Jury rules against retired Germantown teachers

90 sought $9 million in damages over insurance

WEST BEND - A lawyer for 90 retired Germantown teachers asked a jury Monday to award them more than $9 million in damages from their former employer, who the retirees say took away their affordable long-term care insurance in a political power play after passage of Wisconsin’s Act 10 law.

The district’s attorney urged jurors to reject liability under all three of the plaintiffs’ theories. “They ignored it (a warning that the insurance plan could terminate) and now they want to blame the School District,” Kevin Pollard said.

The lawyers’ closing arguments came after a weeklong trial, but it took the jury just an afternoon to decide the district owed nothing to the retirees.

The district added the benefit in 1998 but terminated its contract with WEA Trust in 2012. By then, the plaintiffs had been paying their own monthly premiums toward a paid-up policy after 30 years. Some came up with lump sums of $35,000 to $40,000 to pay up the policies, but 46 others did not, and forfeited about $200,000 in premiums for no coverage.

The retired teachers saw the right to continue paying the group-term rates as a vested benefit yanked from them.

In 1998, the teachers “made long-term concessions for a long-term commitment to long-term care,” said Randall Garczynski, attorney for Wisconsin Education Association Council, which represented the plaintiff class. He stressed that for 14 years, teachers were told upon retirement that the could continue coverage at the group rate by paying the premiums the district paid for working teachers and staff.

They relied on that promise and were left without coverage at an age where the price of a transition to individual policies was “staggering,” and some could not cover the lump sum buyout. The move only saved the district about $200,000, Garczynski said, which the district could have made up without affecting retirees.

Pollard agreed the collective bargaining agreements from 1998 to 2011 included the long-term care benefit, but there was no agreement in place when the board voted in 2012 to drop the benefit. And by then, he said, all the retirees’ agreements to keep up the coverage was with the trust, not the district.

And the insurance policy itself stated that if it ever terminated, those who had been covered could pay a lump sum to be paid up, or buy individually priced policies, which would cost much more. All the retirees signed a document that explained that.

The jury answered no to questions whether the district breached a contract or its duty to act fairly and in good faith.

The jury agreed the district had promised retirees could stay on the longterm care insurance if they paid their own premiums but said it wasn’t the kind of promise the district could “reasonably expect” would “induce action by the plaintiffs.”