Wednesday, June 22, 2011

Judge Gross orders formation of 1114 and 1102 committees

Docket number 5783 on the Epiq site contains the order by Judge Kevin Gross for the US trustee to form a 1114 committee of Nortel retirees who are receiving benefits such as medical and long term care to act on behalf of the retirees to negotiate with Nortel to change or terminate the medical and other retiree benefit plans.

Docket number 5790 contains a similar order for the US trustee to appoint a 1102 committee to represent the Nortel employees on long term disability to act on their behalf in similar negotiations with Nortel regarding the LTD benefits.

The details of the committees are to be presented to the court for approval. There is no statement in terms of timing or the method of selection of the committee representatives. Legal fees for the 1114 committee will be borne by Nortel. A cap of $200,000 has been set in terms of the legal representation for the 1102 committee and will be borne by Nortel also.

This is the first step towards major change to these programs. It will probably take a few months but probably before of by year end.

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