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Compliance August 9, 2011
PBGC Loses Fight against Harry & David Pension Dump
August 9, 2011 (PLANSPONSOR.com) – A bankruptcy court judge has granted gift basket retailer Harry & David Holdings permission to terminate its pension plan covering more than 2,700 workers.
Reported by Rebecca Moore
The decision comes in spite of the efforts of the Pension Benefit Guaranty Corporation, which opposes Harry & David’s move to end its pension plan and transfer it to PBGC (see PBGC Fighting Gift Basket Retailer’s Move to Dump Pensions).
According to a PBGC news release, Harry & David claimed it needed to terminate its pension plan because its investors, the private equity firm Wasserstein Partners LP, are unwilling to finance the pensions. PBGC told the court that the company could afford to keep the plan, and that the termination was being undertaken largely to increase investor returns, not out of necessity to emerge from bankruptcy.
PBGC said it would review the judge’s decision and decide whether or not to appeal.