Plaintiffs to fight Solomon pension fund exemption


The three former patients who have accused Dr. Neil Solomon of taking sexual advantage of them while in his care believe they have found a loophole through which they might reach a portion of his $1.3 million retirement nest egg.

Attorneys for the former Maryland health secretary have conceded in U.S. Bankruptcy Court that the three women are entitled to payments from Dr. Solomon's assets. But the lawyers say federal bankruptcy rules allow him to keep his retirement money and any property held jointly with his wife -- accounting for nearly all his stated $2.2 million net worth.

From the remainder, Dr. Solomon has offered to pay $750 a month for five years toward successful claims against him. That would total $45,000 for all who sued.

The three former patients have sued for $140 million in damages.

After examining the retirement accounts, the patients' attorney, Charles B. Shafer, has filed objections to Dr. Solomon's attempt to exempt all the retirement money from his payment plan.

Mr. Shafer said the money originated in a private pension plan that Dr. Solomon "overfunded" -- that is, he deposited more than could legally be deducted from his income under Internal Revenue Service rules.

The excess amount would not be protected from creditors under the applicable bankruptcy rules, Mr. Shafer argued.

It's not clear how much money is at stake, Mr. Shafer said, because Dr. Solomon has not yet detailed deposits from 1977 through June 1986. But Mr. Shafer said excess deposits to the pension plan during the 18 months ending in December 1987 totaled "at least $100,000."

Dr. Solomon's attorney, Alan M. Grochal, said Dr. Solomon's own deposits were proper "and all money in the plan is exempt."

He conceded that the plan as a whole had been overfunded, but said the excess cash was distributed to the plan's participants as taxable income in 1988; the incorporated medical practice paid a penalty tax, and the corrected plan was reviewed and approved by the IRS in 1992.

These issues were expected to be aired at a hearing today before Judge E. Stephen Derby.

The court may also hear arguments on Dr. Solomon's proposed plan for settling the claims against him, and on the women's motion to convert the case to a Chapter 7 proceeding, which would make more of Dr. Solomon's wealth vulnerable to their claims.

The former patients filed suit last summer in Baltimore Circuit Court, accusing Dr. Solomon of luring them into sexual relationships while they were in his care. The husband of one patient joined in her suit. To protect their privacy, the court sealed all their names.

On Oct. 27, a state panel permanently revoked Dr. Solomon's medical license after he admitted having sex with at least eight patients over the past 20 years.

The former patients' lawsuits in Circuit Court were automatically suspended Sept. 20 when Dr. Solomon filed for bankruptcy protection. Under U.S. bankruptcy rules, such plaintiffs must seek compensation through the bankruptcy court like any other creditors.

In this case, they are the only creditors, and attorneys for the former patients have alleged in court that Dr. Solomon filed for bankruptcy protection as a legal strategy to limit any financial damage.

Most of Dr. Solomon's income came from his medical practice, which was located in Pikesville and later in Towson. He specialized in weight control, allergies, fitness and smoking cessation. He also published nine books and had a nationally syndicated newspaper column.

According to court papers, he saved aggressively for his retirement, depositing more than $1 million into the Neil Solomon Medical Professional Association Pension Plan between 1980 and 1986.

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