1.
SEC SENDS MESSAGE TO MIAMI:
The lead article in a recent State & Local Law News
deals with the City of Miami and its woes concerning bonds issued in 1995
(see C&C Newsletter for August, 2001, Item 2). On March 21, 2003, the
Securities and Exchange Commission issued a cease-and-desist order against
the City of Miami, in which the city was ordered to cease and desist committing
or causing any violation or future violation of the antifraud provisions
of Federal Securities Laws. In difficult economic times for local governments,
oversight by elected officials and staff is especially important. Some
of the most significant enforcement cases prosecuted by the SEC against
local governments that issue bonds are originated in decisions made during
economic downturns or other periods when the affected local governments
experience fiscal difficulties. As states and local governments again wrestle
with such difficulties, they may well be tempted by a short-term solution
that will ultimately cost them and their governmental unit much more in
the long haul. The following statement from a former city manager, quoted
by the SEC in its opinion, ought to send shivers down the spine of any
investor:
Let me ask you this, does anybody read this [Official
Statement]? I mean, only experts read this... . [M]ost people don’t
read this, nobody reads this. They go by what the raters, that is Moody’s,
Standard & Poor’s, saying that these bonds are safe to buy.
By rating them AAA, they’re a very good buy. Therefore, they
wouldn’t go reading through this. Nobody does.
Read the entire SEC opinion and order imposing remedial
sanctions at http://www.sec.gov/litigation/opinion/33-8213.htm.
2. ADVERSE
EMPLOYMENT DECISION DOES NOT SUPPORT CLAIM OF SUBSTANTIVE DUE PROCESS
VIOLATION UNDER FEDERAL CIVIL RIGHTS LAW, UNLESS FUNDAMENTAL RIGHT
IMPLICATED:
The City of Lauderhill, Florida, reorganized its police department,
eliminating the position of lead police officer. Three former lead
police officers sued the city over their failure to achieve the equivalent
rank of sergeant in the reorganized department. All three recovered
damages in the trial court for substantive due process violation under
42 U.S.C. §1983. On appeal, however, the judgment was reversed,
with directions to enter judgment in favor of the city. Following decisions
of three separate federal appellate courts, the Fourth District Court
of Appeal held that, if it does not implicate a fundamental right,
an adverse employment decision rendered through an executive act will
not support a public employee’s claim of a substantive due process
violation under 42 U.S.C. §1983. Because an employee’s property
interest in an express or implied employment contract is not fundamental,
it falls outside ambit of substantive due process. The City of Lauderhill
v. Rhames, 28 Fla. L. Weekly D2412 (Fla. 4th DCA, October 22, 2003).
3.
SOCIAL SECURITY MAY DETERMINE CLAIMANT NOT DISABLED BECAUSE OF INABILITY
TO DO PREVIOUS WORK, WITHOUT DETERMINING IF THAT WORK EXISTS:
A person is disabled, and thereby eligible for Social Security Disability Insurance
benefits and Supplement Security Income, only if his physical or mental impairment
or impairments are of such severity that he is not only unable to do his previous
work but cannot, considering his age, education and work experience, engage in
any other kind of substantial gainful work which exists in the national economy.
After her job as an elevator operator was eliminated, Thomas applied for disability
insurance benefits and SSI. An administrative law judge found that her impairment
did not prevent her from performing her past relevant work as an elevator operator,
and rejected her argument that she is unable to do that work because it no long
exists in significant numbers in the national economy. The Federal District Court
affirmed the ALJ, concluding that whether Thomas’s old job exists is irrelevant
under Social Security Administration’s regulations. Sitting en banc, the
Third Circuit Court of Appeals reversed, holding that the law unambiguously provides
that the ability to perform prior work disqualifies from benefits only if it
is substantial gainful work which exists in the national economy. In a (rare)
unanimous decision, the United States Supreme Court held that the Social Security
Administration’s determination that it can find a claimant not disabled
where she remains physically and mentally able to do her previous work, without
investigating whether that work exists in significant numbers in the national
economy, is a reasonable interpretation and should be upheld. Barnhart v. Thomas,
17 Fla. L. Weekly Fed. S3 (U.S., November 12, 2003).
4.
ATLANTA PENSION BOARDS GEAR UP TO SUE CITY:
According to a report in the Atlanta Journal-Constitution, Atlanta police, firefighter
and general employee pension boards will sue the city to wrest control of their
retirement funds from the city. The funds are controlled by three separate boards,
made up of elected employee representatives, the city’s chief financial
officer and mayoral appointees. However, the city administers all three funds.
The city’s chief financial officer, who sits on the boards, admits that
police and fire representatives have legitimate frustrations in that city staff
doesn’t always answer questions about administration of the funds. However,
he believes those concerns have morphed into paranoia and baseless accusations
of rampant wrongdoing. An attorney for the three funds has given the city the
legally-required thirty-day notice that the boards intend to sue. The police
and firefighter boards voted to hire an outside firm to manage their pension
funds, but the Atlanta City Council passed an ordinance retroactively prohibiting
such action without Council approval! Stay tuned for the next round.
5.
TO SAVE PENSION, DAUGHTER DRAGS DEAD DAD:
The daughter of a woman who allegedly killed her husband has also been charged
with a crime. The daughter, who lived with her parents, was charged with helping
her mother move her father’s body from the scene of a crime -- a felony
punishable by up to three years in prison. While the daughter said she was not
aware that her mother had killed her father, she did not report the death, and
chose instead to help hide the body ... after her mother said she could not survive
without his pension checks. The mother was charged with killing her husband of
forty three years, by allegedly injecting his body with insulin until he died.
Mother and daughter tried to move the body onto a pickup truck, but could do
so only by attaching extension cords to his feet and using a car to pull the
body onto the bed of the truck. The mother then drove the truck to a wooded area
and dumped the body, where it was discovered the next day. The mother told police
that she decided that she would have to kill her husband because he was about
to discover she had withdrawn $4,000 from savings to cover gambling losses. The
story comes to us from NWITimes.com -- “your information source for Northwest
Indiana.”
6. PERHAPS
THIS POLICE DOG NEEDS A LITTLE REFRESHER COURSE:
When a police dog was sent into a candy factory to track down
two intruders his sense of taste got the better of his sense of duty.
The 9½ year old German Shepherd nearly ate himself sick. Police
were called to a candy factory when seven teenagers were found helping
themselves to candy after they had broken into the facility. Although
five surrendered immediately, two ran away so police sent the dog
to follow their trail. He immediately found a trail of candy the
kids had left behind, plus more candy in the building. Unfortunately,
the dog stopped greedily to help himself. He was so full of candy
that he had to be transferred immediately to a more urgent assignment
-- on the lawn outside the building. The dog is fine and the two
miscreants remain at large. Because the dog is ready for retirement,
he won’t face any disciplinary action, according to the AP
report.
|
