North Carolina State Retirees Class Action

220,000 Plaintiffs in Lake et al. v. State Health Plan et al.

Attorney Gary Jackson has been working with a team of attorneys on a class action lawsuit in efforts to restore retirement health benefits to more than 220,000 North Carolina state retirees. The class action alleges that as former employees of the state of North Carolina, these retirees were contractually promised health benefits, only to have them subsequently taken away.

First Plaintiff’s Victory* for Lake et al. v. State Health Plan et al.

Gary and his team have taken a giant step forward on behalf of the plaintiffs. In 2016, Judge Edwin Wilson, Jr. ruled that the retirement health benefits are contractual and that the state of North Carolina breached their contract when the class members began to be charged premiums for standard health insurance in 2011.

In other words, the Court determined that the state owes them the back premiums retirees were forced to pay*. Estimates are that North Carolina could be on the hook for over $100 million. Moreover, if the decision is affirmed, retiree premiums would be paid going forward, per the terms of the contract.

As expected, the state has appealed Judge Wilson’s ruling for the plaintiffs.

Gary Jackson and a team of lawyers filed this lawsuit prior to Gary joining the Law Offices of James Scott Farrin. As part of the legal team currently representing these clients, Gary said, “We filed this lawsuit in April, 2012, and it is now before the North Carolina Court of Appeals for the second time. Many retirees have died since we started the case, but we are determined to keep fighting for these folks for as long as it takes.”

What Does the NC State Retiree Lawsuit Allege?

The lawsuit states that, upon employment, retirement health benefits were contractually guaranteed to all state employees who participate in the Teachers’ and State Employees’ Retirement System (TSERS) of North Carolina, and who were hired before October 1, 2006 and completed five years of service.

The suit alleges that the state breached that contract in April, 2009, when the North Carolina General Assembly passed Session Law 2009-16 that eliminated the optional 90/10 health insurance plan. Another breach occurred in May of 2011, when they passed Session Laws 2011-85 and 2011-96, which required retirees to pay a premium to receive the 80/20 plan they had been promised.

Plaintiffs contend that these retirement health benefits were promised to state employees in exchange for working for the state for a certain number of years. The suit alleges that after these employees had met their part of the contract and eventually retired, the state pulled an abrupt 180-degree turn, and began overcharging retirees.

Class Action Began With 26 Plaintiffs in 2012

In April, 2012, an initial class action was filed against the State Health Plan and is referred to as I. Beverly Lake, et al. v. State Health Plan and State Employees, et al. At that time the lawsuit included 26 plaintiffs who had retired from employment by the state of North Carolina. These plaintiffs include members of the judiciary (including a former Chief Justice of the North Carolina Supreme Court and a former North Carolina Court of Appeals Judge), presidents and superintendents of community colleges and local school systems, teachers, law enforcement personnel, and administrators.

Class Action Grows to 220,000 Plaintiffs

Four years later, in 2016, the case was certified as a class action, and there are now more than 220,000 plaintiffs. If you meet the following criteria, you could be part of this class action lawsuit automatically and there would be no need for action on your part. You should have already been contacted via mail if you meet these criteria.

Lake et al. v. State Health Plan et al. – Criteria for Class Action Lawsuit

The criteria include all state retirees who vested in retirement health benefits and certain surviving spouses, specifically:

  • All members of the NC Teachers’ and State Employees’ Retirement System (TSERS ) who retired before January 1, 1988
  • TSERS members who retired on or after January 1, 1988, were hired before October 1, 2006 and have five or more years of contributory service with the state of North Carolina
  • Certain surviving spouses of former state employees or retirees, provided that the death of the employee or retiree occurred prior to October 1, 1986

“Our initial victories at the lower court* are steps in the right direction for hundreds of thousands of retirees who are simply asking for what the state contractually promised,” Gary said. “We are hopeful that the Court of Appeals will affirm Judge Wilson's decision in favor of the retirees.”

NC Class Action Attorneys Offer Free Case Evaluation

If you have been wronged in a manner that you believe affects others too, let’s talk about whether a class action may be in your best interest and potentially in the best interest of others. Contact us today or call 1-866-900-7078.

Class action cases are often heard in other states or federal courts. For this reason, our James Scott Farrin class action lawsuit attorneys work closely with other law firms nationally to help try to make sure clients have the legal representation they deserve.

*Each case is unique and must be evaluated on its own merits. Prior results do not guarantee a similar outcome.