Court rules against unions in pension case

A state appeals court ruled this week that four San Diego city employee unions aren’t entitled to $1.7 million in attorney’s fees from a 2010 lawsuit over the pension contributions of city workers.

The pension litigation was settled in 2013, with the city backing away from a new demand that workers contribute more toward their pensions in years when San Diego’s retirement fund suffers investment losses.

Under the settlement, however, the city retains the right to possibly reinstitute that demand, which would be a sharp departure from current practice where employee contributions are a fixed percentage of salary.

The city sought the policy change after the retirement fund lost $800 million in 2009. The goal was getting employees to cover half of that loss, or $400 million, with larger contributions.

City Attorney Jan Goldsmith agreed to the settlement at the direction of the City Council, which was concerned about the retention of police officers.

After the settlement, four city employee unions sued in 2014 for attorney’s fees totaling $1.7 million because their lawyers participated in the case.

A lower court ruled against the unions, saying they aren’t entitled to attorney’s fees because lawyers for the retirement system would have achieved the same result.

On Tuesday, the Fourth District Court of Appeal upheld that lower court ruling.

Goldsmith said Wednesday the ruling shows the labor unions miscalculated.

“The labor unions wrongly saw this as an opportunity to get money from taxpayers,” he said. “We fought that effort and won.”

Michael Zucchet, general manager of the Municipal Employees Association, said it’s difficult to convince courts to cover attorney’s fees.

He also said the more important overall result is that the city retreated from its attempt to change the pension contribution policy.

“It was frivolous litigation that the city pursued for three years,” he said.

The four unions represent nearly 8,000 workers, including police and firefighters.