We Have A Contract for COLA!!!

October 13, 2012

The Colorado Court of Appeals ruled Thursday that PERA retirees have a contract with PERA that includes their annual benefit increases (aka COLA.) The unanimous court wrote:

We agree with plaintiffs, subject to certain limitations explained below. Specifically, we conclude that plaintiffs have a contractual right, but that the court must still determine whether any impairment of the right is substantial and, if so, whether the reduction was reasonable and necessary to serve a significant and legitimate public purpose. Therefore, we reverse the summary judgment and remand the case to the district court for further proceedings. You may read the 37 page decision at this link:


Plaintiffs will now confer with their attorneys as to how to proceed in the case. While we have won a significant battle, we expect PERA and Colorado to now vigorously defend their claim that there was “actuarial necessity” for reducing the COLA.

Thank you to the hundreds of donors to Save PERA COLA’s legal fees. We could not have gotten this far without you. We have far to go. If you can, please send another check. Visit our website at
www.SavePERACOLA.com/support .

Oral arguments heard by Colorado Court of Appeals

September 7, 2012

On Tuesday, September 4,  the Colorado Court of Appeals (Division IV) heard plaintiffs’ appeal of the Denver District Court’s  decision that  granted a Summary Judgment  which  dismissed Justus et al  v. State of Colorado and PERA et al.  Richard Rosenblatt presented oral arguments on behalf of Justus et al.  Sean Connelly, a partner in the Reilly Pozner law firm (and a former member of the Colorado Court of Appeals from 2008-2011) presented for the State of Colorado and PERA et al.  Judges were Dennis Graham, Diana Terry and Jerry N. Jones. The link to the audio transcript of the arguments, approximately 45 minutes in length, is below:
http://www.courts.state.co.us/Courts/Court_Of_Appeals/Oral_Arguments/Index.cfm  Upon reaching this page, click on Justus v. State of Colo in the September 4 box.
Each judge posed questions to the attorneys . It’s suggested that you turn down the bass on your speakers to enhance audio quality.
A decision by the Court will be issued in due course, date unknown

Appellants’ Reply Brief Filed

June 26, 2012

On June 15 Attorneys for the Plaintiffs in Gary R. Justus et al v. State of Colorado et al filed the final Reply Brief with the Colorado Court of Appeals. It will be considered by a three judge panel. This may take most of the summer, we anticipate. The brief very directly raises and addresses the essential question of ‘how can a government fairly impair a contract to which it is a party?’

“The fact that the contractual obligations of the government, rather than a private party, are at issue is significant. The Supreme Court has noted that under the federal Contracts Clause “impairments of a state’s own would face more stringent examination … than would laws regulating contractual relationships between private parties,” citing Allied Structural Steel Co.v. Spannaus, 438 U.S. 234, 244 n.15, 98 S.Ct. 2716, 57 L.Ed.2d 727(1978). (Page 11 of brief)

This is interesting reading and should serve to reinforce the validity of our case in anyone’s mind. View it here:  2012-06-15 Appellants’ Reply Brief

Your donations are needed and welcomed to continue the legal work in this case, either in the District Court or the Colorado Supreme Court. Have you done your part? Click on www.SavePERACOLA.com/Support to contribute.

State and PERA File Appellees’ Briefs

May 23, 2012

New on the Resources page www.SavePERACOLA.com/resources are the two answers that PERA and the State of Colorado have filed with the Colorado Court of Appeals. These are in response to our appeal of Denver District Court’s dismissal of our lawsuit over the reduction in our annual 3.5% cost-of-living adjustments brought about by Senate Bill 10-001 in February of 2010. There is little new here that they have not claimed previously, except mention of the dismissal of two similar lawsuits that were filed in South Dakota and Minnesota. They do not cite numerous other lawsuits across the nation where retirees and active pension members have recently won.

Our attorneys are now preparing appellants’ answer to these two briefs, which are due to the court June 12. We are optimistic that the Court of Appeals will send the lawsuit back to the trial court for action with direction of the constitutionality of our claims.

Court of Appeals Schedule

April 25, 2012

We have received notice of the following scheduled dates for the lawsuit:

4/23/12 – Appellees  to Supplement Record

5/29/12 – Appellee’s Answering Brief

6/12/12 – Appellant’s Reply Brief

PERA and the State of Colorado are the appellees. Gary R. Justus et al are the appellants.

More PERA Cuts?…or…Win the Lawsuit!

April 25, 2012

The attack on PERA retirees’ annual benefit increases is starting up again, this time by Governor John Hickenlooper. We are again seeking to raise additional funds to support our legal efforts in overturning in state court the serious reductions in those increases that Senate Bill 10-001 created two years ago.  We would like to take this opportunity to talk about the importance of winning this case for the economic well-being of current and future retirees, and to talk about the way in which we need to go about fund-raising and consciousness-raising.  Most importantly, we want you to understand the direction that the governor appears headed.  The governor’s comments illustrate quite clearly how precarious PERA’s promises about our pensions are.


For those of you who didn’t see it, you should read the account, published in the Pueblo Chieftain, of Governor Hickenlooper’s comments about pension issues.  http://www.chieftain.com/hickenlooper-talks-energy-water-pensions/article_25f92ef8-4ef1-11e1-a99f-001871e3ce6c.html



The Governor stated that SB1 did not go far enough in cutting retiree benefits and that he supports further cuts, specifically further reductions in the annual increases!  This is exactly the scenario that we predicted in our last communication to you.


PERA cannot interpose any legal objection to such a proposal: Its court filings in our lawsuit assert that there are no contractual rights to the annual increase.  The Governor is merely moving further down a road already paved by PERA.  The governor is also taking PERA’s lead in proposing a 5-year Highest Average Salary for current employees and increasing the retirement age again.  The HAS change was part of the original Senate Bill 1 that did not make it into law as passed.


Curiously, PERA has rediscovered contractual rights in their opposition to some legislation (far less damaging to pension rights than SB1 was) introduced this session but has not retracted what it stated in its legal briefs. Nor has it, to our knowledge, said anything publicly about the governor’s proposal.  By placing our retirement benefits outside the constitutional firewall, PERA has enabled proposals like this as well as the other negative legislation introduced this session.  It then piously opposes some of this legislation – even though it was inspired by its own actions.


PERA could oppose the governor’s proposal on the grounds that it is unnecessary since the actuaries have estimated that PERA will be 100% funded within the 30-year period.  However, it is now well within the power of the legislature and the governor to overcome this objection.  How?  They can simply refuse to provide the amount of funding necessary, or change the investment assumptions, or increase the required funding percentage again, or just wait until the next market downturn and there will be an unfunded liability once again.  Having created a new and severe funding problem, they will again demand that the problem be “fixed” by cutting benefits.  PERA has acquiesced to actions like this in the past, so it we should not expect it to resist in the future.


We believe that this provides additional evidence that Colorado no longer considers its defined benefit (DB) pension plan to be a contract with PERA members, and instead considers it to be a “gratuity” (GP) to be paid only when politically expedient. We also believe that it supports the notion that PERA is not an effective advocate for those whose money they have taken for many years.  It is PERA itself that has put us on this slippery slope.  Take a few minutes and read its legal brief where it asserts that it had no contract with us to provide the promised benefits.

https://saveperacola.files.wordpress.com/2011/06/2011-05-06-pera-defendants_-reply-in-support-of-summary-judgment.pdf    (See p18)

The need for prevailing in the lawsuit has never been clearer though we suspect it will continue to get clearer yet as proposals like the governor’s gain traction.  Given all this we believe that different options should be considered like a Social Security hybrid plan.  This would at least provide for real COLAs for that portion of the benefit and would eliminate the Social Security offset for those PERA members who have Social Security from other employment. 


Many public sector unions have strongly opposed attempts to roll back pension benefits, especially for the already retired, but some have not.   As far as we know the national organizations with which the Colorado unions are associated are all defenders of pension rights.  We would ask those of you who are present or former public sector union members to encourage your unions to support the efforts of SavePERACOLA and other similar organizations.


In order to raise funds for the appeal and to create understanding for the struggles to come, we are asking for your help.  We are up against an organization with

1) $40 billion of our money;

2) the willingness to spend as much as they need to in legal and lobbying expenses to prevail and;

3) the support of the political establishment in both parties


Other than minimal expenses for operating expenses (tax filings, purchase of contact lists and the like) all the funds raised thus far have gone to the attorneys to help cover their out of pocket expenses in what promises to be a lengthy legal process.  No person associated with SavePERACOLA receives any kind of salary or stipend.


We welcome additional contributions from our traditional supporters such as you, but we also need to broaden our support base.  To this end, we would request that each of you use your personal, email and social networking contacts to recruit additional supporters.  In this way, we can broaden our base and avoid asking for ever more money from retirees whose income is already at risk.


Please, make a donation today to Save PERA COLA and we will forward it to our law firm to meet our commitment to them. We are well over half way to our goal and want to reach it soon in conjunction with the expected ruling this year by the Colorado Court of Appeals.


Remember, the bottom line here is that unless we prevail in this lawsuit, the PERA is off the hook for keeping the promises it made to every member and retiree.   It will excuse itself again of any benefits it believes it cannot afford. There is nothing legally that you or I will be able to do about Governor Hickenlooper’s most recent proposals —unless we win in court. Are you with us?


Thank you for your continued support.


Dismissal of Lawsuit Appealed

July 25, 2011

PERA Retirees Appeal Dismissal of COLA Class Action Lawsuit

The plaintiffs in the civil suit Gary R. Justus et al vs. State of Colorado and Public Employees’ Retirement Association of Colorado et al (Case No.: 2010CV1589) have announced that they will appeal today the June 29th dismissal of their case by Denver District Chief Judge Robert S. Hyatt. The plaintiffs are PERA retirees Gary R. Justus, Kathleen Hopkins, Eugene Halaas and Robert P. Laird. The suit challenged the 2010 action by the Colorado Legislature (Senate Bill 10-001) that eliminated for 2010 the annual benefit increases for retirees (and those eligible to retire) which had been fixed at 3.5% per year (3.25% for Denver School Division), and reduced the increases in future years so that they could be as little as 0% and no more than 2.0%.

In his decision granting defendants their Motion for Summary Judgment, Judge Hyatt distinguished between “a retiree’s contractual right to the base PERA retirement plan benefits” and “a contractual right to a specific or particular COLA.” Hyatt wrote that “there is no contract right to a specific COLA formula frozen at retirement for life.” Hyatt’s ruling effectively permits the legislature to make changes in the COLA at anytime, even reducing it to zero.

Plaintiffs will appeal based on their original claims that settled law by the Colorado Supreme Court clearly determined that COLA is part of a retiree’s contractual right and cannot be reduced. The two major cases plaintiffs cited in this case are:

Police Pension and Relief Bd. of City and County of Denver v. Bills, 148 Colo. 383 (1961)

Police Pension and Relief Bd. of City and County of Denver v. McPhail, 139 Colo. 330 (1959)

Justus explained why this case must go forward. “SB10-001 endangers the economic well being of close to 100,000 retirees.. If this decision stands, then whenever Colorado wants to renege on a contract again, it can now just pass a law changing the terms of that contract. Yet, we can’t renege on our retirements and go back to work for our public employers to make up the difference. Anyone who believes that PERA has secured our vested pension rights is sadly mistaken. PERA is just an instrumentality of the state. If we don’t stop it here, it’s open season on public employees,” he said.

Plaintiffs are represented by Richard Rosenblatt & Associates of Greenwood Village and the Pittsburgh, PA law firm of Stember Feinstein Doyle & Payne.

For more information, visit the website http://www.SavePERACOLA.com where the court filings and numerous comments by retirees may be found. Save PERA COLA is a non-profit Colorado 501(c)4 corporation that supports the lawsuit. Richard H. Allen is president.