High court could decide soon on health trust suit

June 9th, 2015 3:03 pm

First Posted: 3/19/2014

EDWARDSVILLE — The U.S. Supreme Court could decide “as early as March 24” whether the long legal battle over $8 million between two school districts and the Northeast Pennsylvania School District Health Trust is over, attorney Cynthia Vullo told the Trust Board members at their monthly meeting Wednesday.

Vullo said the nation’s highest court has scheduled a conference March 21 on a “writ of certiorari” filed on behalf of the two districts.

Such a writ is a request for the nine justices to consider a case. Odds are statistically against such petitions.

The court’s website says about 10,000 are received annually, but only 75 or 80 win a chance to make oral arguments.

Vullo said the court could give notice of its intent by the following Monday, most likely either declining to consider the case and effectively ending it, or by asking the trust to file a brief in defense of its position.

In 2007, the two districts, Dallas and Pittston Area, withdrew from the trust, a consortium of area education agencies formed in 1999 to curb health insurance premium costs. The districts have been trying to get what they say is their share of a trust surplus at the time they withdrew.

A lawsuit won an early victory for the districts, with a Luzerne County judge ruling they were owed the money and ordering the trust to put $8 million in a restricted account pending appeals.

But the districts have lost every appeal since, including one to the Pennsylvania Supreme Court.

At the federal level, their argument is that the trust is a “segregated trust” that keeps track separately of each member district’s costs and payments, and that it’s dealings with the district fall under the federal Employee Retirement Income Security Act rules, which would require the trust to pay the districts their share.

The trust contends it is a “pooled trust” and that the agreement signed by all members expressly says any surplus stays with the trust unless it is completely dissolved.