Wed July 16, 2014
In Lawsuit Response, Kentucky Pension System Argues Investments Were Legal
The troubled Kentucky Retirement Systems pension is firing back at a lawsuit filed by a small Northern Kentucky town over what it alleges are “high risk investments."
In June, the city of Fort Wright — population 5,700 —filed a lawsuit against KRS over investments into Wall Street hedge funds with public money, seeking $50 million to cover the losses and to divorce its city and county employees from the state system.
KRS responded with a motion last week claiming that the city lacks the proper legal standing to file the suit. KRS asked a Kenton Circuit judge to dismiss the claim.
Specifically, KRS argues that the types of alternative investments it makes into hedge funds are allowed by state law, and that circuit court is an improper venue for the suit because it is an administrative agency.
KRS’ motion will be heard Monday in Kenton Circuit Court.