Representation Status
Koskie Minsky has been recognized by the court as the legal counsel for most ex-employees. The estimate is about 19,000 Canadian ex-employee claimants. K.M. will be representing 9,900 non-negotiated pension plan members, 1000 severed and people on Long Term Disability. They have received info from Nortel with the address list of all retirees, but are missing about 15,000 email addresses. Make sure your friends know to check the Canadian website to be registered and keep up to date. Active employees will have separate representation, as will CAW employees and those who choose to opt out.
Asset sales.
In Canada the process calls for written offers for the assets. There are 1 or 2 rounds of submission. It is a closed court process. The submissions are reviewed by the Monitor who recommends and seeks court approval.
In US the assets are sold by auction. Prospective buyers are identified and made public. A so called “stalking horse” bid is made by the first party. An auction is then scheduled and held with other bidders. The sale goes to the highest bidder.
The assets are sold from the country with the most involvement. Hence Wireless and Enterprise were sold through the US process.
Lock Box
All cash realized by the sales will be held in a lock box under joint jurisdiction of the courts. The monitor administers and manages the account. To release the funds a negotiation process is needed to reach an equitable allocation. If a compromise is not reached it could lead to protected litigation which would not a good thing since it will involve long legal wrangling and will cost a lot. The NRPC and KM are fully engaged to make sure Canada gets a fair realization. At this stage, there is no clear process or methodology for allocation of sale of assets among the estates. There still remains a large amount of intellectual property which has not been included in the sales and which also will require a methodology for disposition and allocation.
Monitor & Company
The monitor has become more involved in the management of the company. This way they can better look after the creditors. In the US there is the creditor’s committee- like the monitor, and in the UK there is an administrator. All decisions need court approval and therefore one area can’t be swamped by other jurisdictions. The Company is in a holding pattern. (1) Ongoing operations in selling units and transferring the people involved to purchasers (2) status quo on remaining units trying to keep some business flowing. There are only 3 remaining directors on the board which makes it easier to get decisions made. They are being paid a bit more but it is a lot cheaper than 9 directors
Funding on Canadian side.
The Canadian entity is a net spender of cash mainly because of R&D. It is reimbursed by non-Canadian entities which needs court approval in all areas. $157M been agreed to flow into Canada to keep it operating. Further negotiations are needed to continue. The monitor is working that.
Claims process
To ascertain the value of the claims everyone has to make a claim. Ex-employees (non negotiated) in Canada do not have to make their own individual claims since K.M. will handle that in a separate process. The CAW will work the claims for their members. All others must make their own claims.
Is is very difficult to say what the value of a pension claim might be. The fund is in a state of flux as the market shifts. Data from the company will help determine the formulae and assumptions that will be used. It will take a long while to work out. There may be a phased distribution where dollars are given out in a series of steps. There will be challenges to claims. People who don’t have real claims will try to get in on the process. K.M. will fight all claims that don’t appear real or justified.
Individuals in the pension plan will not be required to compile their own claim. There will be an omnibus claim filed in one big claim based on common methods of calculation with factors used to give the best possible numbers. There will be a communications with individuals to make sure that their claim is correct and agreed to.
Canadian Pension Plan Funding
In March it was estimated to be 69%. It could be higher due to market changes. All assets in the pension plan will have to be evaluated to determine the shortfall. The shortfall cannot be determined until all pension details are worked out. Nortel is still paying something into the fund.
Pension payments
The pension payments will continue as normal for now. There is no wind-up yet. The superintendent of pensions is a party in the court proceedings. Quebec and Ontario will press the case for an orderly process. Some money is still coming in to pay for unfunded liabilities and the intent is to keep that going as long as possible.
Severance
The court refused to pay severance. An appeal is underway. If granted approval to appeal, the hearing will be held in the Sept-Oct time frame. Provincial law has statutes protecting those with severance.
Health and Welfare Trust
Only administered by Sunlife. The trust has some assets which were partially pre-funded by Nortel in the past. K.M. should obtain standing on this by December. There is no law regarding pre-funding.
Tax impacts of payout
When settlement is made the process is normally lump sum payment which could require tax payments. If possible K.M. will work to have any settlements for pension used to top up the pension fund.
BIA amendment.
A petition has been circulating and will be presented to the Parliament. It may be too late however for Nortel pensioners. The NRPC political action committee is lobbying Investment Canada to use parts of the sale of assets for Nortel ex-employees.
Annuities
When the plan winds up pensions will be calculated on the funding ratio of the trust fund and converted to annuities. The Quebec Government has enacted a law (rule 1) which will allow pensioners with Quebec service to opt to have the government hold their pensions for up to 5 years in order to let the market improve. This would allow the pensioner to determine when to convert it to an annuity in order to maximize payments.
Hardship Cases
A hardship protocol has been approved by the court. People who are suffering financial hardship due to the loss of severance or other Nortel payment can apply. Check the K.M. and Ernst & Young websites. This will be an advance on any ultimate claim made.
Retainers
Koskie Minsky are now being paid by Nortel in an arms length mode as ordered by the court. There is no connection between K.M. and Nortel other than their representation on our behalf. K.M. will be returning the $150C ($120US) within the next month to everyone who sent them in. K.M. will be representing all ex-Nortel employees except negotiated (CAW), those who opt out, and some high level ex-executives.
Monday, August 31, 2009
IRS files $3B claim against Nortel
Just when I thought things couldn't get much worse, along comes the IRS to file a huge $3Billion claim against Nortel. If the judge allows this claim it would wipe out most of any assets left to divide among the rest of the creditors including those with non-qualified pension plan claims and severance claims. It's unclear why the IRS would have such a large claim since Nortel has been losing money over the last decade.
Could this have anything to do with Zafirovski's hurried departure from Nortel? I wonder.
The projected ratio of cash assets to claims with the sale of Nortel's business was estimated to be 50% or less worldwide before this bombshell so it looks like the return will be a lot less and will impact US claimants directly.
The details of the claim are uncertain but it is speculated that the claim stems from transactions between Nortel units in multiple countries and dates back to 1998 when Nortel was riding high on the internet wave. If this claim is upheld it will have a devastating impact on all other claimants.
Unfortunately there is no legal representation of ex-employees on the creditor's committee to fight the claim on our behalf (other than the PBGC), so once again we are at the mercy of the court in examining the validity of the claim to make sure that it truly represents what is owed.
The IRS has made large claims in many other bankruptcy proceedings and some of them have been reduced after negotiation and careful deliberation. Maybe the PBGC will step up to challenge the claim. Maybe not. In any event you can be sure we are once again being held over a barrel. First by Nortel, then the courts, and now by the IRS.
Could this have anything to do with Zafirovski's hurried departure from Nortel? I wonder.
The projected ratio of cash assets to claims with the sale of Nortel's business was estimated to be 50% or less worldwide before this bombshell so it looks like the return will be a lot less and will impact US claimants directly.
The details of the claim are uncertain but it is speculated that the claim stems from transactions between Nortel units in multiple countries and dates back to 1998 when Nortel was riding high on the internet wave. If this claim is upheld it will have a devastating impact on all other claimants.
Unfortunately there is no legal representation of ex-employees on the creditor's committee to fight the claim on our behalf (other than the PBGC), so once again we are at the mercy of the court in examining the validity of the claim to make sure that it truly represents what is owed.
The IRS has made large claims in many other bankruptcy proceedings and some of them have been reduced after negotiation and careful deliberation. Maybe the PBGC will step up to challenge the claim. Maybe not. In any event you can be sure we are once again being held over a barrel. First by Nortel, then the courts, and now by the IRS.
Saturday, August 29, 2009
Nortel bankruptcy and Loss of loyalty
During all those years we retirees worked for Nortel, the vast majority of us were extremely loyal and devoted to the company. In return the company paid us and looked after us with health care, life insurance, long term care, and financial planning options such as 401Ks, and RRSP. We also had a vast social network of friends and colleagues who in general helped one another to succeed.
Once we retired we found ourselves outside in Netherland, and our contact with the company became more and more distant and arm’s length. Retiree associations were limited to areas of large population and even then only some of us joined in those activities.
Now that Nortel is in Chapter 11 bankruptcy, the relationship has turned sour and we are almost seen as the enemy. The years of contribution and concern seem all for naught as the company flounders and treats us with disdain. So much brainpower that could have been put to good use to help the company during its rocky journey in the last decade has been ignored and dismissed. Such shortsightedness can only come from a poor understanding of the real strength of a company, and in the case of Nortel it appears to have started with the introduction of new external management who didn’t understand the market, the technology, or the culture within.
Now as Nortel lies on its death bed, the stupidity continues. All those thousands of retirees and ex-employees who at one time would stand up and be counted for Nortel, are faced with placing claims in the court systems of multiple countries, to try to regain some of the monies owed them for the years they spent building Nortel into the giant it became. How the mighty have fallen.
One would think that a reasoned approach would be that Nortel could tell each retiree or ex-employee what amount of money they each were owed. After all the data resides in the Nortel systems and they will have to generate the claims anyway to present them to the courts.
But that’s not the way it is. It’s never easy, and in this bankruptcy process, run by the courts, everyone has to try to work out their own claims. At least in Canada and I think the UK, the courts were intelligent enough to have an external agency accumulate the claims of the ex-employees so that they could be compared to the view from Nortel.
Not so in the USA however. Our bankruptcy judge would not recognize us on the creditor’s committee and as a result we will have thousands of people trying to figure out what Nortel owes them. There are bound to be huge discrepancies and technical glitches that will result in re-runs and reviews and legal debates that may go on for years. It’s certainly good business for the lawyers and the court since they will be getting paid during all this, and probably from Nortel’s dwindling assets.
So the upshot of this in all countries will be additional costs to determine the claims before the full extent of the liabilities can be determined. So that means charges to the Nortel assets as legal costs build and build, and that then means less money for the creditors including the retirees, when the loot is finally split up.
I must say that I am glad my claim in Canada is being handled by the actuaries and Koskie Minsky who is representing about 19,000 people. It makes my life a lot easier. But it could have been a much cheaper process if Nortel had simply sent the claim data by individual to us and to Koskie Minsky.
In the US we are lucky to have Segal working out claims for a few people who have contributed payments to the US NRPC. But there are thousands of others who are not in this group who will undoubtedly have a lot of difficulty calculating their claims and getting agreement with Nortel.
In addition we have not been admitted to the creditor’s committee. The only people represented on that committee are those with qualified defined pensions and they are being represented by the PBGC which has little or no knowledge of the Nortel ex-employee population other than what has been sent to them by Nortel’s agent Mercer.
At the web seminar held by Koskie Minsky and the Canadian NRPC this week, the lawyer from K.M. described how in Canada they were dealing with the court and with the monitor, Ernst & Young. There has been progress in that process, and there is definitely a feeling that ex-employee interests are being well looked after by a caring law firm that understands how to protect our rights.
The monitor, E&Y, is now managing Nortel and basically running the business. And although we have no direct contact with them, K.M., on behalf of the Canadian contingent, can review and if necessary question the decisions being made.
In contrast in the US there is no such monitor and as the representative from K.M. stated, the creditor’s committee has some of that responsibility here. In the US we have no contact with that committee other than through the court appointed attorneys Akin Gump representing all unsecured creditors, and the PBGC. So we have basically been cut adrift and are at the mercy of the court.
Once we retired we found ourselves outside in Netherland, and our contact with the company became more and more distant and arm’s length. Retiree associations were limited to areas of large population and even then only some of us joined in those activities.
Now that Nortel is in Chapter 11 bankruptcy, the relationship has turned sour and we are almost seen as the enemy. The years of contribution and concern seem all for naught as the company flounders and treats us with disdain. So much brainpower that could have been put to good use to help the company during its rocky journey in the last decade has been ignored and dismissed. Such shortsightedness can only come from a poor understanding of the real strength of a company, and in the case of Nortel it appears to have started with the introduction of new external management who didn’t understand the market, the technology, or the culture within.
Now as Nortel lies on its death bed, the stupidity continues. All those thousands of retirees and ex-employees who at one time would stand up and be counted for Nortel, are faced with placing claims in the court systems of multiple countries, to try to regain some of the monies owed them for the years they spent building Nortel into the giant it became. How the mighty have fallen.
One would think that a reasoned approach would be that Nortel could tell each retiree or ex-employee what amount of money they each were owed. After all the data resides in the Nortel systems and they will have to generate the claims anyway to present them to the courts.
But that’s not the way it is. It’s never easy, and in this bankruptcy process, run by the courts, everyone has to try to work out their own claims. At least in Canada and I think the UK, the courts were intelligent enough to have an external agency accumulate the claims of the ex-employees so that they could be compared to the view from Nortel.
Not so in the USA however. Our bankruptcy judge would not recognize us on the creditor’s committee and as a result we will have thousands of people trying to figure out what Nortel owes them. There are bound to be huge discrepancies and technical glitches that will result in re-runs and reviews and legal debates that may go on for years. It’s certainly good business for the lawyers and the court since they will be getting paid during all this, and probably from Nortel’s dwindling assets.
So the upshot of this in all countries will be additional costs to determine the claims before the full extent of the liabilities can be determined. So that means charges to the Nortel assets as legal costs build and build, and that then means less money for the creditors including the retirees, when the loot is finally split up.
I must say that I am glad my claim in Canada is being handled by the actuaries and Koskie Minsky who is representing about 19,000 people. It makes my life a lot easier. But it could have been a much cheaper process if Nortel had simply sent the claim data by individual to us and to Koskie Minsky.
In the US we are lucky to have Segal working out claims for a few people who have contributed payments to the US NRPC. But there are thousands of others who are not in this group who will undoubtedly have a lot of difficulty calculating their claims and getting agreement with Nortel.
In addition we have not been admitted to the creditor’s committee. The only people represented on that committee are those with qualified defined pensions and they are being represented by the PBGC which has little or no knowledge of the Nortel ex-employee population other than what has been sent to them by Nortel’s agent Mercer.
At the web seminar held by Koskie Minsky and the Canadian NRPC this week, the lawyer from K.M. described how in Canada they were dealing with the court and with the monitor, Ernst & Young. There has been progress in that process, and there is definitely a feeling that ex-employee interests are being well looked after by a caring law firm that understands how to protect our rights.
The monitor, E&Y, is now managing Nortel and basically running the business. And although we have no direct contact with them, K.M., on behalf of the Canadian contingent, can review and if necessary question the decisions being made.
In contrast in the US there is no such monitor and as the representative from K.M. stated, the creditor’s committee has some of that responsibility here. In the US we have no contact with that committee other than through the court appointed attorneys Akin Gump representing all unsecured creditors, and the PBGC. So we have basically been cut adrift and are at the mercy of the court.
Friday, August 28, 2009
Canada Web Seminar now available on NRPC site
The web seminar audio and slides from the NRPC and Koskie Minsky, held on August 25, are now available on the Canadian Nortel pensioner’s web site. You need to be registered on the web site in order to listen to the seminar. Registering will also provide you with the communications from the NRPC and help ensure that your claim will be included in the total claim being made for Ex-Nortel employees in Canada.
The seminar covered a wide range of topics and provided many answers to questions that people have about the process. It discussed in detail the claims process for ex-employees which is being handled on your behalf by the NRPC and Koskie Minsky. This is distinctly different form the US where all claimants will be submitting their claims individually.
The seminar may be of interest to ex- Nortel employees who are not based in Canada. It discussed the sale of assets process, the management of the funds generated from those sales, the method of allocation of the assets by geographic location, and the possible time frame. Much of the information is useful for all ex-Nortel employees regardless of location.
There were over 300 questions submitted on line and via email and the NRPC will be attempting to answer them and publish them on their web site in the next few days.
Once I have absorbed the information, I will try to summarize the points made and post them on this site. In general my view from the seminar is that this will be a long drawn out process and that the determination of claims, the allocation of assets, and the eventual payment of claims may take years. In the mean time K.M. and the NRPC will work to keep the Canadian pension plan in operation as long as possible in order to let it build up as the market improves.
The payment of US claims will also be part of this long drawn out process. Until the total value of all assets is established and the allocation process is agreed upon, no monies will be released to satisfy claims in any jurisdiction.
The seminar covered a wide range of topics and provided many answers to questions that people have about the process. It discussed in detail the claims process for ex-employees which is being handled on your behalf by the NRPC and Koskie Minsky. This is distinctly different form the US where all claimants will be submitting their claims individually.
The seminar may be of interest to ex- Nortel employees who are not based in Canada. It discussed the sale of assets process, the management of the funds generated from those sales, the method of allocation of the assets by geographic location, and the possible time frame. Much of the information is useful for all ex-Nortel employees regardless of location.
There were over 300 questions submitted on line and via email and the NRPC will be attempting to answer them and publish them on their web site in the next few days.
Once I have absorbed the information, I will try to summarize the points made and post them on this site. In general my view from the seminar is that this will be a long drawn out process and that the determination of claims, the allocation of assets, and the eventual payment of claims may take years. In the mean time K.M. and the NRPC will work to keep the Canadian pension plan in operation as long as possible in order to let it build up as the market improves.
The payment of US claims will also be part of this long drawn out process. Until the total value of all assets is established and the allocation process is agreed upon, no monies will be released to satisfy claims in any jurisdiction.
Thursday, August 27, 2009
Canada Web Seminar
The Canadian NRPC held a web seminar on August 25th for Canadian ex-Nortel employees and retirees.
The slides used in the Web Seminar may be found at the following page on the Koskie Minsky Site:
http://www.koskieminsky.com/upload/090133_NRPC_WEBCAST_ENGLISH_25Aug09.pdf
The NRPC usually posts a link to the recording of the seminar. I will publish the link once they have established it.
The slides used in the Web Seminar may be found at the following page on the Koskie Minsky Site:
http://www.koskieminsky.com/upload/090133_NRPC_WEBCAST_ENGLISH_25Aug09.pdf
The NRPC usually posts a link to the recording of the seminar. I will publish the link once they have established it.
Saturday, August 22, 2009
Nortel US Claims process NRPC Members
Agreement has been reached with Nortel to provide electronic information to Segal for the paying members of the NRPC-US. A release form has been agreed to by Nortel's attorney and each member has been requested to sign the form and fax it to Segal and mail it to Nortel's representative.
The deadline for this process is August 28th. All members of the NRPC-US who wish to have their claims against Nortel calculated by Segal need to complete and return the release form so that their information can be transmitted from Nortel to Segal.
The benefit of doing this is that the calculation carried out by Segal should match the calculation carried out by Nortel's actuarial firm. This should reduce the issues that will arise in court if claims by former creditors do not agree with the calculations that Nortel has made in determining the value of the claim from their records.
Former Nortel employees who are creditors and are not members of the NRPC-US should consider joining the group if they wish to avoid possible discrepancies in court. Check the website www.nnra.org, shown in the right hand column on this page as US Pensioners NRPC. The details for joining are displayed on that web site.
You will need to do that as soon as possible in order to take advantage of the Segal calculation.
The deadline for this process is August 28th. All members of the NRPC-US who wish to have their claims against Nortel calculated by Segal need to complete and return the release form so that their information can be transmitted from Nortel to Segal.
The benefit of doing this is that the calculation carried out by Segal should match the calculation carried out by Nortel's actuarial firm. This should reduce the issues that will arise in court if claims by former creditors do not agree with the calculations that Nortel has made in determining the value of the claim from their records.
Former Nortel employees who are creditors and are not members of the NRPC-US should consider joining the group if they wish to avoid possible discrepancies in court. Check the website www.nnra.org, shown in the right hand column on this page as US Pensioners NRPC. The details for joining are displayed on that web site.
You will need to do that as soon as possible in order to take advantage of the Segal calculation.
Friday, August 21, 2009
Nortel tax credits could help the pension trust fund deficit
Nortel still has about $2Billion in unutilized Canadian Scientific Research and Experimental Development tax credits and prior period tax loss carry forwards.
The Canadian federal government should be working with the acquirers of Nortel businesses to include these tax credits in such a way that the money released could be used in the pension trust funds and other accounts to help disabled and severed employees.
It seems like a great way to solve most of the trust fund's issue without having a government bail out as such. If nothing is done the money will fade into the government coffers to be lost to the Nortel pensioners and employees forever.
The NRPC and the lawyers Koskie Minsky are aware of this. We need to have this addressed quickly and aggressively to have those credits applied to the deficits in our pension trusts and other trusts.
If you are affected by the Canadian trust fund deficit, or have lost your severance or stand to lose disability payments, you need to have your voice heard.
Write to the prime minister Stephen Harper, and the honourable Tony Clement, Minister of Health and Minister for the Federal Economic Development, as well as the honourable James Michael Flaherty, Minister of Finance, to urge their immdeiate action to use those tax credits to help Canadian retirees and disabled and severed Nortel employees.
The Canadian federal government should be working with the acquirers of Nortel businesses to include these tax credits in such a way that the money released could be used in the pension trust funds and other accounts to help disabled and severed employees.
It seems like a great way to solve most of the trust fund's issue without having a government bail out as such. If nothing is done the money will fade into the government coffers to be lost to the Nortel pensioners and employees forever.
The NRPC and the lawyers Koskie Minsky are aware of this. We need to have this addressed quickly and aggressively to have those credits applied to the deficits in our pension trusts and other trusts.
If you are affected by the Canadian trust fund deficit, or have lost your severance or stand to lose disability payments, you need to have your voice heard.
Write to the prime minister Stephen Harper, and the honourable Tony Clement, Minister of Health and Minister for the Federal Economic Development, as well as the honourable James Michael Flaherty, Minister of Finance, to urge their immdeiate action to use those tax credits to help Canadian retirees and disabled and severed Nortel employees.
Thursday, August 20, 2009
US- NRPC Release Form claim process through Segal company.
The US-NRPC sent out an email to all its paying members yesterday requesting that they complete a release form so that Segal Co. can obtain electronic information from Nortel in order to assist in calculating individual personal claims against Nortel; The following is an exerpt from the communication.
US NRPC Participants Status Update
August 19, 2009
On August 4 2009 the Delaware Court issued Docket 1280 establishing September 30 2009as a deadline (bar date) for filing Proofs of Claim in the Nortel Networks bankruptcy proceedings.
Following this, the court ordered that bar coded proof of claim forms be sent to the unsecured creditors of record. By now, most of you will have received several of these proof of claim forms, some of which are bar coded and some not, some of which may have dollar amounts and some not.
For those who have NOT joined the NRPC (did not send in checks or requested a refund of their contributions after Martin & Millers fees had been deducted) it will be necessary to complete the forms and return them to the address indicated on the form so that they are received by the bar date.
For those who HAVE joined the NRPC, please read the section of this email entitled “US NRPC Claims Process” below.
Claims should be filed only for benefits which have been cancelled/suspended (such as non-qualified pensions and severance). You should not file a claim for a benefit if that benefit was paid in full as of the bankruptcy filing and has continued to be paid in full since the bankruptcy filing.
For the former employees who are still receiving these benefits: if/when Nortel cancels or modifies these benefits the court will set a subsequent bar date to file claims for such benefits.
US NRPC Process
As you will recall, Segal Co. http://www.segalco.com has been retained both in Canada and in the U.S. to calculate the claims of former employees. In Canada retirees have a seat on the Creditor’s Committee. Their participation on the Committee means Nortel will pay Segal Co. fees for the calculation and submission of all retiree claims.
The claims process in the U.S. differs from that process in Canada in 2 significant ways:
1. In the US Nortel is not required to pay our actuarial fees - we are required to pay Segal Co.’s fees ourselves. For those who have joined the NRPC and sent in their checks some of these funds will be used pay Segal Co.’s fees. Segal Co. will not calculate claims for those employees who have not sent in checks.
2. In the US Segal will obtain our claims information from Mercer, calculate our individual claims and send the resulting claims calculation to each USNRPC member for review. It will then be the responsibility of the individual USNRPC member to transfer the information to the bar coded forms they have received and send those forms to Epiq at the address provided on the claim form. This is a change from our original intent – which was that Segal Co. would file our claims directly. This change was made in light of the longer than expected period it has taken to facilitate the exchange of claims information with Nortel. We must eliminate some previously planned steps and make greater use of email rather than the postal service in order to take maximum advantage of the time available before the bar date.
In May, Nortel’s attorneys (Cleary, Gotlieb) had reached agreement in principle with the attorneys for the unsecured creditors (Akin Gump) that Nortel’s actuaries (Mercer) would provide Segal Co. (our actuaries) with the actuarial information required to calculate former employee claims.
In early July, Segal Co. approached Mercer to begin the data transfer process and were informed that Nortel had a concern about providing such information which is protected by privacy laws without the written consent of the former employees. For more than a month the USNRPC, Segal Co, Akin Gump and Cleary Gotlieb have been working to create an information release form which Nortel would find acceptable. On Friday August 14, agreement was reached. Unfortunately, as of today Cleary Gotlieb is not able to give us the name of the attorney or Nortel employee to whom we should send these release forms. Akin Gump is following up daily. In the meantime we can, however, make some progress.
Information Release Forms:
Please complete, sign and return the attached Information Release Form. You may return it in one of two ways:
Either:
-Scan it, and reply to this USNRPC email with the scanned and completed form as an attachment.
Or
-Print out the attached release form, complete and sign it and fax it to Segal Co.
And
-Make a copy of the completed Infromation Release Form for your records
And
Save the signed original. When we receive the name of the Cleary Gotlieb attorney or Nortel employee to whom we should send the original signed release form we will send you another email update which will contain such contact information and a description of how the Segal Co. claims process will work.
The cutoff for return of the Information Release Forms is August 28, 2009. Please send in your Information Release Form as promptly as possible.
For former employees who have not yet joined the US NRPC but wish to have Segal Co. assistance in the calculation of claims it is not too late. We will be accepting new memberships until September 7, 2009. Please complete the membership form which can be downloaded at http://nnra.org and send it with a check for $250 to the address dshown on the web site
Former members who contributed $250 to Miller and Martin, requested and received their $175 refund, but now wish to rejoin can do so by sending a check for $175 before September 7, 2009.
As always, any monies remaining at the completion of the court case will be returned to members on a pro rata basis.
The NUSRPC is not offering legal advice but only information on the claims process that it believes is accurate as of the date provided. Nothing in this email is intended to be, nor should it be construed to be, legal advice.
NUSRPC (Nortel US Retirement Protection Committee)
US NRPC Participants Status Update
August 19, 2009
On August 4 2009 the Delaware Court issued Docket 1280 establishing September 30 2009as a deadline (bar date) for filing Proofs of Claim in the Nortel Networks bankruptcy proceedings.
Following this, the court ordered that bar coded proof of claim forms be sent to the unsecured creditors of record. By now, most of you will have received several of these proof of claim forms, some of which are bar coded and some not, some of which may have dollar amounts and some not.
For those who have NOT joined the NRPC (did not send in checks or requested a refund of their contributions after Martin & Millers fees had been deducted) it will be necessary to complete the forms and return them to the address indicated on the form so that they are received by the bar date.
For those who HAVE joined the NRPC, please read the section of this email entitled “US NRPC Claims Process” below.
Claims should be filed only for benefits which have been cancelled/suspended (such as non-qualified pensions and severance). You should not file a claim for a benefit if that benefit was paid in full as of the bankruptcy filing and has continued to be paid in full since the bankruptcy filing.
For the former employees who are still receiving these benefits: if/when Nortel cancels or modifies these benefits the court will set a subsequent bar date to file claims for such benefits.
US NRPC Process
As you will recall, Segal Co. http://www.segalco.com has been retained both in Canada and in the U.S. to calculate the claims of former employees. In Canada retirees have a seat on the Creditor’s Committee. Their participation on the Committee means Nortel will pay Segal Co. fees for the calculation and submission of all retiree claims.
The claims process in the U.S. differs from that process in Canada in 2 significant ways:
1. In the US Nortel is not required to pay our actuarial fees - we are required to pay Segal Co.’s fees ourselves. For those who have joined the NRPC and sent in their checks some of these funds will be used pay Segal Co.’s fees. Segal Co. will not calculate claims for those employees who have not sent in checks.
2. In the US Segal will obtain our claims information from Mercer, calculate our individual claims and send the resulting claims calculation to each USNRPC member for review. It will then be the responsibility of the individual USNRPC member to transfer the information to the bar coded forms they have received and send those forms to Epiq at the address provided on the claim form. This is a change from our original intent – which was that Segal Co. would file our claims directly. This change was made in light of the longer than expected period it has taken to facilitate the exchange of claims information with Nortel. We must eliminate some previously planned steps and make greater use of email rather than the postal service in order to take maximum advantage of the time available before the bar date.
In May, Nortel’s attorneys (Cleary, Gotlieb) had reached agreement in principle with the attorneys for the unsecured creditors (Akin Gump) that Nortel’s actuaries (Mercer) would provide Segal Co. (our actuaries) with the actuarial information required to calculate former employee claims.
In early July, Segal Co. approached Mercer to begin the data transfer process and were informed that Nortel had a concern about providing such information which is protected by privacy laws without the written consent of the former employees. For more than a month the USNRPC, Segal Co, Akin Gump and Cleary Gotlieb have been working to create an information release form which Nortel would find acceptable. On Friday August 14, agreement was reached. Unfortunately, as of today Cleary Gotlieb is not able to give us the name of the attorney or Nortel employee to whom we should send these release forms. Akin Gump is following up daily. In the meantime we can, however, make some progress.
The following information in the email applies to the release form which was sent to paying USNRPC members but is not shown here. If you wish to participate in this you need to join the NRPC by following the instructions on www.nnra.org. You will need to do this very quickly if you want to be included in the Segal calculations.
Information Release Forms:
Please complete, sign and return the attached Information Release Form. You may return it in one of two ways:
Either:
-Scan it, and reply to this USNRPC email with the scanned and completed form as an attachment.
Or
-Print out the attached release form, complete and sign it and fax it to Segal Co.
And
-Make a copy of the completed Infromation Release Form for your records
And
Save the signed original. When we receive the name of the Cleary Gotlieb attorney or Nortel employee to whom we should send the original signed release form we will send you another email update which will contain such contact information and a description of how the Segal Co. claims process will work.
The cutoff for return of the Information Release Forms is August 28, 2009. Please send in your Information Release Form as promptly as possible.
For former employees who have not yet joined the US NRPC but wish to have Segal Co. assistance in the calculation of claims it is not too late. We will be accepting new memberships until September 7, 2009. Please complete the membership form which can be downloaded at http://nnra.org and send it with a check for $250 to the address dshown on the web site
Former members who contributed $250 to Miller and Martin, requested and received their $175 refund, but now wish to rejoin can do so by sending a check for $175 before September 7, 2009.
As always, any monies remaining at the completion of the court case will be returned to members on a pro rata basis.
The NUSRPC is not offering legal advice but only information on the claims process that it believes is accurate as of the date provided. Nothing in this email is intended to be, nor should it be construed to be, legal advice.
NUSRPC (Nortel US Retirement Protection Committee)
Wednesday, August 19, 2009
Claims against Nortel Process - update
Today I had a helpful discussion with an attorney from Cleary Gottlieb Steen & Hamilton LLP, the law firm representing Nortel. I asked about the claims process and more specifically about what happens if there is a discrepancy. He told me that there will be omnibus hearings at which groups of creditors whose claims differ from Nortel’s will be reviewed by the court. Following these hearings a notification will be sent to the person making the claim showing the Nortel projection of the claim as compared to that submitted.
If the person submitting the claim agrees with Nortel’s estimate, I think the claim will then be fully accepted. If not, it is unclear what the next steps will be, but I think it will require some legal representation to present the basis for the claim before the court.
The NRPC-US steering committee has been negotiating with Nortel’s law firm and Segal to obtain agreement to transmit information from Nortel to Segal so that they can determine the claim amount for each individual. This process would only apply to the paying membership of the NRPC and if successful would mean that the factors used in the calculation would be agreed to before hand by Nortel’s actuaries and Segal’s actuaries. Hence the claim should be the same as what Nortel would estimate. Each individual member of the NRPC-US would have to personally file their own claims, but they will have the information from Segal to use in presenting proof of claim.
The NRPC-US have not yet finalized the details of how this would work but are working to complete the agreement and should have some information sent to their membership in the next few days. Please check www.nnra.org for developments.
For those of you who are not paying members of the NRPC-US and who wish to participate in this process, please check the same website for information on how to join. Because of the shortness of the time frame before the bar date, Sept 30th, the NRPC-US will probably set a deadline beyond which they can’t accept any more members, so that they can have Segal complete the work. Please tell your colleagues to check www.nnra.org or this blog to keep abreast of developments.
This is probably the best way to have a claim made on Nortel that will not be rejected in court. Let’s hope that all the details can be worked out between Nortel and Segal quickly so that we can make this process work for us.
If the person submitting the claim agrees with Nortel’s estimate, I think the claim will then be fully accepted. If not, it is unclear what the next steps will be, but I think it will require some legal representation to present the basis for the claim before the court.
The NRPC-US steering committee has been negotiating with Nortel’s law firm and Segal to obtain agreement to transmit information from Nortel to Segal so that they can determine the claim amount for each individual. This process would only apply to the paying membership of the NRPC and if successful would mean that the factors used in the calculation would be agreed to before hand by Nortel’s actuaries and Segal’s actuaries. Hence the claim should be the same as what Nortel would estimate. Each individual member of the NRPC-US would have to personally file their own claims, but they will have the information from Segal to use in presenting proof of claim.
The NRPC-US have not yet finalized the details of how this would work but are working to complete the agreement and should have some information sent to their membership in the next few days. Please check www.nnra.org for developments.
For those of you who are not paying members of the NRPC-US and who wish to participate in this process, please check the same website for information on how to join. Because of the shortness of the time frame before the bar date, Sept 30th, the NRPC-US will probably set a deadline beyond which they can’t accept any more members, so that they can have Segal complete the work. Please tell your colleagues to check www.nnra.org or this blog to keep abreast of developments.
This is probably the best way to have a claim made on Nortel that will not be rejected in court. Let’s hope that all the details can be worked out between Nortel and Segal quickly so that we can make this process work for us.
Monday, August 17, 2009
Claims against Nortel Process
In an earlier post I stated that I had received 3 different bar-coded claim forms from Epiq last Friday. In discussions with an Epiq representative this morning (Aug 17th 2009) he told me that two of the three schedule numbers were actually just data base references and that I should file the claim with the schedule number that is listed on their docket 801. He didn’t know why I had received the additional forms but basically told me to forget about them and focus on the one that is recorded.
I took the opportunity to ask him about filing claims for health care and other benefits. He could not give me any specific direction on this, but said that if I thought that I had a claim against Nortel I should file it.
I then asked if there was a process to be followed if Nortel disputed a claim. He told me that Nortel would review all the claims and would then contact the claimant if they disagreed. I asked if any claims were ever rejected outright and he said there have been cases like that but generally the debtor (IE Nortel) would review the claim and contact the claimant if there was disagreement. Given Nortel’s lack of communications with us so far I’m not sure how that will happen.
Following my discussion with Epiq I spoke with a lawyer at Akin Gump, the court appointed legal firm representing all unsecured creditors. He said that he couldn’t give any legal advice but was willing to speak with me in an unofficial capacity and address non specific questions. I asked him about filing for health care, long term care, and insurance now, even though Nortel had not yet ceased those programs. He was not able to state directly what I should do but said that if I felt I had a claim against Nortel I should file it. I asked if Nortel would reject such claims at this point and he said that it would be up to Nortel but at least the claim would be on file.
I then asked it there had ever been a case where a new bar date had been set for different claims and he told me that he had seen that happen before. So it is possible that a different bar date would be established for claims relating to benefits other than pension, or specific compensation such as severance etc.
This chapter 11 process is intentionally vague, loose, and relaxed. Given all this lack of direct advice it seems that there is no clear process in order to keep the creditors in the dark and give the debtor an advantage. Bankruptcy is meant to help the bankrupt company not the creditor so don’t be surprised when Nortel and their lawyers present all sorts of arguments against your claim to try to avoid paying it.
I took the opportunity to ask him about filing claims for health care and other benefits. He could not give me any specific direction on this, but said that if I thought that I had a claim against Nortel I should file it.
I then asked if there was a process to be followed if Nortel disputed a claim. He told me that Nortel would review all the claims and would then contact the claimant if they disagreed. I asked if any claims were ever rejected outright and he said there have been cases like that but generally the debtor (IE Nortel) would review the claim and contact the claimant if there was disagreement. Given Nortel’s lack of communications with us so far I’m not sure how that will happen.
Following my discussion with Epiq I spoke with a lawyer at Akin Gump, the court appointed legal firm representing all unsecured creditors. He said that he couldn’t give any legal advice but was willing to speak with me in an unofficial capacity and address non specific questions. I asked him about filing for health care, long term care, and insurance now, even though Nortel had not yet ceased those programs. He was not able to state directly what I should do but said that if I felt I had a claim against Nortel I should file it. I asked if Nortel would reject such claims at this point and he said that it would be up to Nortel but at least the claim would be on file.
I then asked it there had ever been a case where a new bar date had been set for different claims and he told me that he had seen that happen before. So it is possible that a different bar date would be established for claims relating to benefits other than pension, or specific compensation such as severance etc.
This chapter 11 process is intentionally vague, loose, and relaxed. Given all this lack of direct advice it seems that there is no clear process in order to keep the creditors in the dark and give the debtor an advantage. Bankruptcy is meant to help the bankrupt company not the creditor so don’t be surprised when Nortel and their lawyers present all sorts of arguments against your claim to try to avoid paying it.
Sunday, August 16, 2009
Epiq sends out claim forms
Epiq has started sending out claim forms and guidelines to Nortel creditors. On Friday 14th August 2009, I received 3 sets of forms from Epiq. Each one was identified with a schedule number. I checked on the docket 801 on the Epiq website and could only find one of the numbers listed with my name and address so I assume that is the claim I should complete. I will be checking with Epiq on Monday to find out why they sent three different claim forms.
Each package had a form listed Section 503(b)(9) Claim Request Form, a bar coded Proof of Claim form, and a guideline pamphlet.
If you believe you have a claim and you have not received a package you should check docket number 801 on the Epiq website (see links on right hand column of this page), and call Epiq to make sure your claim is listed on the docket and that you receive the bar coded proof of claim form.
At this point I am unsure as to whether claims may be made for health care, life insurance, and long term care. Calculation of claims such as these is very complicated. Non-qualified pension claims that were being paid as annuities are also quite complicated. You will need to deal with actuarial tables and interest rates to determine the amount and it may be necessary to obtain professional help to determine the amount.
Another point that is still unclear is the process in the case of dispute by Nortel on the amount for your specific claim.
As things become clearer I will publish what I find out on this web site.
Each package had a form listed Section 503(b)(9) Claim Request Form, a bar coded Proof of Claim form, and a guideline pamphlet.
If you believe you have a claim and you have not received a package you should check docket number 801 on the Epiq website (see links on right hand column of this page), and call Epiq to make sure your claim is listed on the docket and that you receive the bar coded proof of claim form.
At this point I am unsure as to whether claims may be made for health care, life insurance, and long term care. Calculation of claims such as these is very complicated. Non-qualified pension claims that were being paid as annuities are also quite complicated. You will need to deal with actuarial tables and interest rates to determine the amount and it may be necessary to obtain professional help to determine the amount.
Another point that is still unclear is the process in the case of dispute by Nortel on the amount for your specific claim.
As things become clearer I will publish what I find out on this web site.
Friday, August 14, 2009
Instructions to Board of Directors on how to ruin a great company in 5 easy steps.
1. Take a great company and put in place a CEO who is greedy and arrogant. Allow him to go on a wild buying spree without a clear strategy, thereby using up the accumulated cash on useless and worthless purchases.
2. Let CEO get rid of all the strategic assets by outsourcing them indiscriminately to foreign corporations in a tricky strategy disguised as a means of reducing costs, and then let him leave with a tremendous bonus.
3. Replace CEO with a series of incompetents who have no knowledge of the core industry. Let them steal the company blind and run it into the ground with frivolous marketing and technology decisions.
4. Declare bankruptcy protection to allow the surreptitious division of the company into chunks that can be sold off piecemeal to previous competitors at bargain basement prices.
5. And as a final icing on the cake, ensure all employees and retirees are victimized by eliminating promised benefits, and under funding all trust funds so that they will lose most of their earned benefits.
I’m sure American and Canadian business schools will be using the example of Nortel’s mismanagement for decades and possibly centuries to come. It’s too bad that the board of directors of Nortel were so inept and unable to control the people who took over the reins of the company, once it had become a major world player. Nortel’s loss is not just Canada’s loss; it is also North America’s loss. With Lucent owned by Alcatel, and Nortel gone, there are no major N.A. players who can truly call themselves telecommunications giants. How shortsighted is that?
2. Let CEO get rid of all the strategic assets by outsourcing them indiscriminately to foreign corporations in a tricky strategy disguised as a means of reducing costs, and then let him leave with a tremendous bonus.
3. Replace CEO with a series of incompetents who have no knowledge of the core industry. Let them steal the company blind and run it into the ground with frivolous marketing and technology decisions.
4. Declare bankruptcy protection to allow the surreptitious division of the company into chunks that can be sold off piecemeal to previous competitors at bargain basement prices.
5. And as a final icing on the cake, ensure all employees and retirees are victimized by eliminating promised benefits, and under funding all trust funds so that they will lose most of their earned benefits.
I’m sure American and Canadian business schools will be using the example of Nortel’s mismanagement for decades and possibly centuries to come. It’s too bad that the board of directors of Nortel were so inept and unable to control the people who took over the reins of the company, once it had become a major world player. Nortel’s loss is not just Canada’s loss; it is also North America’s loss. With Lucent owned by Alcatel, and Nortel gone, there are no major N.A. players who can truly call themselves telecommunications giants. How shortsighted is that?
Wednesday, August 12, 2009
Epiq confirms that claims forms will be mailed to creditors
In an earlier post I mentioned that Epiq Systems had told me they would mail claim forms to Nortel creditors once a bar date had been set by the court. I spoke to a representative of Epiq Systems today and he confirmed that Epiq will be mailing claim forms that have been bar coded along with some guidelines to all creditors listed on the creditor's list.
All creditors should check that list to make sure their names and addresses are on there and are correct. If your name is not on that list call Epiq at 866 897 6435 to have it corrected.
You can find the creditors list on the epiq web site shown in the right hand column on this page. The list is docket number 801. Use the search tool to find your name on the list since it is 850 pages long.
The Epiq representative told me the mailing would be happening soon. We have until Sept 30th to have the claims submitted and registered. Look for the mailing in the next 2 weeks. If you haven't received the form in that time I would encourage you to call Epiq again. Don't wait too late to send in your form and allow for delivery issues so that, if necessary, you can resend it in time.
All creditors should check that list to make sure their names and addresses are on there and are correct. If your name is not on that list call Epiq at 866 897 6435 to have it corrected.
You can find the creditors list on the epiq web site shown in the right hand column on this page. The list is docket number 801. Use the search tool to find your name on the list since it is 850 pages long.
The Epiq representative told me the mailing would be happening soon. We have until Sept 30th to have the claims submitted and registered. Look for the mailing in the next 2 weeks. If you haven't received the form in that time I would encourage you to call Epiq again. Don't wait too late to send in your form and allow for delivery issues so that, if necessary, you can resend it in time.
Monday, August 10, 2009
Canadian Claims process against Nortel
The Canadian courts have agreed to a claims process against Nortel, and all proof of claims must be submitted by the bar date of September 30th. Information on the process, the proof of claims form, and a guide may be found on the Ernst & Young (Monitor) web site which may be accessed from the links shown on the right hand side of this page.
In the Canadian case, Koskie Minsky is acting on behalf of former employees and retirees and in the latest newsletter KM explains that they will be carrying out a simplified submission on our behalf. See: http://www.koskieminsky.com/upload/090133_WNB_5Aug09_1.pdf
The details in the KM newsletter on the claims submission are “in quotes” as follows:
“Jul 31, 2009
Canadian Claims Procedure Not Applicable to Pensioners, Former Employees or LTD Recipients
On July 30, 2009, the court approved a Claims Procedure for Nortel's creditors in Canada. .
THIS CLAIMS PROCESS DOES NOT APPLY TO CANADIAN PENSIONERS, FORMER EMPLOYEES OR LTD RECIPIENTS.
KM is negotiating a separate simplified claims process for all Former Employees, including pensioners, whereby we will prepare the original claims with data from the company and Monitor and send them out to people for verification. This way, individuals will not be in the difficult position of having to calculate and submit their own claims. All Former Employee claims will be included in this separate Claims Procedure, as will any lost benefits, including pension and health benefits. Once the process has been determined, we will post information about it on our website. LTD recipients continue to receive their benefits from Nortel and as such, do not have a claim against Nortel as yet. Should claims crystallize, Koskie Minsky as Representative Counsel will also file claims on behalf of LTD recipients. ”
Since Canadian pensioners are still receiving pension payments from Nortel, I presume that we will not be claiming for that until the pension plan is wound up. It is unclear yet as to when that will happen. It is also unclear what we will need to claim for at that time.
In the Canadian case, Koskie Minsky is acting on behalf of former employees and retirees and in the latest newsletter KM explains that they will be carrying out a simplified submission on our behalf. See: http://www.koskieminsky.com/upload/090133_WNB_5Aug09_1.pdf
The details in the KM newsletter on the claims submission are “in quotes” as follows:
“Jul 31, 2009
Canadian Claims Procedure Not Applicable to Pensioners, Former Employees or LTD Recipients
On July 30, 2009, the court approved a Claims Procedure for Nortel's creditors in Canada. .
THIS CLAIMS PROCESS DOES NOT APPLY TO CANADIAN PENSIONERS, FORMER EMPLOYEES OR LTD RECIPIENTS.
KM is negotiating a separate simplified claims process for all Former Employees, including pensioners, whereby we will prepare the original claims with data from the company and Monitor and send them out to people for verification. This way, individuals will not be in the difficult position of having to calculate and submit their own claims. All Former Employee claims will be included in this separate Claims Procedure, as will any lost benefits, including pension and health benefits. Once the process has been determined, we will post information about it on our website. LTD recipients continue to receive their benefits from Nortel and as such, do not have a claim against Nortel as yet. Should claims crystallize, Koskie Minsky as Representative Counsel will also file claims on behalf of LTD recipients. ”
Since Canadian pensioners are still receiving pension payments from Nortel, I presume that we will not be claiming for that until the pension plan is wound up. It is unclear yet as to when that will happen. It is also unclear what we will need to claim for at that time.
Saturday, August 8, 2009
US Bar Date posted on Epiq Web Site for Nortel Claims
Following the court ruling Epiq Systems has now posted the Bar Date for filing proof of claim forms on its web site. As with the Canadian CCAA process the date for filing in the US is September 30th. Proof of claim forms may be found on the Epiq Systems web site. The site may be accessed on the link shown in the right column on this page.
Docket number 1280 on the Epiq site shows the court order.
The notice indicates that Nortel should be sending out notifications to its creditors regarding this bar date. All creditors must submit claims and be listed on the schedule before this date or they are forever barred from claiming against Nortel.
The claims process in Canada is defined on the Ernst and Young web site; also a link on this page.
The following information is not an official notification from the NRPCUS committee. I am providing this to my readers so that they can make up their minds on whether to proceed with filing proof of claim forms or wait for a few days to find out what the NRPC advises.
The steering committee of the NRPC in the US has been attempting to obtain assistance from Segal to calculate claims for the paying membership of the NRPCUS. The intention was to have Nortel send an electronic file to Segal so that the information could be processed efficiently and quickly. However after much discussion, Nortel lawyers have advised the company not to provide the electronic file as it could be a breach of law in terms of privacy of individual information. This is being disputed by the NRPC steering committee. If an agreement is reached in the near term, the NRPC membership will be notified by the steering committee. This calculation assistance by Segal, if it happens, will only be used for people who are paying members of the NRPC US. All other people will have to calculate and file their own proof of claims. You can find more information on the NRPC at the website www.nnra.org.
For people who have Non-Qualified 15 year certain claims, the calculation will be somewhat simpler than those who have claims that need actuarial assistance. The number of months left in the 15 year period times the amount per month is the simplest calculation. Nortel may dispute this by arguing that a cost of future money factor needs to be introduced. At this point there is no guidance on that factor to be used. personally I plan to file a claim that is the number of months left in the 15 year period that they owe me, times the fixed monthly payment.
For people with non-qualified lifetime annuities, you will need assistance from an actuary to determine what factors and interest rates need to be used in calculating the claim. This is further complicated depending on whether it is a single life annuity or a joint survivor annuity. Each case needs individual attention, and you may need to seek professional help to determine the figure.
Once the claims are filed, Nortel may raise points of dispute if their factors differ from those used by individuals.
I will continue to provide updates on this situation as they arise. If you have specific information that may help people calculate their claims please feel free to comment and I will add it into the main postings.
Docket number 1280 on the Epiq site shows the court order.
The notice indicates that Nortel should be sending out notifications to its creditors regarding this bar date. All creditors must submit claims and be listed on the schedule before this date or they are forever barred from claiming against Nortel.
The claims process in Canada is defined on the Ernst and Young web site; also a link on this page.
The following information is not an official notification from the NRPCUS committee. I am providing this to my readers so that they can make up their minds on whether to proceed with filing proof of claim forms or wait for a few days to find out what the NRPC advises.
The steering committee of the NRPC in the US has been attempting to obtain assistance from Segal to calculate claims for the paying membership of the NRPCUS. The intention was to have Nortel send an electronic file to Segal so that the information could be processed efficiently and quickly. However after much discussion, Nortel lawyers have advised the company not to provide the electronic file as it could be a breach of law in terms of privacy of individual information. This is being disputed by the NRPC steering committee. If an agreement is reached in the near term, the NRPC membership will be notified by the steering committee. This calculation assistance by Segal, if it happens, will only be used for people who are paying members of the NRPC US. All other people will have to calculate and file their own proof of claims. You can find more information on the NRPC at the website www.nnra.org.
For people who have Non-Qualified 15 year certain claims, the calculation will be somewhat simpler than those who have claims that need actuarial assistance. The number of months left in the 15 year period times the amount per month is the simplest calculation. Nortel may dispute this by arguing that a cost of future money factor needs to be introduced. At this point there is no guidance on that factor to be used. personally I plan to file a claim that is the number of months left in the 15 year period that they owe me, times the fixed monthly payment.
For people with non-qualified lifetime annuities, you will need assistance from an actuary to determine what factors and interest rates need to be used in calculating the claim. This is further complicated depending on whether it is a single life annuity or a joint survivor annuity. Each case needs individual attention, and you may need to seek professional help to determine the figure.
Once the claims are filed, Nortel may raise points of dispute if their factors differ from those used by individuals.
I will continue to provide updates on this situation as they arise. If you have specific information that may help people calculate their claims please feel free to comment and I will add it into the main postings.
Thursday, August 6, 2009
DEMONSTRATION TOMORROW AT PARLIAMENT HILL OTTAWA
The following is a (edited) notice published on the Nortel Retirements Protection Committee web site.
In light of the emergency meeting by the Canadian House of Commons regarding Nortel, the Canadian NRPC committee has just been issued A PERMIT TO DEMONSTRATE IN FRONT OF THE PARLIAMENT BUILDINGS, FROM 9:00 AM, UNTIL 11:00, on FRIDAY AUGUST 7 2009. Arrive at 8:45 to set up.
Demonstrators has been asked to position themselves between the main stairs and the
Centennial Flame on the paved areas only. No person is permitted to block pedestrian traffic along sidewalks.
Also STAY OFF THE LAWN.
A Parliamentary committee will hold emergency hearings on the sale of Nortel Networks Corp.
The House of Commons industry committee is expected to hear from witnesses representing Nortel, Ericsson and rival bidder Research in Motion, as well the Industry Department.
The hearings will be televised, The companies were informed of the hearing on Tuesday night, and have all agreed to send representatives.
Signs must NOT exceed 16 X 24 INCHES, on 1 INCH by 1 INCH POSTS. NO SHARP POINTS ON THE POSTS. Nothing you have on your person should be able to be used as a weapon. Be careful not to be enticed by others to commit any violent act and thus discredit us.
Tell as many people as you can.
Ottawa Nortel Pensioners
In light of the emergency meeting by the Canadian House of Commons regarding Nortel, the Canadian NRPC committee has just been issued A PERMIT TO DEMONSTRATE IN FRONT OF THE PARLIAMENT BUILDINGS, FROM 9:00 AM, UNTIL 11:00, on FRIDAY AUGUST 7 2009. Arrive at 8:45 to set up.
Demonstrators has been asked to position themselves between the main stairs and the
Centennial Flame on the paved areas only. No person is permitted to block pedestrian traffic along sidewalks.
Also STAY OFF THE LAWN.
A Parliamentary committee will hold emergency hearings on the sale of Nortel Networks Corp.
The House of Commons industry committee is expected to hear from witnesses representing Nortel, Ericsson and rival bidder Research in Motion, as well the Industry Department.
The hearings will be televised, The companies were informed of the hearing on Tuesday night, and have all agreed to send representatives.
Signs must NOT exceed 16 X 24 INCHES, on 1 INCH by 1 INCH POSTS. NO SHARP POINTS ON THE POSTS. Nothing you have on your person should be able to be used as a weapon. Be careful not to be enticed by others to commit any violent act and thus discredit us.
Tell as many people as you can.
Ottawa Nortel Pensioners
Wednesday, August 5, 2009
Bar date established
The Ontario court has established a bar date for claims against Nortel. The date is Sept 30th and means that all proof of claims need to be entered and registered by that date. See http://documentcentre.eycan.com/Pages/Main.aspx?SID=89&Redirect=1. The Ernst and Young site provides details on the procedure for the proof of claims. I hope that Koskie Minsky will be issuing a communication soon with further advice.
Epiq Systems has not yet specified the bar date for the US on its web site but I expect them to update that soon. In my last contact with them they said that the court would be reviewing the date in the first week of August so we can expect to see something posted soon.
As soon as I find out more i will post it here.
Epiq Systems has not yet specified the bar date for the US on its web site but I expect them to update that soon. In my last contact with them they said that the court would be reviewing the date in the first week of August so we can expect to see something posted soon.
As soon as I find out more i will post it here.
Sunday, August 2, 2009
Social Security in Canada and USA
Whilst living in Canada I always thought that my retirement would be secure. I had the illusion that Canada cared for its citizens more than most countries, and paid especial attention to its seniors. From an outside perspective, I thought that the USA was not as concerned about the well being of its citizens until I came to live in the USA. Now I know that there is more concern here for seniors than exists in Canada. Mainly due to a failure of the Canadian government to take action to protect the pensions of seniors and to ensure that they have adequate income when they retire.
It came as a big surprise to many people when their companies went into bankruptcy and their defined pension benefits suffered as a result of Canada’s lack of insurance protection. Not so in the US or the UK where government sponsored agencies protect the pensioners by requiring companies offering defined benefit pension plans, to pay insurance premiums to protect against that very eventuality. The PBGC in the US has saved millions of pensioners from losing out, and in the UK the PPF has provided the same type of safety net.
Social security in the US is also far more than offered in Canada. Having worked and contributed for 18 years in each country I am eligible for social security in the US and the CPP in Canada. However the amount of social security I am paid in the US is three times what I could receive from Canada. Additionally my wife is entitled to half of what I receive from social security when she reaches retirement age.
The difference between these plans is due to the mandatory deductions required by each government. But the fact that Canada doesn’t require a large enough savings plan for retirement is inexcusable, especially in light of the very high income tax rate already paid by her citizens and applied to other programs.
I realize that Canada also offers an old age pension, but even when combined with the CPP, the sum is far smaller than what is provided by US social Security. I really don’t understand the reasoning that Canada’s government has used to create this shameful situation. It is even further confusing to find that the elected officials are dragging their feet, and balking at correcting the pension protection situation.
Isn’t it time that a Canadian agency was established to provide protection for retirees and future retirees who are depending on the defined benefits promised to them? These benefits are not perks or special treatment; they are part of the compensation package that the employers agreed to provide to employees. They should be fully protected and in the event of bankruptcy they should be given first priority on any assets that are left, to ensure the pension trust funds are fully funded.
It came as a big surprise to many people when their companies went into bankruptcy and their defined pension benefits suffered as a result of Canada’s lack of insurance protection. Not so in the US or the UK where government sponsored agencies protect the pensioners by requiring companies offering defined benefit pension plans, to pay insurance premiums to protect against that very eventuality. The PBGC in the US has saved millions of pensioners from losing out, and in the UK the PPF has provided the same type of safety net.
Social security in the US is also far more than offered in Canada. Having worked and contributed for 18 years in each country I am eligible for social security in the US and the CPP in Canada. However the amount of social security I am paid in the US is three times what I could receive from Canada. Additionally my wife is entitled to half of what I receive from social security when she reaches retirement age.
The difference between these plans is due to the mandatory deductions required by each government. But the fact that Canada doesn’t require a large enough savings plan for retirement is inexcusable, especially in light of the very high income tax rate already paid by her citizens and applied to other programs.
I realize that Canada also offers an old age pension, but even when combined with the CPP, the sum is far smaller than what is provided by US social Security. I really don’t understand the reasoning that Canada’s government has used to create this shameful situation. It is even further confusing to find that the elected officials are dragging their feet, and balking at correcting the pension protection situation.
Isn’t it time that a Canadian agency was established to provide protection for retirees and future retirees who are depending on the defined benefits promised to them? These benefits are not perks or special treatment; they are part of the compensation package that the employers agreed to provide to employees. They should be fully protected and in the event of bankruptcy they should be given first priority on any assets that are left, to ensure the pension trust funds are fully funded.
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