Justices chastise UC Regents in retiree benefit case

By Laura Hautala

SAN FRANCISCO - A state appellate court panel seemed to side with retirees of Lawrence Livermore National Laboratory during oral arguments Tuesday as it weighed whether their case for government health insurance can proceed.

The retirees claim the University of California Regents wrongfully transferred them off their health plan.

The case tests a state Supreme Court opinion last year in which the court recommended that retirees of the Orange County government be able to pursue a request to have their government health benefits restored.

'We don't have a statute, and we don't have a collective bargaining agreement, so all we have are the booklets.'

- Joseph M. Quinn

During Tuesday's arguments, Joseph M. Quinn, a partner at Hanson Bridgett LLP, argued that a lower court was correct to dismiss the case last year because there wasn't a contract promising health benefits. Without a contract, plaintiffs cannot allege that the University of California Regents violated any promise, he said.

"No document says that," said Quinn, who is joined in representing the regents by Hanson Bridgett attorneys Dorothy S. Liu and Sarah D. Mott.

The regents removed the retirees from the general pool of UC health care recipients in 2007, when a private contractor took over Lawrence Livermore. That contractor now pays for part of the retirees' insurance, but name plaintiff Joe Requa said his own contribution has gone up from about $75 to nearly $600 a month since the change. Joe Requa v. The Regents of the University of California, Al32778 (Cal. App. 1st Dist., Jul. 29, 2011).

Requa and three other retirees filed a request in Alameda County Superior Court in 2010 asking that their government health benefits be reinstated; the plaintiffs argued they were denied a benefit that was promised as deferred payment for their service at the lab.

The regents said they never made such a promise. Last year, Superior Court Judge Frank Roesch agreed with the regents and dismissed the case at the demurrer stage.

But the case presents a chicken-and-egg style conundrum: whether a contract existed might be solely a question of fact - something that cannot be addressed at this stage in the case.

Presiding Justice Barbara J. R. Jones seemed to disagree with the lower court's ruling Tuesday, and appeared peeved at Quinn when he brought up contractual issues. At one point, she reminded Quinn that his team's briefs contained factual errors. "It is not helpful to misstate the standard of review," Jones said.

"I agree," Quinn said.

He returned to the question of whether the regents promised to cover the lab retirees' health care indefinitely.

"We don't have a statute, and we don't have a collective bargaining agreement, so all we have are the booklets," Quinn said, referring to employee benefits booklets the retirees have pointed to as evidence of a promise.

Jones said Roesch made factual findings but shouldn't have.

Dov M. Grunschlag, a partner at Carter, Carter, Fries & Grunschlag, argued for the retirees, saying their allegations should proceed in the lower court, "even though there is no formal contract between the parties."

Associate Justice Mark B. Simons said he thought the regents had admitted the promise was made in the initial court proceedings. "They, again, accept that the authority for benefits came from the regents," Simons said. "That's really all that's required as a matter of pleading."