U.S. District Judge Arthur J. Tarnow of the U.S. District Court for the
Eastern District of Michigan set January 8 as the deadline for the agency to
file documents backing its July 31 termination of the plan which helped Delphi leave
Chapter 11 bankruptcy, according to the Warren Tribune Chronicle. A group of retirees filed a lawsuit in September claiming the pension insurer
violated federal law governing retirement plans because it acted in the best
interest of the company and industry rather than participants when requesting
the plan terminations (see PBGC Sued by Delphi Retirees).
The retirees also sought a preliminary injunction until
the case is resolved to stop the PBGC from reducing their pensions on February
1, but Tarnow didn’t grant an injunction, the newspaper said.
The retirees claim in their suit they stand to lose
between 30% and 70% of their pension benefits because the PBGC does not cover
supplementary benefits such as payments intended to bridge a retiree until
Social Security, and because the PBGC caps annual payments to retirees.
Earlier this month, the U.S. House Education and Labor Committee conducted a hearing on the impact of the Delphi bankruptcy on workers’ and retirees’ pensions and other benefits (see Congress Focuses on Delphi Bankruptcy’s Impact on Workers, Retirees).
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