In another example of state officials suing to halt drastic budget decisions, Insurance Commissioner Steve Poizner announced today he’s filing a lawsuit to stop the $1 billion sale of assets in a state-run workers’ compensation insurance fund. A spokesman for Poizner's department said they've retained Howard Rice Nemerovski Canady Falk & Rabkin. He added that they chose Howard Rice because of Steven Mayer, director of the firm’s litigation department, and his experience litigating public official matters in state courts.
“The pilfering of funds used to pay the claims of injured workers to instead help fill the state budget gap is both unconscionable and unconstitutional,” Poizner said in a news release. It’s unconstitutional, he added, because the Legislature is required to establish a whole workers’ compensation system, keeping the State Compensation Insurance Fund –- an insurer of last resort for employers in dangerous fields –- self-supporting.
Poizner expects to file the lawsuit in Sacramento County Superior Court. The defendants are Finance Director Michael Genest and State Treasurer Bill Lockyer.
— Kate Moser