IATSE 3rd 2019_web

positioned to withstand a serious economic
downturn and will likely outperform
while being 40% less volatile than
our peer portfolios. The expected return
is 0.6% above peers with a significantly
lower equity allocation. The primary
reason for the better return-risk ratio for
the pension versus our peer portfolio is
because of the lower equity and higher
alternatives allocations.
ARIS Investments summarized the
study in six key takeaways. The pension
has a long-term objective to achieve
7.5% average net return with as little risk
as possible. Risk is measured by volatility
and probability of material loss. The
Plan is currently structured to meet this
objective. The Pension’s expected return
is higher and volatility lower than the
typical peer portfolio and the odds of
material loss are markedly lower based
on simulations going back to 1926. The
primary reason the plan is more efficiently
allocated than its peers is because
it is more diversified. This doesn’t
mean defensive. In fact, over 80% of the
assets are invested to have an equity-like
return. The pension is structured to produce
better performance (higher return/
lower risk) than equity-concentrated
peer portfolios over the long term. Due
to a lower equity allocation, it is likely to
underperform during strong equity markets
and outperform during economic
downturns.
President Loeb thanked the Directors
for their report, noting that the Plans
continue to grow as the combined hours
continue to exceed projections. President
Loeb noted that the stress test is significant
because it indicates that, in the event
of a market downturn, the Plans will
continue to be in good shape. President
Loeb concluded his remarks by thanking
the Directors for their hard work.
NU IMAGE
General Counsel Samantha Dulaney
and West Coast Associate Counsel Jacob
J. White reported to the Board on Nu
Image v. IATSE.
General Counsel Dulaney noted that
the facts of this case are extremely esoteric
but at its most basic the case involved
a dispute over Nu Image’s obligation to
pay residuals on their productions.
Despite clear language in the contracts
requiring them to do so, Nu Image
did not pay any residuals to the Motion
Picture Industry plans from 2006 to
2013. The MPI subsequently sued Nu
Image for delinquent contributions. Nu
Image then turned around and sued the
IATSE, claiming that the International
made negligent, or intentional misrepresentations
during bargaining. Nu Image
claimed that it relied on the representations
of the International that it would
not have to pay residuals. It sought indemnification
from the International,
essentially demanding that the International
pay the residuals on their behalf.
The International disputed these patently
false claims.
The International was confident
throughout the litigation that Avi Lerner
and Nu Image had no legal, or factual,
basis for their lawsuit. The case percolated
up from the California federal district
court to the Ninth Circuit Court of
Appeals, and finally to the United States
Supreme Court. The International prevailed
at every step, from summary judgment
at the District Court, to confirmation
of summary judgment by the Ninth
Circuit, and, finally, to the Supreme
Court’s decision to deny review. The case
is now over.
General Counsel Dulaney thanked
David Rosenfeld, Bill Sokol, Michael
Burstein, Lisl Soto, Roberta Perkins,
and Monica Guizar from the Weinberg,
Roger & Rosenfeld law firm, and Counsel
White, for their work on the case.
President Loeb thanked General
Counsel Dulaney and Counsel White
for their report, remarking that it is important
for the members to hear reports
like this so they know that the International
will battle employers all the way
to the Supreme Court when they know
the battle is important. This employer
did not want to pay residuals, which fund
the health and pension plans for IATSE
members, and the IATSE will never back
down in fighting for what is right.
OSBURN VS. IATSE
SUPREME COURT CASE
General Counsel Samantha Dulaney
and West Coast Associate Counsel Jacob
White gave the Board a status report concerning
litigation filed in 2014 by Brother
James Osburn and Sister Elizabeth Alvarez
against the IATSE International,
President Loeb and International Vice
President Michael F. Miller, Jr. The facts
and background of the litigation have
been set forth in previous Bulletins and
in the Proceedings of the 2017 Quadrennial
Convention.
Local 695 was placed into trusteeship
in February of 2014 for violating the
IATSE International Constitution. As a
result of the receivership, all officers of
Local 695 including Brother Osburn and
Sister Alvarez were removed from their
positions as Local officers. Some employ-
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