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What is the status of the Cargill lawsuit?
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A:
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The entire Cargill
employee benefits class action has been settled through a series of
three settlements.
The first settlement was reached in May 2002. It provides relief
solely to those class members who had been employed by MWD as "district
temporary employees" (district temps or DTEs) and remained employed
as of February 3, 2002. This settlement is referred to as "the Partial
DTE Settlement".
The second settlement is class-wide and received court approval
on June 12, 2006. This settlement created a monetary fund to compensate
class members for certain non-pension employee benefits to
the extent that they did not already receive these benefits while
working at MWD. This second settlement covers annual leave/vacation
pay, holiday pay, merit pay increases, paid contingent leaves (e.g.,
personal leave, sick leave, disability leave, bereavement leave,
military leave and jury leave), severance pay, 401(k) contributions,
and health insurance premiums. It also provides class members who
remained employed by MWD with leave bank adjustments and long-term
former employees with reinstatement rights. This settlement is referred
to as "the Ad Code
Settlement".
The third settlement also is a class-wide settlement, and it received
court approval on January 29, 2008. This settlement addresses CalPERS
pension rights and is referred to as "the
CalPERS Settlement".
Each of these settlements required class members to file a claim
form (the Ad Code Settlement and the CalPERS Settlement) or to sign
an individual settlement agreement (the Partial DTE Settlement).
Class members who submitted Ad Code claim forms were not required
to submit CalPERS Settlement claim forms in order to participate
in the CalPERS Settlement. Approximately 2,000 class members have
opted to participate in one or more of the settlements. The time
for filing claims has passed.
Class Counsel now are engaged in representing these claimants in
a lengthy, interactive process with MWD and CalPERS to ensure that
they receive the relief to which they are entitled under these settlements.
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What is
required to implement the Cargill settlements? |
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A:
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The implementation of
the Cargill settlements involves the completion of a great
number of tasks, all of which are progressing concurrently. The tasks
include the following:
- Finalize a claimant database that has the most accurate information
available regarding each claimant's dates of employment and rates
of pay while providing services as a district temp, agency temp
and/or consultant. This process is hampered by a general failure
to maintain written records not only by MWD and the claimants'
employment agencies/consulting firms, but also by claimants themselves.
Before this information can be finalized, Class Counsel must reach
agreement with MWD on the applicable dates and pay rates or seek
a resolution of the dispute through arbitration.
- Develop information regarding the benefits already received
by claimants from a source other than MWD, such as an employment
agency or consulting firm, during their work at MWD.
- Determine whether any of the claimants are ineligible for relief
provided by the settlements because they are not within the scope
of the class of persons represented by Class Counsel in this case.
The class definition adopted by the Court excludes persons who
either: (1) received were regular employee benefits from the consulting
firms that paid them while working at MWD immediately prior to
and during their MWD employment; or (2) worked on a part-time
basis, i.e., a work schedule averaging fewer than 33 hours per
week. In cases where Class Counsel and MWD disagree on whether
a claimant falls within the class definition, the claimant's eligibility
will be resolved through arbitration.
** It should be noted that a determination that a claimant is
not a class member in the Cargill case is not
a determination that the claimant does not have a valid claim
for relief if he or she were to bring a separate lawsuit or to
initiate a separate CalPERS administrative claim. It simply means
that the claim was not resolved by this lawsuit.
- Determine whether certain claimants are subject to exclusion
from CalPERS benefits because they did not provide services to
MWD as common law employees of MWD. In cases where Class Counsel
and MWD disagree regarding a claimant's common law employee status,
the issue will be resolved by CalPERS through its administrative
process.
- Determine whether certain claimants are subject to exclusion
from CalPERS benefits because they were "limited term" employees
under the state law applicable to CalPERS, i.e., they were expected
to work, and did work, less than six months. In cases where Petitioners
and MWD disagree regarding this exclusion, the issue will be resolved
by CalPERS through its administrative process.
- Determine whether certain claimants are not entitled to relief
under the Ad Code Settlement because they truly were "temporary"
employees under the MWD Administrative Code, i.e., they were expected
to work, and did work, less than four months. In cases where a
claimant and Class Counsel disagree regarding this exclusion,
the issue will be resolved through arbitration.
Class Counsel's efforts during this lengthy and complex implementation
phase are dedicated to making sure that all qualified claimants
obtain the relief to which they are entitled under the Cargill
settlements. This effort also includes making sure that claimants
who are not qualified to obtain relief do not dilute the relief
available to qualified claimants.
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How can I verify that
I am considered a "claimant" under the Cargill settlements? |
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A:
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If you would like to know whether or not you are considered a "claimant,"
you should send an email to Class Counsel at mwdlawsuit@c-blaw.com.
We will confirm your status by a return email.
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How will it be determined
whether I should be excluded from participating in the settlement
because I am not a member of the Cargill class? |
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A:
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As mentioned above, certain
claimants will be found to be ineligible for relief under the Cargill
settlements because they do not fit within the class definition adopted
by the Superior Court in November 5, 1999. The class definition expressly
excluded two groups of workers, even though they may have provided
services to MWD as a district temp, agency temp or consultant:
- Those who never worked on a full-time basis. (See Answer to
Question 5, below.)
- Those who, immediately prior to their MWD employment, were
regular employees of the consulting firm under whose contract
they worked at MWD. (See Answer to Question 6, below
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How will it be determined
whether I worked on a full-time or part-time basis? |
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A:
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You worked on a full-time basis if you worked a schedule that would
result in providing services to MWD at least 1,720 work hours per
year. This is equivalent to a schedule requiring an average of 33
work hours per week or more.
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How will it be determined
whether I was a "regular employee of a consulting firm"? |
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A:
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You were a "regular
employee of a consulting firm" if:
- You were on the payroll of a consulting firm immediately
prior to providing services to MWD; this means that you had no
break in service or loss of wages between your non-MWD work and
MWD work;
- You were on the payroll of that same consulting firm while
providing services to MWD;
- The firm was genuine consulting firm, not an employment
agency, job shop or contract service provider;
- You either: (a) received the same rights and benefits as that
firm's most favorably treated employees with comparable experience,
education, training and skills, or (b) participated in
the firm's primary pension plan; and
- You received these same rights and benefits both before and
while you provided services to MWD.
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Am I entitled to a
receive a payment of money? |
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A:
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The Ad Code Settlement created a monetary fund to compensate class
members for certain non-pension benefits that they would have received
if MWD had been treated them as a "regular employee". The following
non-pension benefits are covered by this settlement: annual leave;
holiday pay; the average use by employees of personal leave, sick
leave, disability leave, bereavement leave, military leave and jury
leave; 401(k) contributions; health, dental, vision, life and long-term
disability insurance premiums; merit pay increases; and severance
pay.
Each qualified claimant is entitled to a pro rata share of this
fund based on the value of the benefits they did not already receive,
which is dependent on the claimant's length of employment, his or
her pay rate, and the value of the benefits already received by
the claimant from an employment agency, consulting firm or MWD.
The method for calculating each claimant's pro rata share is described
in much greater detail in the Description
of Damages Model for Administrative Code Claim.
Please note that the CalPERS Settlement requires a claimant's share
of the Ad Code Settlement monetary fund first to be used to pay
the claimant's share of the employee pension contributions owed
to CalPERS. This enables claimants to pay the CalPERS employee contributions
in pre-tax dollars.
Under the CalPERS Setttlement, claimants are responsible for depositing
at least 25% of the employee contributions attributable to their
MWD employment prior to January 1, 2001. (See Answer to Question
8, below.) If your share of the monetary fund exceeds the amount
to be deposited with CalPERS, the remainder will be paid directly
to you.
Those claimants who do not want to keep their employee contributions
on deposit with CalPERS will be able to withdraw these deposits
at a later date. The employee contributions that can be withdrawn
will include not only the claimant's 25% share of the pre-January
1, 2001 employee contributions that were paid from the settlement's
monetary fund, but also the employee contributions paid by MWD (75%
of the pre-January 1, 2001 contributions and 100% of the post-January
1, 2001 contributions).
As of April 30, 2008, the Ad Code Settlement monetary fund amounted
to $25,577,063.49. This fund is invested in tax-exempt municipal
bonds and is being monitored by the Los Angeles Superior Court through
the filing of quarterly reports.
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Who will pay the CalPERS
contributions if I am found to be entitled to CalPERS credit? |
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A:
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Under the CalPERS Settlement,
MWD may be required to pay a portion of the claimant's employee contributions
as well as the usual employer contributions. For most claimants, the
claimant will be responsible for paying 25% of the employee contributions
for CalPERS service credit attributable to employment prior to January
1, 2001, and none of the employee contributions for service credit
attributable to employment after that date.
However, claimants who received a form of retirement benefits from
an employment agency or consulting firm during some or all of their
MWD employment will be required to assume responsibility for paying
more of the CalPERS employee contributions. Those claimants who
already received employer contributions to a 401(k) plan while working
at MWD will be required to deposit with CalPERS the amount of those
employer contributions in addition to the 25% of the pre-January
1, 2001 employee contributions, but they will not be required to
deposit any increase in value of the 401(k) account resulting from
those employer contributions . Moreover, those claimants who participated
in a "defined benefit" pension plan while working at MWD will be
responsible for depositing with CalPERS all employee contributions
attributable to their MWD employment.
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I worked as a district
temp (DTE) and was not enrolled in CalPERS until 6 months or more
after I was hired. Will I get CalPERS service credit for my excluded
service? If so, who will pay the CalPERS contributions for this service
credit? |
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A:
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MWD was obligated to enroll you in CalPERS from the first day of
your employment unless, at the time you were hired to work
full-time, the length of your employment was genuinely expected
to be limited to 6 months or less. If, however, it was genuinely
expected that your full-time work for MWD would not exceed 6 months,
MWD should have monitored your employment dates and enrolled you
in CalPERS as soon as it was known that you would exceed 6 months
of full-time service.
Under the CalPERS Settlement, you are entitled to receive service
credit back to the date that you should have been enrolled in CalPERS,
and the employee contributions due for this time are subject to
the same 25%-75% split between you and MWD described above.
If you were properly enrolled in CalPERS as of a date later than
your first day of employment, you may wish to purchase CalPERS credit
for the properly excluded time as "membership prior to service".
If so, you should contact CalPERS.
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I already purchased
service credit for my "temp" time. Can I get a refund for the employee
contributions MWD has agreed to pay under the Cargill settlement? |
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A:
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Yes. You are entitled to a refund. Please make sure you inform
Class Counsel that you purchased this service credit.
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If I worked
for MWD for fewer than 5 years and do not expect to vest a CalPERS
pension by working at another public agency, do I still have to deposit
money with CalPERS? |
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A:
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Yes. You are entitled to a refund. Please make sure you inform
Class Counsel that you purchased this service credit.
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Can I receive CalPERS
service credit for my part-time service? |
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A:
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The Cargill case addresses only your full-time employment,
even though you may be eligible for CalPERS service credit for your
part-time service with MWD or some other public agency. As a general
rule, you will have to seek credit for part-time service directly
from CalPERS on your own. However, there are a few exceptions for
claimants who have part-time service in addition to one or more
full-time tenures with MWD.
If you qualify to receive CalPERS credit through the CalPERS
Settlement for one or more full-time tenures with MWD and you have
part-time service to MWD that falls into one of the categories outlined
below, you also will be able to obtain service credit for that
part-time service through the settlement.
- The first exception is for qualified claimants with part-time,
common-law employment with MWD that took place after the
claimant's CalPERS enrollment date, whether or not that enrollment
date was established through the CalPERS Settlement. MWD has agreed
to pay the same 75% and/or 100% of employee contributions (subject
to offsets) as it has agreed to pay for full-time employment starting
with the first day of the part-time employment that falls in this
category.
- The second exception is for qualified claimants with part-time,
common-law employment with MWD (1) that took place prior
to the claimant's CalPERS enrollment date for full-time employment,
and (2) for which MWD has confirmed that there is a hiring requisition
stating that the position was expected to last at least one year
for an average of at least 20 hours per week. MWD has agreed to
pay the same 75% and/or 100% of employee contributions starting
with the first day of the part-time employment that falls in this
category.
- The third exception is for qualified claimants with part-time,
common-law employment with MWD (1) that took place prior
to the claimant's CalPERS enrollment date for full-time employment,
and (2) for which MWD has confirmed that the class member worked
more than 1,000 hours within any fiscal year (July 1 - June 30)
during the period of part-time employment. MWD has agreed to pay
the same 75% and/or 100% of employee contributions starting the
first day of the first pay period of the month following the month
in which 1,000 hours of service in a fiscal year were completed.
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When can
I expect to receive my settlement money? Why is it taking so long?
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A:
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The distribution of the Ad Code monetary fund to qualified claimants
will be the last step of the settlement implementation. Before each
qualified claimant's pro rata share can be calculated, there must
be a final resolution of: (1) which claimants are eligible for this
relief; (2) the eligible claimant's employment dates and pay rates;
and (3) the benefits already received by eligible claimants from
employment agencies and consulting firms. The time required to resolve
these issues will be depend on how many contested issues must be
resolved through arbitration or the CalPERS administrative process.
(See Answer to Question 2, above.) At this
time, it is impossible to give a meaningful estimate of the time
that will be required to get final resolution on all of these matters;
however, based on the number of issues that still need to be resolved
for individual class members, it is very likely that the earliest
date the distribution could take place is the end of 2009.
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How much
money can I expect to get? |
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A:
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This question also can not be answered at this time. Each qualified
claimant will receive an unknown percentage of their lost non-pension
benefits as calculated by the above-referenced damages model. This
percentage is dependent upon the total of all damages for all qualified
claimants and the final amount in the monetary fund at the time
of the final distribution.
For example, if there is $25 million to be distributed to qualified
claimants and the total value of those claimants' non-pension benefits
(as calculated by the damages model) is $100 million, each claimant
would receive 25% of the value of his or her lost non-pension benefits.
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Will attorneys'
fees be deducted from my settlement check? |
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A:
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The Court already has determined the amount of attorneys' fees
to be paid to Class Counsel. The fees related to the Ad Code Claim
already have been paid from the overall monetary fund created by
the Ad Code Settlement. The fees related to the CalPERS Claim are
being paid by MWD, not by members of the class. There will not be
any further deductions from the monetary fund or from class members'
settlement checks to pay fees to Class Counsel.
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Will any
of the fees paid by participants in the Partial DTE Settlement be
refunded? |
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A:
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No. Class Counsel placed this issue before the Court in connection
with its motion for an award of attorneys' fees and costs for the
Ad Code Claim. The Court considered the monetary value of the relief
obtained for the Partial DTE Settlement and the Ad Code Settlement
participants and then ruled that the fees paid by class members
who benefitted from the Partial DTE Settlement were proportionate
with the fees being paid by the other class members by having their
relief reduced by the amount of the fees that were deducted from
the Ad Code Settlement monetary fund. Accordingly, the Court refused
to apportion any part of the monetary fund created by the Ad Code
Settlement to reduce these fees.
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Will I
be reimbursed for the money I paid to buy medical and dental insurance
during the time I worked for MWD? |
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A:
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No. However, one of the factors in determining the amount of your
pro rata share of the Ad Code Settlement monetary fund will be the
cost of the insurance premiums that MWD would have paid for you
if you had been classified as a regular employee.
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I am about
to retire. Can I have my CalPERS claim expedited? |
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A:
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Yes. Please contact Class Counsel as soon as you decide to retire.
The MWD and CalPERS have agreed to give priority to processing the
CalPERS claims of those claimants who already have retired or are
planning to retire. Class Counsel and MWD will have to reach agreement
on your dates of employment as a district temp, agency temp and/or
consultant as well as your rates of pay during those time periods.
You can help move the process forward by sending Class Counsel copies
of any documents you have or can obtain that provide such information.
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Can I
draw a pension from CalPERS and also collect social security payments? |
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A:
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Yes. There may be a reduction to your social security payment,
but the combined payments should exceed the social security payment
alone. See the Social
Security Administration's Windfall Elimination Provision for
details. If you have further questions you should contact the Social
Security Administration and/or CalPERS
for more information.
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Am I eligible
for CalPERS retiree heathcare? |
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A:
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To be eligible for CalPERS retiree healthcare, (1) you must have
at least five years of CalPERS service credit, and (2) you must
retire with an effective date no later than 120 days following the
date of your separation from your CalPERS employer. If you are eligible,
you may enroll for retiree healthcare as an annuitant within 60
calendar days of receipt of the notification of your eligibility
or during any open enrollment period.
CalPERS has interpreted these statutory requirements as binding
on you even if you were not aware at the time you left your employment
with MWD that you later would obtain, through the Cargill
lawsuit, sufficient CalPERS service credit to enable you to seek
a retirement allowance and retiree healthcare from CalPERS. However,
if you obtain employment in the future with another CalPERS agency
or the State of California, you may be eligible for retiree healthcare
when you separate from that employment if you have five years or
more of CalPERS service credit, including the service credit you
obtain through the lawsuit for your work at MWD.
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I currently
am a member of CalPERS. I previously tried to sign up for CalPERS
Additional 5-Year Service Credit Plan that would allow me to purchase
extra service credit toward retirement ("air-time"), but CalPERS told
me that I needed to have 5 years of existing service credit to be
eligible for the Plan. If my formerly excluded district temp, agency
temp and/or consultant time had been counted, I would have had the
necessary five-years of service credit, and I would have been able
to purchase the additional five years credit based on my salary at
the time when I made the inquiry. When I finally receive credit for
my "temp" time, will I be able to purchase air-time at a rate based
on what my salary was at the time I first would have been able to
purchase it if MWD had correctly given me credit for my "temp" time?
I hope the answer is yes, because purchasing the credit will be much
more expensive if I am forced to buy the additional credit at the
higher rate based on my current salary. |
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A:
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The Cargill settlement does not alter the statutory requirements
related to this specific issue. CalPERS takes the position that
CalPERS is required by California state law to set the cost of purchasing
any air-time based on the person's wage rate at the time of the
purchase.
CalPERS has indicated that claimants will be considered eligible
to purchase "air-time" so long as: (1) they have at least five years
of service credit already granted by CalPERS; (2) they are in compensated
employment with a CalPERS agency at the time of the request; and
(3) they have not previously purchased any air-time. Claimants who
will not have five years of service credit until they receive additional
service credit through the Cargill settlement will be unable
to purchase air-time until that time.
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How will
CalPERS enrollment/adjustment affect me if I already am receiving
payments from another retirement system? |
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A:
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You should contact the pension administrator for the other retirement
system or your local CalPERS office to get an answer to that question.
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How do I contact CalPERS?
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A:
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If you have a question that relates to the service credit being
obtained through the Cargill settlement, you should contact
Class Counsel. These questions require a knowledge of the Cargill
settlement and are being passed to CalPERS through the attorneys
who have represented CalPERS in the Cargill lawsuit.
f your question involves matters outside the Cargill lawsuit,
many question can be answered through CalPERS's website www.calpers.ca.gov
or by calling CalPERS at 1-888 CalPERS (or 1-888-225-7377). You
also can visit one of CalPERS' local offices; for most class members
it will be one of the following:
Glendale Regional Office
Glendale Plaza
655 North Central Avenue, Suite 1400
Glendale, CA 91203
Counties Served: Los Angeles, Santa Barbara and Ventura
San Bernardino Regional Office
50 East Hospitality Lane, Suite 330
San Bernardino, CA 92408
Counties Served: Inyo, Riverside and San Bernardino
Orange Regional Office
500 North State College Blvd., Suite 750
Orange, CA 92868
County Served: Orange
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