His view of the events leading up to the filing of the lawsuit, the complexity of the issues involved and what has happened since the decision was issued by Judge Govendo almost two years ago differs greatly from mine. My comments are as follows:
Frankly, I don’t know the exact amounts paid attorneys and, for purposes of this letter, I will assume that the figure mentioned in the Villagomez letter ($242,161) is the correct amount that was paid to the various attorneys who worked on the case which was ultimately decided by Judge Govendo in June, 2009.
If memory serves me right, the lawsuit was filed in 2006 by the NMIRF after the CNMI government failed to honor its financial and legal obligations to the NMIRF after many, many years. One has to wonder why it took the Board of Trustees so long to make that decision, given the fact that the trustees have a strict fiduciary duty to protect the interests of active members and retirees.
The lawsuit languished in the Superior Court for several years. During that period a default judgment was entered and the only real issue remaining when the case went to trial in 2009 was how much was owed. Why the CNMI government allowed a default judgment to be entered and then made the NMIRF prove damages was a mystery to me as the amounts owed had been, for the most part, agreed upon by the parties and could have been stipulated to. (This, of course, would have substantially reduced the $242,161 which was ultimately paid the NMIRF’s legal team according to Mr. Villagomez.)
Once the proceedings commenced in 2009, obtaining a favorable decision regarding payment of employer contributions by the CNMI government was not particularly difficult. Any competent accountant could have been put on the stand by the NMIRF’s legal team to present evidence as to the amount of employer contributions owed, accrued interest, penalties and the like. Proving up unpaid taxes and fees owed the NMIRF was also simple. The NMIRF legal team merely had to produce a copy of whatever CNMI statute mandated payment to the NMIRF and then put someone on the stand to state that the monies had not been paid by the Department of Finance. (The former NMIRF comptroller, Mr. Noel Soria), would have had that information at his finger tips as there were numerous demands for payment of these amounts by NMIRF officials over a period of many years.)
In short, this was not a case which required any special legal skills or expertise. It was a relatively simple collection case because the issue of liability had been conceded by the CNMI government. The NMIRF must have done a decent job in proving up damages, but, again, according to Mr. Villagomez in his recent letter, the legal team was paid $242,161 for what I would describe as “shooting fish in a barrel.” The fact that the CNMI government’s own lawyers did not mount a real defense adds credibility to my analysis of the case.
$242,161.00 is hardly “chump change” in the real world and I see no need for anyone to apologize for any mistake which may have been made regarding what was actually paid the NMIRF attorneys in this matter. In my opinion, the NMIRF did not get a bargain or even a good deal, given the fact that it has yet to collect any money under the judgment! Mr Villagomez seems to think that this is a good deal!
It would have been nice if Mr. Villagomez would have sat down with a pen and pencil and added up the amounts paid by the CNMI government to satisfy the $231 Million judgment handed down by Judge Govendo almost two years ago.(We would have gotten a blank piece of paper.)
Instead he chose to spoon feed your readers some nonsense about other payments/benefits which have flowed from the suit! This is pure nonsense as they were legally mandated before Judge Govendo rendered his decision.
Simply put, nothing has been paid by the CNMI government to reduce the amount that it owes the NMIRF under the 2009 decision. In fact, the amount of the judgment has increased to over $300 Million and the CNMI government has not been making timely payments for current employer contributions it owes the NMIRF.
If anything, things have gotten worse and not better for retirees who rely on NMIRF annuities for their daily needs and for active members who want to retire someday .It is about time that the members of the NMIRF, be they active or retired, take a good look at the management of their retirement system. A financial and management audit of the NMIRF (conducted by impartial experts) is needed before it is too late!
The highly paid lawyers, money managers, consultants and the well paid staff of the NMIRF are all eating off our plates! Whose interests do they really serve? Who really benefits from quick fixes such as the floating of a Pension Obligation Bond? Please give these matters some serious thought.
DAVID L. PRICE
Retiree
