Christine Stuart photo

Attorney General George Jepsen on Monday notified Gov. Dannel P. Malloy and former Gov. John G. Rowland that he had withdrawn a petition asking the U.S. Supreme Court to review the unanimous decision of an appeals court in favor of Connecticut’s labor unions.

While state has the ability at any point to decide to refile the petition, Jepsen said he thought withdrawing it now and beginning negotiations with the State Employees Bargaining Agent Coalition will put the state in the best bargaining position to negotiate a settlement.

Earlier this year, an appeals court found that the state, under Rowland’s leadership, was wrong to lay off about 2,800 employees. The damages in the case and exposure to the state could climb into the tens of millions of dollars, but since negotiations haven’t started neither side wants to throw out a number.

Jepsen, a former labor attorney who ran on a ticket against Rowland in 2002, said he tries to “strip away the politics” and think about a case as if he was in private practice trying to get the best outcome for his client.

“This is the time of maximum leverage,” Jepsen said.

If the petition for review was denied three or four months from now, the state would be sitting across the negotiating table from an “emboldened adversary who’s holding most of the cards,” Jepsen said Monday at a press conference.

David Golub, the Stamford attorney who is representing the union coalition, sent a letter to Jepsen on Dec. 2 to tell him “that it is unlikely that the Supreme Court will decide to hear the case or reverse the Second Circuit.”

The U.S. Supreme Court received more than 7,000 petitions during the 2011-12 term and issued 64 signed opinions. Jepsen said the chances that the court would decide to review the case are slim considering the Second Circuit decision was unanimous and the circumstances of the underlying complaint were unique.

A three-judge panel found that it was wrong for Rowland and his budget chief, Marc Ryan, to lay off more than 2,800 state employees because they belonged to a union. Rowland and Ryan are being held personally liable for their decision.

“Defendants have not shown why the state’s fiscal health required firing only union members, rather than implementing membership-neutral layoffs,” Judge Gerard Lynch wrote for the panel in June.

In a statement, Rowland and Ryan, expressed disappointment in Jepsen’s decision to withdraw the petition and weren’t confident a settlement could be reached before the Supreme Court makes a decision to hear the case.

“We are mystified about why the state would now relent on this case at this critical juncture,” the statement reads.

Rowland and Ryan also have filed a petition with the court to review the appeals court decision. They maintain that if the Second Circuit decision stands, it “fundamentally hobbles public sector chief executives at all levels during the collective bargaining process. It will turn the collective bargaining process on its head and so favor unions in negotiations that public sector finances will be critically undermined in the future.”

Attorney Daniel Klau, who represents Rowland and Ryan, declined comment.

In his Dec. 2 letter, Golub maintained that the circumstances and facts were unique to the Rowland administration.

“The plaintiff unions did not challenge the constitutionality of the layoffs in either 2011 or 1991,” Golub wrote. “As you know, the case was decided by the Second Circuit on the basis of a highly-particularized stipulation of facts entered into for tactical reasons by the prior administration and prior counsel.”

Malloy applauded Jepsen’s decision to withdraw the request for review.

“By agreeing to withdraw the appeal for now and pursue negotiations while preserving the right to appeal to the Supreme Court at a later date, the Attorney General is putting Connecticut in a position to get the best possible resolution for Connecticut taxpayers,” Malloy said.

Jepsen said the state has made no request to Rowland to withdraw his petition for review of the decision. Rowland’s request for the U.S. Supreme Court to review the decision is based more on his individual liability, Jepsen said.

At a Monday press conference, Jepsen, who served as head of the Democratic Party for one year during Rowland’s tenure as governor, said the conversation informing Rowland of the state’s decision to withdraw was “very cordial.”

“John Rowland’s a very capable analyst,” Jepsen said, adding that what people have to understand is that if the state does not reach a negotiated settlement, there will be a hearing on damages and what’s decided at that hearing would be a final judgment. The state General Assembly would be asked to approve any settlement over $2.5 million.

During an half-hour press conference, Jepsen maintained that his decision the withdraw the complaint had nothing to do with politics or his relationship with organized labor or gubernatorial politics.

“Dan Malloy didn’t create this mess. It was one of the many messes that he inherited in this state,” Jepsen said.