The State Worker

CalPERS hires attorney from pension lawsuit that strikes fear in state workers

Ashley Dunning brought some baggage to a job interview Wednesday at the California Public Employees’ Retirement System.

She was one of two finalists for an assignment as a special counsel to the CalPERS Board of Administration, where she’d advise board members on conflicts of interest and their fiduciary responsibilities. She’s the board’s acting fiduciary counsel, and she delivered a top-notch presentation that had board members ready to offer the job on a longer contract.

The hang-up for some board members, however, is that she’s the attorney representing Marin County in a lawsuit striking fear in public employees around the state.

Her side is defending the county’s interpretation of a law aimed at ending pension spiking. The case gained a broader scope in August when an appeals court used the lawsuit to rule that public workers are entitled to a “reasonable pension,” but not necessarily one that’s calculated on the most favorable formula for them.

Those words could undermine the “California rule,” the precedent that promised pension benefits cannot be reduced. The case is on its way to the state Supreme Court.

“The California rule is very, very, very important to the people we represent,” CalPERS board member J..J. Jelincic said before he voted against offering Dunning’s firm a contract.

Dunning was ready for the board’s questions. She said she “very strongly” favors the California rule and that the Marin County case is not meant to challenge it. She said the appeals court went beyond her side’s argument when it issued its ruling.

Dunning’s firm, Nossaman, won the CalPERS contract and will work with the board at a rate of $550 an hour. The Nossaman team was helped by its competitor, Seyfarth Shaw, whose lead attorney was badgered by CalPERS board member Richard Costigan until the lawyer acknowledged that he opposes the California rule.

Adam Ashton: 916-321-1063, @Adam_Ashton. Sign up for state worker news alerts at