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W.Va. high court rules in favor of hospital employees

June 15, 2010|By TRISH RUDDER

BERKELEY SPRINGS, W.Va. -- The West Virginia Supreme Court of Appeals in a 5-0 decision Tuesday upheld a lower court's ruling that 15 female employees of War Memorial Hospital should receive the funds held in trust from the hospital's terminated pension plan.

On May 4, 2009, 23rd Judicial Circuit Judge John C. Yoder ruled in favor of the employees that the hospital's pension plan was terminated effective Dec. 31, 2003, and the funds held in trust should be distributed to them.

The lawsuit was filed in June 2007 in Morgan County against the hospital, its board of directors, then-hospital President John Borg and Valley Health Systems, the firm that managed the hospital.

The defendants appealed Yoder's decision to the state supreme court.

Plaintiffs Jennifer Baker, Janet Horner, Sharon Hendershot, Barbara Johnson, Tanya Manley, Helen Miller, Christine Mullen, Ruth Smith, Bernice Stotler, Dee Ann Stotler, Linda Stotler, Barbara Yost, Carol Layton, Nancy Waugh and Terry Kesecker were participants in a defined benefit plan that was adopted by the hospital in 1972 to provide retirement benefits to its employees, according to the lawsuit.

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In 1987, the hospital stopped the plan and a defined contribution plan was put in its place. The assets of the old plan were frozen, according to the lawsuit.

In 2006, War Memorial Hospital sued the women because they would not sign a waiver allowing the hospital to keep the surplus funds, according to court documents.

The lawsuit is asking for "an amount in excess of $1 million in compensatory and punitive damages, plus interest, costs and attorney fees," Lawrence M. Schultz, the employees' attorney, has said.

The issue of whether the hospital was in violation of fiduciary duty has not yet been decided, Schultz said.He said Tuesday he has contacted Yoder's office to set up a court date.

Morgan County sold the hospital's assets in March to Valley Health.

"This is Valley Health's problem," Schultz said Tuesday. "Morgan County will not have to pay; the county owned the land and the building."

Schultz said the women were "very excited, grateful and feel vindicated that they were right all along."

He said about $750,000 in surplus pension funds should be distributed to the 15 women.

"Now is the time to pay," Schultz said.

"War Memorial officials have not reviewed the decision and cannot comment as yet," War Memorial Hospital President Neil McLaughlin said Tuesday.

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