R.I. Club Owners Ruled Not Personally Liable for Workers’ Comp Penalty

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A state hearing officer has ruled that the owners of a Rhode Island nightclub where a fire killed 100 people a year ago can’t be held personally liable for failing to carry workers’ compensation insurance.

Jeffrey and Michael Derderian, owners of The Station, were fined more than $1 million for not having the required insurance for four workers at the West Warwick club who were among those killed as a result of the Feb. 20, 2003, blaze. The same fine also was assessed against the Derderians’ company, Derco LLC.

Workers’ compensation insurance would have made an employee’s family eligible for $15,000 for burial and other expenses, plus a portion of lost wages.

It was not immediately clear if the decision by a hearing officer for the Department of Labor and Training could be appealed. The fine against Derco is under appeal in the Supreme Court.

Jeff Pine, attorney for Jeffrey Derderian, said the decision is “the position that we’ve been taking all along and we are pleased.” He and Kathleen Hagerty, an attorney for Michael Derderian, said the brothers intended to compensate the families, but would not elaborate.

The Derderians face involuntary manslaughter charges stemming from the fire, and are named in several lawsuits.

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