From ORTA: Ohio teachers pension board members sue Attorney General Dave Yost over legal fees

Ohio teachers pension board members sue Attorney General Dave Yost over legal fees

Writer: ORTA 

August 15, 2025

Two former STRS Ohio board members are suing Ohio Attorney General Dave Yost over legal representation in a lawsuit against them.*

What happens when your lawyer sues you and he gets to pick which attorneys can defend you and how much they should get paid?

State Teachers Retirement System of Ohio Board Chairman Rudy Fichtenbaum and former Board Member Wade Steen are suing Ohio Attorney General Dave Yost over just that question.

In May 2024, Yost sued Fichtenbaum and Steen, accusing them of violating their fiduciary duty to act in the best interest of the public pension system.

The Ohio attorney general is the lawyer for STRS and its board members. If outside counsel is hired to represent the state on any matter, it's the attorney general whomakes that call.

But Steen and Fichtenbaum hired their own legal team to represent them and sent their legal bills to Yost for payment. The attorney general's office declined to cover the bills and asserted that Yost would pick their lawyers and determined how much they should be paid, according to a new lawsuit filed Franklin County Common Pleas Court.

Steen and Fichtenbaum balked at this arrangement. Their legal team sued Yost. It's the latest dramatic twist at STRS, the state's second largest public pension system. The board oversees $95 billion invested on behalf of 500,000 retirees and teachers.

The fund has faced historic turmoil in recent years that has included top manager departures, anonymous memos, multiple lawsuits and an ethics investigation.

The turmoil prompted state legislators to revamp the pension board. STRS Ohio is currently governed by an 11-member board of four appointed financial experts, five teachers and two retirees. Teachers and retirees will lose their majority, and power will shift to financial experts appointed by politicians.

STRS is one of five public pension systems in Ohio. Combined, the five systems have about $225 billion invested for 655,000 public employees, 486,000 retirees and 1.1 million former government workers.

Public employees in Ohio aren't in the Social Security system, so the pension funds are their primary retirement money.

Read this article online at https://www.dispatch.com/story/news/state/2025/08/15/strs-ohio-pension-board-chair-sues-ohio-attorney-general-dave-yost/85665537007/ 

*Correction:  Rudy Fichtenbaum is not a former STRS Ohio Board member. He is currently the Chairman of the STRS Ohio Retirement Board.

STRS Ohio Board member Rudy Fichtenbaum and former Board member Wade Steen are incurring legal fees, defending themselves against the lawsuit brought against them by Ohio Attorney General Dave Yost. As you might imagine, the cost to defend a person from attack by the two most powerful people in the state is tremendous. ORTA will use donations from the Pension Defense Fund to help them pay their legal expenses. Help us fight for your pension by donating to ORTA's Pension Defense Fund. Make a donation today to the ORTA Pension Defense Fund

Related posts: Ohio AG files lawsuit to remove two state teachers' pension board members

Court document filed 8/14/2025: Rudy Fichtenbaum and Wade Steen vs Dave Yost

 

Teachers retirement board members sue Ohio attorney general

 nbc4i.com News

Columbus

August 15. 2-25

Teachers retirement board members sue Ohio attorney general

by:  Kevin Accettulla, Colleen Marshall

Posted: Aug 15, 2025 

COLUMBUS, Ohio (WCMH) — The chairman of the State Teachers Retirement System board and a former member filed a lawsuit Thursday against Ohio Attorney General Dave Yost for allegedly refusing to provide them with legal representation in a previously filed lawsuit.

Rudy Fichtenbaum and former member Wade Steen claim that when Yost sued them in 2024, he failed to provide them with legal representation, as required by Ohio law when sued in connection with their roles with STRS.

The pair claims they hired their own legal representation and were reminded that Yost was obligated to provide them counsel. They contacted Yost’s representatives asking the state to pay for the lawyer fees.

“Without explanation, [Yost] indicated he would not pay the fees for their lawyers,” according to the lawsuit. “Instead General Yost insisted that he would himself select counsel to oppose him in that case, selecting from among the several lawyers who he had worked with previously.”

Yost selecting his opponents and determining how much they would be paid is “unethical, improper and illegal,” the lawsuit states, so they refused the proposal.

“The conduct of [Yost] is intended to disadvantage [Fichtenbaum and Steen] in that such conduct deprives [Fichtenbaum and Steen] of their right to due process of law,” the lawsuit states.

In a statement to NBC4, the attorney general’s office said STRS has insurance for defending its board members.

“The AG’s officer offered both Steen and Fichtenbaum outside counsel through their insurance carrier,” the spokesperson said. 

“Both of them refused this counsel and insisted on their own private counsel. The state never pays bills for private counsel hired by state employees. In this case there was an insurance policy to cover attorney fees for these two individuals, through approved counsel. There is an established process for paying the attorney bills in this situation. Just because they don’t like the process doesn’t mean they get to make the state, through the taxpayers, pay for their private attorneys.”

Fichtenbaum and Steen are seeking unspecified damages.

Read the article online here: https://www.nbc4i.com/news/local-news/columbus/teachers-retirement-board-members-sue-ohio-attorney-general/ 

Video for above article

 https://www.youtube.com/watch?v=8CkSHLvqAHw 

Ohio teachers pension board members sue Attorney General Dave Yost over legal fees

Two former STRS Ohio board members are suing Ohio Attorney General Dave Yost over legal representation in a lawsuit against them

By Laura A. Bischoff

Columbus Dispatch

August 15, 2025

Key Points AI-assisted summary

•  Yost sued the board members for alleged breach of fiduciary duty, and they hired their own lawyers, whose fees Yost refused to pay.

•  The lawsuit is the latest development in ongoing turmoil at STRS Ohio, including management changes and investigations.

•  STRS Ohio manages $95 billion for 500,000 members and is undergoing a board restructure.

What happens when your lawyer sues you and he gets to pick which attorneys can defend you and how much they should get paid?

State Teachers Retirement System of Ohio Board Chairman Rudy Fichtenbaum and former Board Member Wade Steen are suing Ohio Attorney General Dave Yost over just that question.

In May 2024, Yost sued Fichtenbaum and Steen, accusing them of violating their fiduciary duty to act in the best interest of the public pension system.

The Ohio attorney general is the lawyer for STRS and its board members. If outside counsel is hired to represent the state on any matter, it's the attorney general who makes that call.

But Steen and Fichtenbaum hired their own legal team to represent them and sent their legal bills to Yost for payment. The attorney general's office declined to cover the bills and asserted that Yost would pick their lawyers and determined how much they should be paid, according to a new lawsuit filed Franklin County Common Pleas Court.

Steen and Fichtenbaum balked at this arrangement. Their legal team sued Yost.

It's the latest dramatic twist at STRS, the state's second largest public pension system. The board oversees $95 billion invested on behalf of 500,000 retirees and teachers.

The fund has faced historic turmoil in recent years that has included top manager departures, anonymous memos, multiple lawsuits and an ethics investigation.

The turmoil prompted state legislators to revamp the pension board. STRS Ohio is currently governed by an 11-member board of four appointed financial experts, five teachers and two retirees. Teachers and retirees will lose their majority, and power will shift to financial experts appointed by politicians.

STRS is one of five public pension systems in Ohio. Combined, the five systems have about $225 billion invested for 655,000 public employees, 486,000 retirees and 1.1 million former government workers.

Public employees in Ohio aren't in the Social Security system, so the pension funds are their primary retirement money.

Read this article online here. 

State government reporter Laura Bischoff can be reached at lbischoff@gannett.com and @lbischoff on X.

Trina Prufer: At what point does “sustainability“ turn into “unjust enrichment”?

From Trina Prufer

August 13, 2025

At what point does “sustainability“ turn into “unjust enrichment”?

At what point does the “sustainability” rational turn into “unjust enrichment” of the STRS system? How many yachts does a senior employee need? 

In 2012, the State of Ohio used its police powers to negate the defined-benefit obligation of a 3% annual automatic COLA for retirees, claiming there was no other way to ”sustain“ the fund. The consequences of this legislation were predictably dire for older retirees, as without Social Security and time to plan for a second income stream, many would drift into poverty. In fact, this has happened and disproportionately affects the aged and most vulnerable, as a greater proportion of income is spent on basic needs.

As compared to many other public pension systems in the same predicament after the 2008 recession, STRS chose a particularly unique and harsh solution to its budgetary shortfall. STRS is an outlier in not taking into consideration the diminishment of the benefit over time. The fiscal analysis accompanying the bill does not address its effects on members.

During this same period of time, STRS, the pension system, has prospered and provides one of the best compensation packages in the country for its own employees. In reality, much time is spent at monthly board meetings touting the superiority of its investment staff, rationalizing bonuses and looking at compensation studies on how much its employees should be paid. You would never know STRS is a public pension system that is so underfunded that it cannot (or will not) pay what it owes to members.

At what point does the “sustainability” rational turn into “unjust enrichment” of the STRS system? How many yachts does a senior employee need? The monthly board agenda NEVER seems to address the basic questions of equity, fairness and purpose of a public retirement system. If STRS creates poverty, by taking more than it gives back ( 14% contribution rate; 11% normal cost)  why does it exist?

James Carr: I cannot imagine a public pension that that treats its members with less respect than STRS.

From James Carr

August 13, 2025

A defined benefit pension without a COLA is not a fixed income, it's a declining income that eventually results in poverty.

I remember, 17 years ago when I was meeting with an STRS retirement counselor, he told me that the 3% annual COLA was more than a benefit, it was a lifeline that would prevent me from sinking into poverty in my old age. He was, of course, 100% correct in his assertion. 

The problem is he neglected to mention one very important caveat. In the alternate universe of STRS, there is no such thing as a defined benefit pension because in a defined benefit plan you know exactly what the benefits are. There are no surprises. The whole purpose of a defined benefit plan is to eliminate risk. Surprise.

It amazes me that STRS will move Heaven and Earth to make sure that employees will receive their 6 digit bonuses and annual raises, but when it comes to the COLAs that were an integral part of the defined benefit plans, tough luck.

I cannot imagine a public pension that that treats its members with less respect than STRS.

Trina Prufer on STRS: "... a public retirement system that puts its membership into financial peril, and does not fully disclose the inadequacy of the benefit, is a malevolent institution.

From Trina Prufer

August 11, 2025 

Pension Adequacy and Unjust Enrichment 

Every day I ponder the plight of STRS members and know in my heart that none of this is fair or normal for a public retirement system. The human costs of 2012 “pension reform” are far beyond what other systems have done to maintain sustainability. 

We know that STRS is an outlier because it takes more from members than it gives back. In effect, it has a license to steal. But what are the moral, ethical and legal arguments?  

When viewed from the vantage point of a typical classroom teacher, the pension benefit is not ADEQUATE to sustain life in old age. Pension adequacy (70% replacement) is the gold standard of public pensions. If the lifespan of a typical teacher is 28 years in retirement, the defined-benefit diminishes into the 30-40% (or lower) replacement range. Social Security alone is designed to replace about 40% throughout the lifespan and has an automatic COLA tied to inflation. Without inflation protection, the STRS defined benefit is a humanitarian disaster engineered by the State of Ohio. How does that serve the needs of the public, which was the rational for “pension reform” in the first place? 

By taking more from educators than the defined benefit is worth, has STRS drifted into the realm of “unjust enrichment”?   In other words, what gives the STATE the authority to extract wealth from teachers just for the privilege of becoming a teacher? 

 If STRS offers no financial benefit to members over Social Security and investing a similar amount in a 401 K, what is its purpose? We need to request that a modeling study be done to answer this very question. Furthermore, a public retirement system that puts its membership into financial peril, and does not fully disclose the inadequacy of the benefit, is a malevolent institution. Is the State of Ohio unjustly enriching itself? Perhaps that is an issue the courts need to decide.