City Workers and Retirees v Detroit's General Retirement System
Arguments on Detroit Pension Mismanagement Suit to Start
A Wayne County judge is scheduled to hear arguments on whether a class-action suit alleging mismanagement of Detroit's General Retirement System can proceed.
Detroit attorney Charles Chomet filed the suit on behalf of more than 20,000 city workers and retirees, citing recent investments that have cost the pension fund $35 million.
The suit, which has not yet been certified as a class action, alleges the fund's trustees breached their fiduciary duties to invest the pension funds responsibly.
It also alleges gross negligence and breach of contract.
The trustees argue they have governmental immunity and the lawsuit should be tossed.
Chomet cites failed investments such as $20 million lost after it was loaned to a company headed by Kirkland Dudley, a businessman with a history of unpaid bills who has since been convicted of fraud. The suit also cites trustees' practice of billing the fund for trips to locations such as Florida and Singapore.
But the trustees argue the lawsuit ignores the $4 billion fund's generally positive performance.
Further, employees and retirees have yet to suffer any damages in terms of lost pension income, so they have no standing to bring a lawsuit, the trustees argue.
For more information please contact:
Charles Chomet
Kelman & Loria, PLLC
313-961-7363 ext 235
