Compliance May 18, 2007

Caterpillar Retiree Benefits Suit Gets Green Light

May 18, 2007 (PLANSPONSOR.com) - A federal judge in the U.S. District Court for the Middle District of Tennessee is allowing the progression of a class action suit by Caterpillar Inc. retirees or their surviving spouses who claim the heavy equipment maker denied them benefits they were promised.
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The plaintiffs argue that under a union collective bargaining agreement, the company was committed to provide free lifetime medical benefits for retirees and their surviving spouses; however, Caterpillar has been charging them for a portion of the insurance premium, according to Reuters.

U.S. District Judge Aleta Trauger said the plaintiffs’ case is strong enough to move forward in the legal process. “The plaintiffs have presented evidence that Caterpillar intended no-cost retiree medical benefits to last for life,” Trauger asserted in her ruling.

Caterpillar contends that the union had the power to amend benefits and that the court lacks the jurisdiction to hear the case, Reuters reported.

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