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Old January 21st, 2011, 11:17 AM   #1
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U.S. Judge allows gay and lesbian couples' lawsuit against CalPERS to proceed

Bay City News Service

Posted: 01/20/2011 07:05:47 AM PSTUpdated: 01/20/2011 07:19:47 AM PST

Three married gay and lesbian couples in which one partner is a state employee have won an important step in their fight for the equal right to buy long-term care insurance from the state's pension system.

In a ruling issued on Tuesday, U.S. District Judge Claudia Wilken of Oakland said the couples can proceed with a lawsuit they filed in April against the U.S. Treasury Department and the California Public Employees' Retirement System, known as CalPERS.

Wilken said that two federal laws used to deny the same-sex spouses the right to buy long-term care insurance "do not bear a rational relationship to a legitimate government interest."

The two laws are the Defense of Marriage Act, or DOMA, which bars federal recognition of same-sex marriage, and a section of the Internal Revenue Code that prohibits same-sex spouses from receiving favorable tax treatment for insurance plans.

Wilken did not explicitly strike down the DOMA law, but said it could not be used as a basis for dismissing the lawsuit.

She turned down a bid by the U.S. Justice Department for dismissal and said the case can go to trial.

Several other challenges to DOMA are pending in other U.S. courts, including a ruling in which a federal judge in Boston overturned the measure. That decision is now on appeal.

The three couples in the CalPERS lawsuit - Michael Dragovich and Michael Gaitley, Elizabeth Litteral and Patricia Fitzsimmons, and Carolyn Light and Cheryl Light - were married during a five-month window in 2008 when same-sex marriage was legal in California. One member of each couple works for the University of California, San Francisco Medical Center and is therefore a state employee.

But CalPERS has refused to make its long-term care insurance plan available to the employees' spouses on the ground that the two laws would prevent the spouses from receiving favorable tax treatment.

Future long-term care benefits are exempt from taxation, and in some cases the insurance premiums are tax-deductible.

The employees' spouses could buy long-term care insurance elsewhere but say they prefer the popular CalPERS plan.

Claudia Center, a lawyer for the plaintiffs, called Wilken's decision "a key legal victory" and said the couples hope to use the case to make the CalPERS insurance available to all same-sex spouses and domestic partners of state workers.

Center said the plaintiffs' next steps will be to seek to add two same-sex domestic partners to the case and have the lawsuit declared a class action. She said that sometime this summer, the plaintiffs will ask Wilken to issue a summary judgment in their favor without a trial.

A spokesperson for CalPERS was not available for comment today.
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