Iafrate said the judge "did raise the issue" of negotiations during discussions with both sides. Tarantino declined to comment about any talks that might be under way.
Also on Friday, Taft-Carter agreed to let high-powered New York attorney David Boies join the state's legal team. Boies is famed for his work representing the government in its antitrust case against Microsoft and in Al Gore's unsuccessful presidential campaign challenge in the U.S. Supreme Court. He said defending the state's pension overhaul is important to the entire country.
"This is a critical case for Rhode Island but it's a critical case nationally," Boies said. "I think Rhode Island is a leader."
The state again sought to have Taft-Carter removed from the case because her uncle draws state retirement benefits. The state had earlier asked the judge to recuse herself because her mother also receives a state pension and because her son, a state police officer, is a member of the pension system as well. As a judge, Taft-Carter herself will be eligible for a pension when she retires.
Taft-Carter denied the state's motion for a recusal and insisted that her work in the case "will be and can be fair and impartial."
An earlier ruling by Taft-Carter on another pension case could foreshadow where the lawsuit is heading. Last year, Taft-Carter ruled that pension agreements are an implied contract and cannot be broken "on a whim." In her decision, she wrote that the state can modify its contracts with workers only if it can show such actions are necessary and reasonable.
Iafrate predicted the case could turn on the question of whether the law was necessary and reasonable.
"This is only the beginning," she said of Friday's action. "This is step one."