The case of the preemptive strike and the wronged widow

A sudden death takes a widow and her attorney into the battlefield of uncertainty.

A sudden death takes a widow and her attorney into the battlefield of uncertainty.

Vladimir Volodin/Shutterstock.com

By David Hodes

Jackie Hillman will never forget the worst weekend in her life.

It was July 28, 2008. The then 61-year-old Clarendon mother of two watched her husband of six years, Bronx native and retired government worker 66-year-old Warren Hillman, suddenly die from acute myeloid leukemia at Inova Fairfax Hospital. “He went into the hospital on a Saturday and died on Monday,” she says. “It was really a nightmare situation. I was devastated.”

A few weeks later, Warren’s ex-wife, Judy Maretta, who Jackie had never met, contacted her. Maretta had heard about Warren’s death, though she didn’t attend the funeral. She suggested they meet for lunch, talk about Warren, maybe help her through this terrible experience. “I thought maybe we could become friendly,” Hillman says. At the lunch, Maretta asked her what had been the most difficult part of the tragedy besides the loss. “And I said waiting for the life insurance.”

But Maretta had another agenda for that lunch. She was checking on what Jackie knew about her husband’s money. “She already knew that she was applying for that check,” Hillman says, even though the property agreement in the divorce settlement Maretta and Warren worked out in early 1998 included a clause that they would not touch each other’s federal benefits.

Illiustration by Art Lien.

Back then, he sent the property settlement and the divorce decree to the Office of Personnel Management as they instructed, and asked them to take Maretta’s name off of everything, he told Hillman. “And the other thing that my husband told me was that if anything ever happened to him, that I should use the life insurance money to pay off the mortgage on the house,” she says. “Other than that, I wasn’t going to receive any other federal benefits.”

Warren had been a government employee most of his life, first as an urban planner for Rockville when he moved to the area in 1973—he worked on the design and location of the Rockville metro station. Then he took a job with the Office of Management and Budget in 1979 before transferring to the General Services Administration, where he met and married Maretta in 1989. He retired in 1997. In 1998, he and Maretta divorced.

After his death, Hillman was waiting on the OPM to process her insurance check from her husband’s Federal Employees’ Group Life Insurance (FEGLI) plan. She was told that it would take five months. But her husband, a “pack rat who saved everything” apparently didn’t finalize one important detail after the divorce from Maretta that would come back and haunt his widow. He assumed that Maretta’s name would be removed as life insurance beneficiary per his correspondence with the OPM. It wasn’t. And he didn’t redesignate anyone else.

A year after that lunch, plenty of time for Maretta to tell Hillman what was going on, and with Hillman still waiting for word from the OPM, she learned that her claim had been rejected. Maretta, the woman who stunned Warren Hillman one day with the bulletin that she was attracted to other men and then left him, got the money Hillman thought was hers—$124,558.03 —just three months after Warren Hillman died.

Hillman called her to confirm it. “And she said, ‘Well it just didn’t get done, so legally, it’s all mine.’ That’s what she said. And I felt very betrayed.”

Hillman had been struggling since her husband’s death. She was still working the part-time student services job at Northern Virginia Community College that she had before her husband’s death, had taken out her social security and got hit with an early withdrawal penalty and had to sell her house to make ends meet. She thought settlement money would be coming to the rescue.

She tried to get a full-time job at the college, but this was 2008 and there was a hiring freeze. And she quickly realized that she was not ready to work full time anyway. The feeling of grief was strong, she said, and she needed some downtime.

When she found out that Maretta was awarded the money she expected, Hillman sued Maretta. She needed the money. And she wanted answers. Why, if Maretta divorced her husband and had agreed to a property settlement about not touching federal benefits, did she get her husband’s money?

That question would be one of many heard in oral arguments before the U.S. Supreme Court on a bright sunny morning in this past April.

Never in her wildest dreams did Jackie Hillman think she would be a litigant sitting in the U.S. Supreme Court. Her attorney, Dan Ruttenberg, a principal with SmolenPlevy law firm in Vienna, really didn’t belong there either, arguing this case in the highest court in the land.

Ruttenberg isn’t a trial lawyer. He’s a transactional attorney, doing estate planning and tax law. Any litigation he’s done has been small potatoes—landlord disputes and the like. In fact, the first case he litigated happened when he was in law school, in a dispute with Micro Center over a computer he purchased. The company spent thousands on the case, hiring a large law firm and flying in witnesses to fight this uppity law student. He won.

Even before he passed the bar, he had faced long odds in the courtroom and won. Ruttenberg was a fighter.

So here they were, these two out-of-place people—a wronged widow and a determined attorney—presenting a case that had less than 1 in 100 chance of even getting to the Supreme Court, facing a team of trial lawyers working for Maretta who had appeared before the court and argued cases there many times before.

It had been a four-year odyssey getting here, where this dispute would now be argued in these hallowed halls. But it started out as, well, small potatoes.

This family law/divorce case originally seemed like a slam dunk to Ruttenberg because there was a Virginia state statute right on point. Divorced spouses don’t get death benefits. When he learned about the case in 2009, he talked his partners into letting him take it on. “I was looking for a side project,” he says.

Daniel Ruttenberg in front of U.S. Supreme Court during the trial. Photo courtesy of Debra B. Scheinberg.

But state laws vary on marriage and divorce issues like this one, so there were potential trap doors on both sides. Issues regarding federal law being higher order than state law in marriage and divorce had been heating up in the shadow of the Defense of Marriage Act. And state courts routinely decide issues of federal law. But there would be more confusing lawsuits to come in some states, more government employees getting divorced, and the courts were looking to get some certainty established on the issue now more than ever.

Ruttenberg’s little “side project” was about to become a significant milestone achievement in his career, resulting in an important decision by the U.S. Supreme Court that had far-reaching implications in family law about who owned what and why.

The case went to Fairfax County Circuit Court on May 7, 2010, where Ruttenberg knew the judges. He had even been past president of the Fairfax Bar. This was good. He had discovered that federal courts would likely find for preemption and state courts would not.

He won. Judgment was granted to Hillman on July 25, 2010, high fives all around, but the case was far from over.

George Peterson, founding partner of the Peterson Saylor law firm in Fairfax, the opposing counsel, and an accomplished trial lawyer who specializes in appeals, was just getting warmed up. “I don’t take losing very well,” he says. He appealed the case to the Virginia Supreme Court, a court that takes very few cases. They took it instantly, giving Ruttenberg his first insight into how big a deal this case was, and how much work he had ahead of him.

On January 13, 2012, that court reversed the Fairfax County Circuit Court’s decision. Ruttenberg lost. He was down but not out.

“A circuit court judge gave me some advice that kept me going,” Ruttenberg says. “He said ‘Look, if you gotta die, die a glorious death.’” Ruttenberg appealed the case to the U.S. Supreme Court. The court decided to take it. “I am very stubborn, because I can’t let go or back down from a fight,” he says. “If I am going down, I am going down swinging as hard as I can.”

He went into full attack mode preparing for the oral argument. He did two moot (or practice) courts during the week before—one through the nonprofit D.C.-based Public Citizen’s Supreme Court Assistance Project, and one at Georgetown’s moot court program. They are considered the top two moot courts in the country. “Those guys killed me, they just crushed me,” he says. “It was emotionally draining.”

He took the weekend to recover. By the time he got to the Supreme Court in front of the nine justices on the morning of April 22, 2013, he was relaxed, confident, ready.

Ruttenberg was up first. In seconds, Justice Antonin Scalia went on the attack. “I was not happy about that,” Ruttenberg says. “I think of him as more of a state’s rights guy and he clearly was not on board with that.”

Peterson, who had never appeared before the Supreme Court either, brought Steffen Johnson, an appellate specialist and litigation partner in the D.C. office of the multinational 150-year-old Winston and Strawn, to do the oral argument. Johnson, a long-time friend of Peterson, has been involved in about 60 cases before the Supreme Court, argued a couple, and been at the counsel table several times, he says.

Johnson felt they had a good case for winning. This was a busy term for the U.S. Supreme Court in the area of federal preemption where the court demonstrated a common sense view to find federal preemption where state law will interfere with the practicalities of how federal law operates.

After the oral arguments were concluded, Ruttenberg felt at peace with the job he did. “Everyone plays this game listening to the questions about how the justices are going to respond,” he says. “And based on the questioning people were asking, I thought I had a reasonable shot coming out of there.”

He lost. The decision was unanimous: 9-0. Maretta kept the money. (She declined to comment for this article).

Justice Sonia Sotomayor delivered the court’s opinion. This is an excerpt: “In short, where a beneficiary has been duly named, the insurance proceeds she is owed under FEGLI cannot be allocated to another person by operation of state law,” she wrote.

But while it still seems wrong to the average Joe that an ex-wife gets her former husband’s life insurance payout while his widow gets nothing, Peterson said that is not all that unusual. “I think in a lot of circumstances there is the actual intent to do that,” he says. “Someone may have children from a prior marriage, and the federal employee is mandated in a property settlement or divorce decree to keep the ex-spouse as a beneficiary because the life insurance money can then be used to care for the children. It may be used as a substitute for child support or alimony obligations.”

The way that the Virginia statute was written it had nothing to do with the dead spouse’s intent, Peterson says. “A spouse could have written to the ex-spouse saying ‘Hey, I know we got divorced, but you are still the beneficiary of my life insurance and I want you to have it.’ And if the guy died the next day it wouldn’t matter under this state statute. It would still be automatically revoked no matter what,” he says. “The statute was written in a kind of very blunt one-size-fits-all approach. And that is, principally, where the conflict with federal law came into play.”

But, even after the court decision, there were still questions. Surely a guy like Warren Hillman—who was so sharp he was able to start college at age 15, got a master’s degree in urban planning, oversaw a multimillion dollar federal student loan program, worked in the OMB where he advised presidents—a guy like that would make sure important financial details of his personal life were in order. Right?

But the sad truth is that Warren Hillman may have just forgotten to update his policy after his divorce. No one will ever know for sure.

The experience of working on this little four-year project is one of the reasons that 44-year-old Ruttenberg says he doesn’t litigate much. It’s the only case he’s ever lost. “I don’t think I have the right personality for it,” he says. “This never should have gone as far as it did, but I just wouldn’t let it go. And I’m too old to work 17 hours a day for 45 days straight. That is not necessarily a pleasant way to live.”

Hillman said that she has come to terms with the decision. “I have to let it go because I think I would be a very bitter person to just dwell on what happened,” she says. “I felt betrayed by Miss Maretta, but we just have different values. I’m OK. I am planning on retiring at the end of this semester. And I have been able to manage. I just don’t have the same kind of life I had before.”

 

(December 2013)

 

 

X