Retirement Fund Drama

March 1, 2010

The Retirement Fund debate appears to be turning into a mud slinging fest. At a recent meeting of the Commonwealth Retirement Association (CRA) members it was reported that some of those gathered attacked attorney Bruce Jorgensen despite the fact that he was not there to respond or to defend himself.

In an email to Unheard No More, Mr. Jorgensen said, "CRA Board members and others, while criticizing me, rebuked retiree Roger Ludwig's offer to use his phone to call me during the meeting to respond to any queries or questions."

Most of the 100 or so members of the Commonwealth Retirees Association declared that they would not join the lawsuit that Attorney Bruce Jorgensen filed against Governor Fitial, the Marianas Retirement Fund and Fund Board in August 2009.

The Commonwealth Retirement Association (CRA) was incorporated only a little more than a month ago in January 2010 according to the Saipan Tribune.

Some members thought that the total amount that the CNMI government owed to the fund should be paid to the fund rather than having some go to Jorgensen's attorney fees. Yet, since June 2009 when the CNMI Superior Court ordered the CNMI government to pay the $230 million it owes the fund, the government has not paid the debt. In fact, as of February 2010 the government owes the Fund $280 million.

Mr Jorgensen stated:
The retirees face the prospect of Fund insolvency not because of the character of the single attorney willing to aid the plight of a few in the U.S. Court system, which unlike the CNMI Judiciary is not a $10 million delinquent debtor to the Fund, but rather to the malfeasance of many former Fund/Board/CNMI officials who find distasteful facing now the consequences, in the U.S. Court via a court-mandated "equitable accounting", of their reputedly unlawful and unethical conduct precipitated and perpetuated over many years and administrations resulting in the imminent collapse of the Fund and the years' long delay in forcing and effecting payment of the hundreds of millions owed to the Fund by the CNMI.

Collecting/enforcing upon a judgment is such a very simple matter in the U.S. Court as it should be in the CNMI Judiciary.

Yet a $231 million judgment now worth $280 million or so has been left to languish in the CNMI Fund/Board officials and lawyers beholden to BenTan for their continued employment.
Today's Saipan Tribune reported:
The members cited fear of having the Fund placed on receivership and what they termed as the “questionable credibility” of Jorgensen himself as reasons for their lack of support for the lawsuit. A few members of the audience, however, came to Jorgensen's defense, saying the lawyer has at least taken the initiative of bringing the case to the federal court.

During his presentation, CRA official Oscar Camacho said the group decided not to support the Jorgensen lawsuit after members found a lot of “ambiguities” in the case.

Camacho said that Jorgensen's intention to have the Fund placed on receivership is sowing fear in the public.

“Yes, we want the government to pay. But the idea of receivership is throwing out fear to the public. Our active employees are very scared and many have already taken out their money because of non-confidence,” Camacho told the crowd.

Others in attendance also expressed concerns about Jorgensen's credibility, saying the lawyer, who is based off-island, may only be interested in getting a big slice of the pie as lawyer's fee in the event the government pays its debt to the Fund pursuant to the court judgment. Association members said this is “not acceptable.” They cited that the government debt has already been determined by the court and should be paid entirely to the Fund.
Not everyone spoke against the lawsuit. Former Rep. Tina Sablan, who joined David Price as a plaintiff in the lawsuit last month, spoke in favor of it. The Tribune reported that others also spoke in favor of the lawsuit:
“At least Jorgensen is doing something and is taking the government to the federal court which no one here has taken the initiative,” a Jorgensen supporter said.

Through the Jorgensen case, the federal court can implement and make the government pay its debt, which in turn will benefit all retirees, said another attendee.
Concerning his credibility and attacks on his character, Mr. Jorgensen stated:
A well known legal axiom states: "When you've got the law on your side, argue the law; when you've got the facts on your side, argue the facts. But when you've got neither on your side, make some noise, cause some distraction, attack personalities." That is what "character assassination" derives from.
Where have these character assassination attacks been until now? Why now? Why did they not surface until a Federal Judge issued a January 25th order describing as "compelling" the arguments asserted on the Roe plaintiffs' behalf while pointing out the U.S. Court's perception that "negotiations" as to collection of the $231 million owed the Fund by the CNMi were essentially, well, in my words, "asinine."

Apparently, this same Federal Judge in front of whom I've successfully appeared for over 20 years has no qualms as to "credibility" issues."
While Jorgensen's lawsuit was criticized some supported the Merill Lynch lawsuit that was filed in Superior Court by Mario Taitano, Roman Tudela and Patricia Guerrero. The lawsuit alleges that the Retirement Fund's chief financial consultant, Merill Lynch charged the fund excessive hidden service fees and gave bad investment advice.

Attorney Jorgensen stated:
It's quite interesting that folks are questioning my attorney fees when these same people have never questions others' attorney fees - e.g. those being paid the Fund/Board current and former in-house lawyers, or the private lawyers now being paid to represent the Fund/Board, or as to multitudes of other CNMI agencies/entities retaining private counsel.
It's equally curious that while the Taitano case puts the Fund/Board at multi-million-dollar risk for substantial liability (including payment of Merrill Lynch's attorney fees) should Merrill Lynch prevail, no concern is expressed as to the 1/3 of millions in Fund recovery money to be paid Taitano and/or his attorneys should they prevail.

By contrast, the U.S. proceeding in no manner puts Fund assets at risk or raises the possibility of the Fund/Board being sued or liable to third parties like Merrill Lynch.

Rather, in the U.S. court proceeding, my fees will be overseen and awarded by the U.S. Court based on factors including quality of representation, difficulties involved, novelty of issues, and failure/unwillingness of other lawyers to provide this necessary representation...often using what's called a "lodestar" analysis which essentially is a manner by which the U.S. Court orders compensation to be paid to prevailing counsel on an hourly basis with no payment if no positive results.
Marianas Variety reported, "Taitano said they may be forced to name the board and its present and past members as defendants, in their official capacities, if they don’t join their lawsuit against Merrill Lynch."

Regarding the Merill Lunch lawsuit Jorgensen stated:
Mariano Taitano says his Merrill Lynch lawsuit won't cost the Fund/Board any money even if Taitano loses?

Sheer nonesense. And he knows this. The lawsuit is ALREADY costing the Fund/Board money because Fund/Board officials and lawyers have to prepare and will have to participate in the litigation which presently they must at minimum be engaged in monitoring closely.

Hasn't Taitano already named the Fund/Board as defendants?

If not, there can be NO QUESTION that Merrill Lynch will name the Fund/Board as parties and bring the Fund/Board into the lawsuit.

Which of course would not have been the case if Taitano had not filed the lawsuit in order to seek money gains and to split a possible 1/3 of the millions at stake with his lawyers...or will he and his lawyers be donating their recovery amounts back to the Fund/Board? (Yeah, right---about the same time that pigs will be able to fly, or when frogs don't bump their butts.)

In response to Taitano's claims against Merrill Lynch, the lawyers representing Merrill Lynch will assert that the real wrongdoers were not Merrill Lynch folks but, rather, were the Fund/Board and/or Fund/Board former officials including most likely former Fund Board of Trustee members-----incuding, perhaps, Taitano himself.

In so doing, Merrill Lynch will file what are known as third-party-complaints and/or cross-claims against the Fund/Board which then will cause the Fund/Board to have to participate due to Taitano's bringing this lawsuit for monetary gain seemingly for himself and his lawyers...again, unless they are donating all of their possible recovery to the Fund/Board.

Taitano says his lawsuit will not cost the Fund/Board money? Why of course the Fund/Board will have to spend tremendous amounts in paying attorneys to monitor and participate in the Taitano lawsuit on behalf of the Fund/Board if the Fund's beneficiaries are to receive competent representation by attorneys without conflicting interests.

And what if Merrill Lynch prevails against Taitano and the Fund/Board? With Merrill Lynch gets a multi-million dollar award?

Well, it's fairly predictable that Taitano will then tell the world that he is poor and humble and simple fellow, who unfortunately can't pay the multi-million dollar judgment in Merrill Lynch's favor...

And so guess who then will be left having to pay the multi-million judgment caused by Tatiano filing this lawsuit which he and his lawyers knew or should have known from the beginning would involve the Fund's limited assets---as he told us the lawsuit would cost the Fund/Board nothing?

Why, of course the Fund/Board will have to pay this multi-million judgment out of the Fund's shrunken-to-near-exhaustion assets..

Indeed, this might be a case where former Fund/Board officials, like Taitano/others (e.g. former Board members or Fund lawyers), know of or might have been involved past wrongdoings at the Fund---which as we all know in on the brink of collapse due to years' of internal mismanagement and reputed wrongdoings---and so these former Fund/Board officials are now trying to take the offensive and strike first...before these former Fund/Board officials' wrongdoings come to light.

As we all know, this is precisely why former Fund/Board officials---including some now affiliated with and seeking to control the so-called Commonwealth Retirement Fund ("CRA") via utterly undemocratic CRA decision making (e.g. CRA Board decisions made without prior polling or voting or electoral participation by the entire CRA general membership)---now so vigorously oppose the Fund litigation now before the U.S. Court in the Roe v. Fitial proceeding.

That is because in the U.S. Court proceeding, the Roe plaintiffs have asked the U.S. Court, among other things, to conduct an equitable accounting, in order to find out who among the Fund/Board officials engaged in apparent wrongdoings leading to the Fund's collapse over the years---and for those people to then be held accountable in the U.S. Court (as have other former CNMI officials) for these wrongdoings via prosecution in U.S. Court civil lawsuits or U.S. criminal actions...(in a U.S. Court which, unlike the CNMI Judiciary, does not itself owe $10 million or so long in arrears to the Fund and does not have judges who are Fund beneficiaries and who are beholden to and controlled by the CNMI Executive and Legislative branches which in turn decide how much CNMI funding will annually be provided to the CNMI Judiciary).

And, of course, those people to be held accountable in the U.S. Court might eventually be determined to include current CRA board members, current CRA members-at-large, or current/former Fund officials who acted wrongfully, unlawfully, in violation of fiduciary duties, in conflict-of-interest situations.

And of course Mr. Taitano must know this. He was a former Fund official, was he not?


Fund Member said...

Jorgensen must be getting pretty desperate to use the bogus Taitano/Dotts lawsuit to justify his own.

Even if the latter is a big waste of time, what can we do about it? Waste more of our assets on Jorgensen?!

As for Jorgensen picking David L. Price as a "class representative," weren't he and Rexford C. Kosack the ones who brought the abusive garment industry to Saipan?!

And is Tina Sablan even a member of the Defined Benefit Plan?

This whole Jorgensen scheme sounds a big waste of our money. If it is so great, why did his co-counsel Timothy Lord's law firm [that specializes in such lawsuits] not join the litigation?

Maybe because they recognized that the suit had no merit?

The federal courts have no role in this case, it is purely and completely a matter of local law and sovereignty.

Saipan Writer said...

I have trouble believing Bruce Joregensen when he will never return to Saipan, CNMI because he is in hiding with his son, trying to prevent the child's mother from seeing him.

He's low-down dirty and despicable on the personal level, in my opinion.

So I think, on the merits of the claim, retirees would do better to find a more reputable lawyer to represent them.

Anonymous said...

I see what you mean by mud slinging.

Everyone knows where Jorgensen is because he has made his email and phone number public. He isn't a very good hider if that's what he is doing.

Should the lawsuit be judged on its merits? No one attacked Attorney Lord who filed with Jorgensen. Is he reputable enough?

Think about the lawyers who are "reputable" in the CNMI! Maybe you can count them on one hand. There's Schemer who had a judge fine her hundreds of thousands for violations. Willens and Buckingham who kiss so much Fitial butt that they are full of s**t. There's O'Connor who is as slimy as it gets. Kara and Mailman who have their immigration paperwork gig and sidelines with DOL, Fitial and Schemer. A couple lawyers are out on bail waiting for their own trials and another one who really was hiding in the Philippines is now in prison waiting for his trial. There's the CNMI bar that ignores numerous bar complaints against lawyers that rip off innocent workers.

Good luck finding a reputable lawyer! Most of the reputable lawyers are employed by the CNMI or federal governments or private agencies like Micronesian Legal Services. Better to look at the lawsuits on their merits.

Anonymous said...

Noni 8:48 You left Woodruff out of the list. He had that scheme that charged a $100 in membership fees to join Dekada with a promise of green cards. He and Sagana split the money and Sagana's wife got a job with Woodruff. Sagana defends him for every move he makes, good or bad so he can stay in the CNMI and his wife can keep her job. Hey Woodruff how about a treasurer's report or accounting of Dekada funds? What's that? You forgot? We didn't!

Anonymous said...

Totally agree with anon 8:48 and 8:58. Aren't lawyers in the CNMI are mostly out there just to get money?..When they settle with worker's lawsuit, they even claim more than what the workers get. And mind you, 1099 is issued to the name of the workers even the lawyer's portion as part of the settlement. How did I know, well, been working here in some big corporations and most settlements were done that way. I really pitied those workers, no taxes for the lawyers while the worker's portion get lessened by the taxes from the lawyer's.

Saipan Writer said...

Bruce J. is in hiding. You can't serve legal process by phone or e-mail. The physical address he gives is for a tee-shirt factory and certified mail to him there is returned unclaimed.

As for the attorneys in the CNMI, we have our share of greed, incompetence, and lack of ethics, but we also have some high caliber, highly competent and ethical attorneys too.

The CNMI Bar Disciplinary Committee has never really worked because it's volunteer only, and there is too much work, and too tricky work, for a volunteer committee to do.

But on the Retirement issues, the subject of the post, the CNMI Retirees really need counsel. The issues are not simple or easy. And there are conflicts of interests making it unlikely the government will sort things out on its own. These former government employees need face-to-face counseling and legal representation.

Anonymous said...

If Tina Sablan says Bruce Lee Jorgensen is: a highly-skilled attorney, well-versed in CNMI law (despite not being admitted to the CNMI bar), of unimpeachable credentials, of fine moral character, of impeccable integrity, mentally stable to an unusual degree, a persuasive and unemotional legal writer and advocate, a master in using legally significant press clippings as exhibits, invariably courteous and polite to opposing counsel, and possessed of excellent vision, how can it be otherwise?

Doesn't he claim an "in" with Judge Munson? That's a great help too! What about that contract worker he hit and injured while driving drunk in the early 1990s, and then tried to pressure his foreign girlfriend to take the fall? Never mind those little details.

After all, lawyers are fungible. They're all the same. Right? Wrong.

Anonymous said...

It's not just Jorgensen. A lot of the people who have tried and are still trying to accomplish important public reforms in and for the CNMI are persons of questionable ethics, motives, competence and/or sanity. I'm sure you can all think of numerous examples.

But we are who we are, and who we are is all we've got, so we should not be too quick to attack anybody who is willing to actually do something, whatever his or her real faults may be. That is one of the tightropes we have to walk around here -- to support our own would-be champions in their worthwhile efforts, while recognizing and being wary of their limitations.

To mix canine and crustacean metaphors, we need to keep them on a short leash, but not so short as to always be pulling them back into bucket.

Anonymous said...

Wow! Mud slinging was the wrong term. This is not mud here. This is feces. Noni 10:19. Tina said no such thing A$$hole. Noni 11:48 you got it right.

Anonymous said...

So you're saying Tina doesn't hold the praiseworthy opinion of her lawyer as described at 10:19?


The word "if" is an important one.


BTW, since you seem to know so much about what Tina says and does, is she actually a member of the Defined Benefit Plan?

Louder, please? The silence is deafening.

I thought not. Well, well, well. Another career "change-oriented" politician's folly. No thank you, I prefer to continue receiving my benefits.