Ayuyu, Ind.-Rota, told reporters yesterday he will introduce a bill today seeking to repeal Public Law 17-51 that allows retirees to sue on behalf of the Retirement Fund if its trustees refuse to do so.
The law was authored by Senate Floor Leader Pete P. Reyes, R-Saipan, and was signed into law by Lt. Gov. Eloy S. Inos in an acting capacity as governor despite the Fund’s opposition.
Ayuyu said he did not vote for the law’s passage.
Some board members of the Retirement Fund and a lot of retirees, he added, have been seeing him over the last few weeks urging him to repeal the law.
Ayuyu noted that the Fund is now having a hard time finding new money managers because of the derivative law.
Without money managers and investment consultants, the senator said it is going to be more expensive for the Fund to get new ones.
Also, Ayuyu said the Fund has already joined the lawsuit against Merrill Lynch so there is no need to have a law in place to allow more people to sue on behalf of the pension agency.
He said he was assured that the Fund will continue to go after Meryll Lynch in court even if the derivative law is repealed.
In a separate interview, Commonwealth Retirees Association chairman Larry LG. Cabrera said he does not think the derivative law is needed.
“It was a mistake for the Legislature to allow somebody to sue on behalf of somebody else,” he added.
But attorney Michael W. Dotts in an email said a repeal is unnecessary.
The Superior Court, he noted, found that the derivative law did not the cause harm to the Fund.
Instead, he added, the law created more rights for both the Fund and retirees.
Dotts said the Fund’s consultant, auditor and two money managers who have resigned are all “replaceable.”
“Given that the Fund will be gone in three years even if these ‘advisers’ stick around, they are really not that needed,” he said.
“Perhaps the best evidence that no repeal is necessary is that the ‘flood’ of lawsuits that the Fund predicted never came true,” he added.
He noted that it has been a month and a half since the law opened the door to retirees to go after those who have harmed the Fund and no new lawsuits have been filed.
“There seems to be a group who do not want retirees to have the ability to look at the bad decisions made by the Fund. But the Fund belongs to the retirees and not the trustees. The derivative law is good for the retirees and should not be repealed,” said Dotts, who represents three retirees who sued Merrill Lynch.
