UI benefits lawsuit revived

MOSCOW, Idaho – A judge agreed Monday to reconsider a decision last month to throw out a lawsuit brought by 268 former University of Idaho employees who claimed their early retirement benefits were unfairly reduced.

But Second District Judge John Stegner warned both sides not to expect a lot of changes, adding that the case is “going up and will ultimately be decided by the (state) Supreme Court,” Stegner said.

Stegner awarded summary judgment to the University of Idaho last month, saying the school’s faculty handbook reserved the right to change benefits by the State Board of Education and the university.

Moscow attorney Ron Landeck, who is representing the former university employees, had filed a motion asking Stegner to reconsider his Nov. 2 ruling. He argued the provision should not have been considered as part of the ruling on the early retirement agreements signed in 1999 and 2002.

The decision on whether to pursue legal action at the state’s high court will be up to the retirees but they were “not to that point yet,” Landeck told the Associated Press.

The lawsuit stems from a tort claim filed by four retirees in 2007 that said the university made unauthorized changes to early retirement packages offered to staff and faculty several years ago to help offset budget deficits.

Retirees say the university agreed to pay the full tab for medical and life insurance premiums, but later revised the benefits. Early retirees say they were given the option of reduced medical coverage, or paying $240 a year extra to keep the same policy. For life insurance, benefits awarded in the contracts were based on salaries and in some cases valued at $75,000, but were reduced by the university to $10,000.

Landeck filed the lawsuit on behalf of the retirees last year. Stegner made it a class-action case in October 2008.

The school had lauded the judge’s Nov. 2 decision, saying “the ruling is consistent with our understanding of the law and the university’s ongoing right to revise its employment benefits and benefits programs for its retirees.”

It will wait for the judge to issue a new written ruling in the case before commenting further, UI spokeswoman Tania Thompson said Monday.

Arthur Smith, a former law professor and one of the retirees who filed the initial tort claim, said former employees who joined the lawsuit were upset about more than the additional costs they took on after the changes were made.

“I think people felt like they had been dealt with unfairly,” Smith said. “That more than any other single factor explains why the retirees didn’t want to let this drop. They expected more from the university.”