A look at legal firepower arrayed against state's pension overhaul law

Illinois Supreme Court might consolidate cases led by four sets of attorneys, including retired judge

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As Illinois leaders began searching for ways to fix the state's underfunded public employee pension system, Gov. Pat Quinn turned to retired Judge Gino DiVito for some free advice.

DiVito told him in 2010 that pension rights for current state employees were sacrosanct due to clear and plain language in the state's Constitution that said such benefits "shall not be diminished or impaired."

At the time, the governor and DiVito seemed to be in agreement. Four years later, the men are opponents.

Quinn championed and approved in December a controversial law that would raise retirement ages for many workers and limit cost-of-living increases. It would go into effect in June. The move by Quinn, up for re-election this year, is aimed at fixing the most underfunded public employee pension system in the country, payments to which are threatening the state's overall fiscal health and increasing the state's borrowing costs.

DiVito is representing some of those aggrieved state retirees and employees, and, in December, filed the first of four legal challenges to the law. The impending court battle will be one of the most important in state history, with the retirement security of hundreds of thousands of state workers hanging in the balance.

Quinn spokeswoman Brooke Anderson wrote in an email that the governor has received legal advice from a number of attorneys on the issue and that he believes the new law is constitutional and urgently needed.

"We expect it to be upheld," Anderson wrote.

Four separate legal challenges have been filed by four groups of attorneys. Given their similarity, the attorney general's office has asked for the cases to be consolidated in Cook County Circuit Court. The Illinois Supreme Court will make that decision.

Aside from DiVito, attorneys who have filed challenges to the pension law include two Springfield lawyers and the Chicago-based firm Freeborn & Peters.

DiVito got a bit of a head start when the governor asked him to give a second opinion on a legal analysis performed by law firm Sidley Austin LLP for The Civic Committee, a group of leading Chicago executives. Sidley's lawyers argued that "pension rights were not frozen in place for all of eternity and may be amended. ..."

DiVito and law partner John Fitzgerald responded, concluding that Sidley's analysis lacked "legal merit," and they spelled out their argument in at least two written rebuttals. DiVito said those memos drew the attention of the Illinois Retired Teachers Association and the School Administrators Association, whose memberships DiVito now represents.

DiVito's stake in the case is twofold. Not only is he a lawyer in the case, but he also is receiving a public employee pension from two decades as a judge, first in the Circuit Court, then in the Illinois Appellate Court. He retired from the bench in 1997. He described his pension as "a significant sum."

Two other challenges to the pension law were filed by Springfield attorneys John Myers and Donald Craven. They were hired by the Retired State Employees Association and the Illinois State Employees Association Retirees, respectively, thanks to their work on behalf of state retirees in a separate case. In that case, called Kanerva after plaintiff Roger Kanerva, retirees are trying to fight a state law that requires them to pay premiums on their state-subsidized health insurance. That matter is pending before the Illinois Supreme Court.

The fourth set of attorneys is from the Chicago law firm Freeborn & Peters. The firm represents the We Are One Illinois coalition, which includes the state's largest government employee unions.

"We had been working with the We Are One coalition through (pension) negotiations in the (Illinois) House and Senate going back a couple of years," said Freeborn & Peters partner John Stevens, who is based in Springfield and a registered lobbyist. "Once the legislature adopted the current law, our role transitioned from negotiator to litigator."

Stevens worked as a state employee for more than 20 years before joining Freeborn & Peters. He said his first job was drafting pension bills as an employee of the state's Legislative Reference Bureau. He worked on pension bills throughout the 1990s and departed state government as deputy counsel to the governor in 2002. Previously, he was general counsel to the Illinois attorney general and the Illinois comptroller.

"The folks involved in the coalition know me from the years I sat across the table from them," Stevens said. "I was a labor representative for the government, dealing with unions my entire government career, which spanned 22 years."

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