s what I’m really looking forward to.”
As for Goffstein’s statement that Hilmer and Stegman should be removed from office, Hilmer doubts that will happen and added that he still has much more work to do for the district in the near future.
“He’d better get Bonnie and I removed quickly,” Hilmer said of Goffstein. “Because there’s some big changes coming to the district soon and some more skeletons to drop out of the closet.”