Retirement traps

Morneau Shepell announces Canadian Pension Cuts

2011-07-13T13:46:00.005-04:00

The administrator of the Nortel Canada Pension plan published their estimates for reduction of the plan payments on their web site yesterday. You can find the details by using the link in the right hand column to access their site.

Basically the reductions for the non-negotiated plan members will be 30% for those who have Ontario pensions and service and 41% for those who have pensions generated by service in other provinces. That means only up to 70% and 59% of the benefit will be paid on an interim basis. I say up to because there will be an addition reduction of up to 7% to account for the fact that pensions have been paid at 100% since October 2010 and they should have been paid at a lower amount. The reduction will be based on age and the amounts paid with a cap of 7%. So people with Ontario service may only get 63% and people with pensions based in other Provinces may get 52%.

The negotiated plan has slightly different figures. The corresponding reduced pension numbers are 75% and 57%.

In Ontario there is some pension protection and the PBGF will be making up the first $1000 per month of pension for people whose pension was from Ontario. This may help raise the percentage above the 70% quoted.

People with split service will see a reduction reflecting the proportion of their service from Ontario and well as other provinces.

The reductions will occur on the August 25th 2011 payment.

Each pensioner will receive an individual letter from Morneau Shepell and there will be a webinar on July 22nd 2011 from 1:00-3:00 PM to explain the reductions

You can register for that webinar on the administrator site. (See right hand column).

You can also call Morneau Shepell at 1-877-392-2073 for the negotiated plan details, and 1-877-392-2074 for the managerial and non-negotiated plan detail.

Us Trustee

2011-07-06T15:47:00.004-04:00

The US Justice department has a group called the US Trustee. The people in that department have the mandate to oversee bankruptcy cases and make sure that the law is properly followed. The US Trustee intervened in the Nortel case when Nortel attempted to cut off retiree medical and other benefits in 2010. The Trustee was able to stop Nortel's petition and as a result Nortel had to withdraw their petition at that time. Nortel has reinitiated their plan to reduce or eliminate the medical and other benefits. However, this time they are going through the proper bankruptcy procedure by requesting that the court approve the formation of a 1114 committee. This process is currently underway and the US Trustee will be keeping a close eye on it to make sure it is per the bankruptcy codes.

It is good to know that some government agency has the retirees benefits in mind, even if it is only to ensure the courts follow the right process.

I am not sure if such an agency exists in Canada, but I would think that it would certainly be a good thing for Canadian retirees if a government agency was able to step in and have a say regarding the dispersion of the Nortel Canada Assets. Since the government there has practically thrown the retirees to the dogs by avoiding to provide pension insurance or protection, perhaps they could take some pro-Canadian steps to ensure that the Nortel Pension Fund receives payments from the assets, instead of handing large sums over to the UK and other European agencies who are trying to by-pass Canadian law to get their hands on a bigger share of the Nortel assets than they should be.

Since Nortel UK declared bankruptcy then the the UK claims should be placed against the Nortel UK assets, not the Candian assets, nor the US assets. If Canada and the US allow the UK claims and EMEA claims to be made against the Canadian and US estates it will circumvent the normal bankruptcy process in our countries and generate a precedent that will have worldwide implications. The US trustee, and if there is an equivalent in Canada, needs to get involved to make sure the proper process is followed regarding those foreign claims which have already been denied by both the US and Canadian courts. Otherwise all claims will become global and everyone will start claiming on company divisions in every countrynof operation resulting in total stalemate.

Along the same lines, both countries need to get involved in the asset allocation process. The UK and EMEA have been arguing forcefully that they should have more assets allocated to them since they have such large claims. This is simply another tactic to get their hands on a bigger piece of the pie. Their argument should be overruled. The dispersion of sold assets should not be based on claims but on other more relevant factors related to company presence, funding, sales, employees, ex employees, R&D etc.... Not claims.

Nortel patent sale posted on Nortel site

2011-07-01T12:06:00.002-04:00

Following my previous post, I checked Nortel's web site and they have posted information of the sale of the patents for $4.5b.

See:

http://www2.nortel.com/go/news_detail.jsp?cat_id=-8055&oid=100272428&locale=en-US&lcid=-1

Tom

Nortel patents sale

2011-07-01T11:57:00.002-04:00

According to Marketwatch Nortel has sold its patents for $4.5b to a consortium. See
http://www.marketwatch.com/story/nortel-announces-the-winning-bidder-of-its-patent-portfolio-for-a-purchase-price-of-us45-billion-2011-06-30?reflink=MW_news_stmp

If this is true it will be a very nice addition to the total estate that will be available for distribution.

Now they need to get the allocation process sorted out and also deal with the claims including the outrageous claims from Europe.

Then we may see some distribution against our outstanding claims.

Hopefully this will do something to help the deficit in the Canadian pension trust fund.

Asset allocation

2011-06-26T17:02:00.002-04:00

The courts have agreed to further mediation talks and some of the parties involved have been pressing to have their very large claims considered as part of these talks. Frankly I think the size of claims should not have any impact whatsoever on the allocation of assets. It's unfortunate if in Europe the companies that Nortel took over were not keeping the pension funds at adequate levels especially considering the very lenient rules required to retire in some of the European countries. I think the governments of those countries affected should have had proper regulations in place to ensure pension funding. The same applies to Canada. The pension regulations there is antediluvian.

The asset allocation needs to be determined on other attributes like product development history, sales volume, manufacturing supply, number of employees, research funding. Bringing claim size into that picture distorts the formula, in my view, in favor of those who can talk loudest and dream up the best claim stories. How is it possible that EMEA can have claims bigger than the US and Canada combined? That doesn't make any sense. It's clear to me that these claims from EMEA are not Bona Fide.

Judge Gross orders formation of 1114 and 1102 committees

2011-06-22T17:59:00.002-04:00

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.

Nortel US files for formation of 1114 committee

2011-06-05T11:53:00.002-04:00

Nortel has filed in the US court for the appointment of a 1114 committee to be established. This is the first step towards eliminating retiree medical and other non pension benefits as well as long term disability benefits. The committee will be staffed with retirees who will represent the interests of those of us who are receiving retiree medical and other benefits. I don't know who will be on that committee yet . I imagine the US NRPC will be involved since they originally were able to stop Nortel from eliminating the benefits unilaterally. Nortel claims it is costing them $12 million per year to keep supporting the medical and LTD programs for retirees and LTD employees. Considering the costs of all the lawyers now involved this seems to me to be a much better use of the estate funds than handing them over to a bunch of legal vultures who have no vested interest in the welfare of retirees or of Nortel for that matter.

Monitor's 65th report re UK and EMEA claims

2011-05-04T12:05:00.002-04:00

The Canadian monitor, Ernst and Young submitted the 65th report to the Canadian court and also copied the US court as defined in docket # 5351 on the Epiq website.

The report requests the Canadian court to address the UK and EMEA claims which have been submitted in order to expedite the process for allocation of the Nortel estate between the various countries involved. The UK and EMEA have submitted enormous claims valued at $13.5 billion Canadian and have also requested priority which would mean that their claims would be given preferential treatment and if allowed would basically wipe out any funds for Canadian unsecured creditors. This could also impact the US claimants if the US court recognized the claims.

The claims submitted by the UK and EMEA include elements that are non specific and include accusations of mis management by NNL. These appear frivolous to me and considering the fact that Canada does not insure or protect their pensioners in the event of bankruptcy ( unlike the US, the UK, and other countries in the EMEA group) I hope that the courts dismiss these claims outright and send them back to claim against their own country subsidiaries rather than taking funds away from the unsecured creditors in Canada and the USA. If the courts allow these claims then the pensioners and LTDers in Canada will get nothing to make up for the missing funds in their trusts.

Nortel files for allocation of sales assets

2011-04-26T10:07:00.002-04:00

Docket 5307 on the epic web site contains a request by Nortel to have the US and Canadian courts define a deadline and a method for determining the allocation of the funds received from asset sales. The mediation talks which involved 125 individuals broke down after months of debate and thousands of pages of information.

Nortel claims that they cannot move ahead with distribution of funds to legitimate claimants until they are able to determine the amounts of assets that are assigned to each country. Nortel also pointed out that there is a $2billion claim by Nortel US against the Canadian assets. The US group cannot determine what the US assigned assets will be until they know what the assets are assigned to both the US and Canada and also the claims percentage in Canada so that they can factor in the cash received from the Canadian estate into the US estate.

Docket 5266 on epic web site

2011-04-20T20:17:00.002-04:00

An ex Nortel employee (Robert Horne) has filed a request to the US court asking for permission to sit on the unsecured creditor's committee and speak for ex employees to obtain better support for our claims and also the access to information from Nortel which was cut off when Nortel cancelled the HR services group. You can check the details at the Epic website (see the right hand column) and look at docket 5266.

We have been cast off by Nortel and left to founder as they continue to pay the lawyers and the remaining team and no one in the court system seems to be worrying about what we are owed and the blatant disregard for any rights we may have had as ex employees or retirees. Hats off to Robert Horne for taking the initiative and trying to get some representation for us in the courts.

Tom

Canadian federal election

2011-04-18T10:44:00.002-04:00

With the Canadian federal election coming up there is a big opportunity for Nortel retirees and ex employees to show their displeasure with the current government and work to vote out the conservatives and others who refused to help secure pension funds against unscrupulous companies that let the trusts decline and then went into bankruptcy to avoid having to make up the shortfall.

Nortel also pronounced a death sentence on some of their disabled employees by raiding their fund and cutting off their source of income and yet the government stood by and watched. These people need to go and be replaced with human beings instead of the robotic, pro business, anti senior, greedy charlatans who sit in Ottawa and spew hot air.

Get organized to vote them out. Don't let them get away with what they have done. They are not representing you, they only care for themselves and their rich cronies.

Tom

Nortel mediation talks fail

2011-04-15T20:57:00.002-04:00

The Globe and Mail has reported that the mediation talks being held with all the representatives of the Nortel Creditors has failed to reach an agreement. That means this will drag out for a long time. The lawyers will make hay and spend a big share of the Nortel estate as all the parties argue over the disposition of the funds. I'm not sure what this means in terms of the courts. Check the following link and also look at the dockets on the Epiq website to see if the judge makes any new rulings. if I find anything out I will post it.
Tom

http://www.theglobeandmail.com/globe-investor/nortel-sale-mediation-process-fails/article1984248/

Nortel Canada Severance Claims- Misinformation

2011-04-11T18:15:00.001-04:00

The following information was posted on the Koskie Minsky site on April 6 2011

IMPORTANT: Incorrect Information Being Circulated re Nortel Severance Claims

There is incorrect information being circulated relating to the claims against the Canadian estate of Nortel. All employment- based claims will be dealt with through a special “Compensation Claims Process”. You will be notified about that process once it has been finalized. Your claims will be calculated for you as part of that process. You will be provided with a claims package which identifies the nature and amount of the claims that will be made on your behalf, and a summary of the data from Nortel’s records upon which your claims have been calculated. Before the claims process can be implemented, court approval will be required. Koskie Minsky and the court-appointed representatives (Donald Sproule, Michael Campbell, David Archibald and Susan Kennedy) will be conducting information sessions and/or webinars to explain the process and the basis for calculating your claims.

Please disregard any information you receive relating to the Compensation Claims Process unless it arrives from Koskie Minsky, Ernst & Young or the court-appointed Representatives. Please note that the Compensation Claims Process in Canada has not yet been finalized. It is not necessary to take any action at this time and it will not be necessary (except in very few special circumstances) to fill out a claim form. Any documentation that is delivered to Ernst & Young Inc. will not be accepted at this time.

Please contact the NRPC through their website at www.nortelpensioners.ca, or Koskie Minsky at 1.866.777.6344 or by email at nortel@kmlaw.ca if you have any questions relating to the Compensation Claims Process. However, at this time, none of Koskie Minsky, the NRPC or the Monitor are able to advise you about the amount of your severance claim because it has not yet been calculated.

Nortel's Last Gasp

2011-04-06T18:50:00.003-04:00

Nortel's last gasp

Check the following link to read a story in the Ottawa Citizen outlining the dismal failure that Canadian politicians allowed to happen to Nortel whilst other countries and governments make hay from all the hard work and research that helped fuel the rise of the digital and optical world we live in today.

http://www.ottawacitizen.com/business/last+gasp+Nortel/4565852/story.html#ixzz1IkTplylK

Google bid for Nortel Patents

2011-04-04T20:36:00.002-04:00

On Monday April 4, 2011, 2:51 pm EDT
TORONTO (Reuters) - Global Internet giant Google has bid $900 million for a warchest of patents from bankrupt Nortel Networks, in an initial "stalking horse" bid that's expected to draw in higher competing offers.

Google, which runs the world's most popular search engine, wants the Nortel patents to help it fight a growing wireless patent war against well-armed mobile superpowers. The company has pushed its Android mobile phone software to the top of the wireless heap, attracting litigation in the process.

"Google is a relatively young company, and although we have a growing number of patents, many of our competitors have larger portfolios given their longer histories," Kent Walker, Google's general counsel, wrote on the company's blog.

Nortel, which filed for bankruptcy protection in January 2009, was a pioneer in wired and wireless network technology and the assets include some 6,000 patents and patent applications for wireless, data and optical networking, voice, Internet, semiconductors and other technologies.

"As the mobile market gets increasingly litigious it comes as little surprise that Google is interested in assets that could help it defend its Android mobile platform against rival patent claims," said Ben Wood, an analyst at CCS Insight.

Oracle is suing Google over Android, while Apple is fighting Taiwan's HTC in what is widely seen as a proxy attack on Android, which runs on HTC smartphones as well as devices from Samsung Electronics, Motorola Mobility and others.

More established mobile vendors have cross-licensing deals with each other. That keeps their patent fees low but makes entrance expensive for newcomers like Apple and Google.

INTEREST ROBUST

Interest in the Nortel patents has been robust, but a deal was been delayed as Nortel's liquidators and potential buyers haggled over price.

Other expected bidders include Chinese telecom network company ZTE, Ericsson, which bought most of Nortel's wireless operations, and RPX, which licenses patents on behalf of member clients for a fee.

"This is an unprecedented opportunity to acquire one of the most extensive and compelling patent portfolios to ever come on the market", Nortel's chief strategy officer, George Riedel, said in a statement.

The patent sale is a last gasp for Nortel, once a Canadian technology darling with some 90,000 employees and a market capitalization of more than $250 billion.

Nortel, which has sold most of its physical assets, said Google was chosen after multiple bidding rounds involving companies and consortia from around the world.

"The patent war is getting tougher and expensive," said IDC analyst Francisco Jeronimo. He said it was unclear how widely the Nortel patents have already been licensed.

Google's bid sets a minimum price for other bidders to use as a starting point for their own proposals.

Nortel will file the agreement to a bankruptcy court in Delaware and outline how it will run the auction, which it expects to hold in June.

Canadian PM Harper allows abuse of disabled

2011-03-28T13:22:00.002-04:00

The following was sent to me by Dianne Urquhart

Jul 06, 2009 05:18 PM EDT

http://www.youtube.com/watch?v=Ak8NEqo2po8

OR

YouTube - Prime Minister Harper Allows Powerful to Abuse Disabled

Prime Minister Harper Allows Powerful to Abuse Disabled
Nortel disabled employees asked Prime Minister Stephen Harper to correct an abuse by their employer who provided bogus disability insurance and wrongfully removed $75 million from their health and welfare trust. PM Harper stonewalled them for 18 months, turning down two disability bills using excuses supplied to his government by the insolvency lawyers, bankers and junk bond owners who took the disability insurance of the Nortel disabled. Bankers and bond owners insure their losses with credit default swaps and yet this government assists them to make a higher return by taking the insurance money of the disabled. This money does not rightfully belong to the creditors. Since disabled persons are less than 0.9% of the workforce and the cost of disability insurance is less than 1.5% of payroll, the impact of the bills on cost of credit is miniscule. The taxpayer now foots the bill for the PM's decision and the disabled live in poverty.

The Canadian disabled thank the Liberal Party Leader Michael Ignatieff for tabling the disability bills and NDP Leader Jack Layton, Bloc Quebecois Leader Gilles Duceppe and Green Leader Elizabeth May for supporting the bills. For more information, go to www.protectourtomorrow.com.

Sent By:

Diane A. Urquhart
Independent Financial Analyst
Mississauga, Ontario
Tel: (905) 822-7618
Cell: (416) 505-4832
urquhart@rogers.com

Nortel US Claims- NUSRPC email

2011-03-09T17:26:00.001-05:00

The NUSRPC has sent out an email regarding the offers to purchase claims that some people have received. They are cautioning everyone to examine the fine print closely. There is the possibility of a clawback in many of these offers if the payout is less than expected, so be careful what you agree to.

Here is the email content:

The NUSRPC is a volunteer organization. Nothing in this e-mail is intended to be, nor should be construed to be, legal or financial advice.

Status Update

Many of us have received a letter offering to purchase our claims and this letter has prompted a number of questions to the NUSRPC. The NUSRPC has attempted to contact one firm but has not received a response to our inquiries.

However there are some general comments we can make to our members:

-There are legitimate companies who operate in this field. Their business is to provide cash for paper assets that ordinarily are illiquid, such as claims in a court case which is still in process.

-These companies may decide to offer to purchase your claim now at some percentage of its face value hoping that the claim will be resolved by the court later for a higher percentage, thus yielding a profit for themselves.

-Should you be interested in accepting such an offer, the NUSRPC strongly advises you to seek legal advice regarding the terms and conditions outlined on the document you will be asked to sign. Under certain circumstances you may be asked to pay back some or all of the money you have been paid, perhaps with an added penalty. It is important that you clearly understand those circumstances and be prepared for the possibility that you may be asked for repayment.

-We have asked Akin Gump, the court appointed attorney for the unsecured creditors for an opinion on how long it may take before the Nortel bankruptcy case is concluded. In their opinion it would not be unusual for the case to last another 12-18 months.

-If any member has specific knowledge, experience or advice related to doing business with one of these companies and would like to share it with others you may wish to join the Yahoo group and post your input at:

http://finance.groups.yahoo.com/group/Nortel_Pension

The NUSRPC will continue to provide you with updates as developments occur regarding our benefits or affecting the claims we have already filed.

NUSRPC

Persistence

2011-03-05T07:40:00.003-05:00

Liquidity Solutions called me again to ask if I was interested in selling my claim against Nortel US to them. They were offering 44cents on the dollar for the value of my claim. As I indicated in my last post, another person published on the Yahoo Nortel Pension group that he has actually sold his claim to a different company for more than 55 cents on the dollar. However he pointed out that most of these companies are interested in claims that include severance and they also want to take over your right to sue Nortel in any class action suit later. Perhaps they know something that we don't and the claims will actually be worth a lot more than they are offering.

I have also seen postings where people don't think that there will be any payback to us at all, so it is hard to know what to do exactly. I think that the people offering to buy claims have done this in the past and they have the resources to determine what the estimated payout will be. They are taking a risk however, but they must think it is worthwhile. So I am not planning to sell my claim to them. I may regret that if the payout is less or non existent.

US Claims Purchase by outside company

2011-03-02T20:52:00.002-05:00

A week or so ago I posted a message about an offer to purchase my claim against Nortel US.
Following that post there has been a lot of discussion on the Yahoo Nortel
Pension group regarding the purchase of claims.

The following message was posted by a member who followed up on the idea and actually sold his claim to a company who is in the business of buying up claims and then making money when the assets are finally settled. As you can see from the message it is a bit more complicated than at first glance.

This is the message:

About two weeks ago I read a post to the group regarding an offer to purchase
their claim in the Nortel bankruptcy. Intrigued, I tracked down the company
mentioned and solicited my own bid at a rate of 40 cents on the dollar.

Thank goodness I live by the old axiom "never accept the first offer". I did
some research and came up with the names of four other companies that are
snapping-up claims........and proceeded to contact each of them. The LOWEST
rate I was offered was 55 cents on the dollar. Ultimately I sold mine for even
better than that. Didn't even have to wait for a check........they sent an
electronic fund transfer on the same day I returned the form.

Any of you receiving a bid absolutely MUST read the fine print in the contract.
In addition to withholding 35-40% for taxes (court mandated for severance
claims), several offers came with caveats that could lead you to serious
exposure to legal fees and other forms of financial jeopardy.

Seller beware!

A small footnote that will be frustrating news to some. All 5 companies I dealt
with were only interested in purchasing claims for which a severance contract
was included and an amount was "scheduled" on the claim form. That doesn't
necessarily mean people laid off without a severance agreement will not receive
compensation eventually. But it does mean you probably can't sell your claim.

Lawyers get paid as Nortel's case drags on

2011-02-26T08:08:00.003-05:00

Recently, things have been quiet on the Nortel US bankruptcy as the court considers a variety of issues. Whilst we wait to see what is gong to happen to our case, and our claims, multiple lawyers are constantly receiving payments with money taken out of the remaining Nortel estate. Yesterday alone, there were 14 applications for compensation by a number of different law firms as listed on the court dockets published on Epiq.

So far there has been little communication on the status of the discussions of various representatives regarding the allocation of the estate between various geographies. The longer they drag that out the more money will be paid to all those lawyers and the less will be left for claimants.

Canadian pension cut Back

2011-02-24T14:18:00.002-05:00

According to latest news published on the NRPC web site Morneau Shepell has informed the NRPC that the Canadian pension cut back will probably not be before May. Also there will be a notification to everyone 60 days before the cut back takes place.

Bill C-501 no longer includes pensions

2011-02-21T10:59:00.003-05:00

The Canadian politicians using all their back room skills managed to torpedo the pension references in the bill so that now it only addresses termination and severance payments.

Once again the Canadian government has shown how little it cares for the elderly and the disenfranchised. There was never any intention by those in power to support the Nortel pensioners in their time of need. Instead they played along, made promises and lied in order to buy time and to work deals to ensure that we pensioners once again are pushed to the bottom of the heap. Our plight and the desperate situation of the disabled Nortel people means nothing to these professional leeches.

Instead of living under the dictates of a single authoritarian like those Middle Eastern countries now in turmoil, Canada appears to live under the dictates of an anointed few who care nothing for the real people. Is that really democracy?

Morneau Shepell approves new pensions at 50%

2011-02-17T10:35:00.002-05:00

As stated on the Koskie Minsky web site, it has been decided to offer the commuted value of new pensions to Nortel people at 50% of the full pension value and also provide the opportunity for disabled people who are not yet pension age to also take out their commuted value at the 50% level.
The details can be seen at:

http://www.koskieminsky.com/Case-Central/Overview/Status-Of-Case/?rid=107

I presume that this is an interim decision to offer 50% and that adjustments will be made when the final proper ratio is determined for the pension fund.

Offer to purchase claim

2011-02-14T14:56:00.002-05:00

I received an interesting call today from Liquidity Solutions. They are making offers to unsecured creditors of Nortel to purchase claims at 40 cents on the dollar. I think that may be a good indication that the market thinks the Nortel estate will be worth more than 40 cents on the dollar. in fact I received an email from a colleague who had seen discussions that the outstanding Nortel bonds are selling around 80 cents.

So I think I am going to hold off selling at this point. Liquidity Solutions are sending me information about their offer. When I receive it I will post it here. I presume that this is related to the Nortel US company since that is the only one I have a claim against at this point

Here is some information on the bond sales sent to me by the colleague I mentioned above.

http://www.theglobeandmail.com/globe-investor/investment-ideas/streetwise/nortel-bonds-on-the-rise-again/article1884627/

http://ipfinance.blogspot.com/2011/02/latest-on-nortel-bidding-war.html

http://online.wsj.com/article/0,,SB10001424052748703960804576120463615113454,00.html

Bill C-501 status by John Rafferty MP

2011-02-13T14:58:00.002-05:00

From Canadian House of Parliament

John Rafferty, MP. (Thunder Bay-Rainy River)

Week of February 11-17, 2011.

With the new session of parliament in full swing I’d like to give an update on Bill C-501 which is still making it’s through the legislative cycle. There have been some recent developments in regard to the bill and the way forward has become clearer in recent days.

Despite some erroneous media reports Bill C-501 is in fact alive and well and is continuing its journey through parliament. On occasion, the parliamentary process can be quite complex and it would seem that a few media outlets have misunderstood the impact of some recent developments. I just wanted to clarify first, and above all else, that C-501 will in fact be heading back to the House for a final vote sometime this spring.

Some of the confusion about the status of C-501 came with the defeat of a motion in the House of Commons that related to the bill. I realized that there was still some opposition among primarily Conservative, but also Liberal, MPs to the idea of putting pension plans ahead of banks and large financial institutions so I put forward a motion that could have enabled a compromise amendment to be negotiated between our parties. In short, I asked the House of Commons for permission to amend C-501 at the Industry Committee so that pensions and severance pay would be placed in the middle of the list of creditors during restructuring and bankruptcy proceedings instead of at the very front which the bill sought to do in its original form. Unfortunately, this motion was defeated but the bill itself remains alive and has not been impacted.

The type of motion that I tabled is known as a “Motion of Instruction” and it required the unanimous consent of the House of Commons in order to pass. The motion itself would have only allowed the negotiation process on C-501 to begin and empowered the Industry Committee to make a compromise amendment if it so desired. Putting pensions behind banks but ahead of all other creditors seemed like a common sense compromise and could have made it easier for many Conservative MPs to support the bill since it would have shielded the big banks from any and all fallout that could occur as a result of them being bumped down a notch in the list of creditors and being placed behind pension plans. However, instead of allowing a compromise to be negotiated in the Industry Committee, the Conservatives refused to grant their approval to the negotiation process and rejected the very idea of working together on the issue. This regrettable decision by the Conservatives was not shocking, but it was disappointing.

While my efforts to work with the other parties to reach a compromise on C-501 were essentially killed by the Conservatives the bill itself is still very much alive and kicking. As I write this column, C-501 is presently scheduled to be examined for a final time at the Industry, Science, and Technology Committee on Tuesday February 15th. There will be some minor amendments made to the bill to clear up some language issues, but I am not expecting any significant changes to be made to its content.

Once this last committee meeting is over with and the final version of C-501 is returned to the House there must be two further hours of debate and then a final vote at what is called ‘Third Reading.’ The two hours of debate are likely to occur in March or early April and the final vote is expected in early-to-mid April. In this final vote the support of the Liberals will be crucial to getting C-501 passed and moved into the Senate. If the Liberals show up and support this bill and agree to put the interests of pension plans and retirees ahead of banks and primary lenders, then the bill will move into the Senate where a new battle begins against those unelected and unaccountable Conservative senators; but we’ll cross that bridge when it comes.

So that is where C-501 is at presently – alive and well and moving forward. We now know that the bill will emerge from the Industry Committee sometime in the next week, and be back into the House in its final form for debate and a vote in the next 60 days. Had the Conservatives simply shown a willingness to cooperate on the bill and create a more moderate and workable version then its speedy passage could likely have been guaranteed. With that being said, there is still a lot of support among MPs for putting pensions and retirees ahead of banks, so my staff and I will be working hard in Ottawa to get the Liberals and Bloc on board and to ensure the bill makes it into the Senate. After that anything is possible.

nortel patent sale delayed

2011-02-12T16:40:00.002-05:00

According to a story on Reuters, the sale of Nortel patents has been delayed. It was hoped that the sale of the patents would realize close to $1B. According to Reuters Nortel has not been able to get a high enough starting bid on the patents.

See http://www.reuters.com/article/2011/02/10/us-nortel-patents-idUSTRE71978620110210

There are 4000 Patents registered with the US office and around 1500 Canadian patents.

Any cash generated by the sale of the patents will help raise the final Nortel estate that will be split between creditors in multiple countries.

Nortel disabled take battle to Supreme Court

2011-02-10T10:45:00.000-05:00

Toronto Sun

Nortel disabled take battle to Supreme Court

By SCOTT TAYLOR, QMI Agency

Last Updated: February 8, 2011 4:05pm

OTTAWA - For a group of former Nortel employees who had their long-term disability, health, dental and pension benefits cut off at the end of last year, there is nowhere to go but up.

The workers will stage their final stand outside the Supreme Court in their long-running attempt to be moved closer to the head of the creditor line when the dying company's assets are finally doled out.

The disabled workers object to a $57-million sunset deal negotiated by a court-appointed monitor with the company in February 2010.

In that deal, Nortel agreed to fund long-term disability benefits until Dec. 31, 2010. In exchange, the employees lost their right to sue the company and any of its executives over the drastically underfunded trust account Nortel had supposedly self-insured.

As common creditors, they can expect an average of only 34% of what they had been receiving up until the end of last year.

Once Nortel is legally out of business, the workers will find themselves in a pool with other common creditors fighting for a small percentage of the dead company's assets.

Unable to work, many are afraid they won't be able to afford expensive medications and bills without going on social assistance.

Mark Zigler of Koskie Minsky LLP, the court-appointed law firm representing the former workers, has repeatedly said court battles would be costly and doomed to failure.

Toronto attorney Joel Rochon came on board on an unpaid retainer last year and is leading the fight for the disabled with independent financial analyst Diane Urquhart.

No court date has yet been scheduled.

scott.taylor@sunmedia.ca

Nortel Canada Tel. No. discontinued

2011-02-08T11:47:00.002-05:00

The following post was made on the Yahoo Nortel Pension Group regarding a message from Don Treen to NRPC members concerning the discontinuance of the 1-800 telephone number in Canada for Nortel.

We have been informed by Nortel US that the Canada 1-800 number for updating personal information with Nortel is no longer active. The number now is 1-919-905-9351. We had not been previously advised that this was going to occur and are disappointed that this step was taken without consultation with any of the employee/retiree representatives. Please ensure that if you have recently moved or had other personal life changes that you make the necessary changes to your records by calling the above number. You should put this number in your personal papers in the event that future changes need to be made.

Donald Treen
NRPC

Deferred compensation Nortel US

2011-02-06T17:28:00.006-05:00

Docket 4840 on the Epiq web site contains a letter submitted by Daniel Ray on behalf of himself and acting with the approval of Nortel outlining the deferred compensation plan of 2000 that has impacted over 400 ex employees. His letter supports the company's position that the money in the fund is part of the general account and as such is only considered a claim on the estate as an unsecured creditor. His submission contains lots of attachments which outline the steps taken by Nortel to inform participants of the risk involved.

Unfortunately there is no other option according to Daniel Ray, although the company has been continuing to pay the deferred compensation to plan participants since the filing in 2009.

There have been multiple objections filed by plan participants affected, including at least one widow who has depended on these payments as a sole source of income. In spite of the fact that this money is real salary earned and set aside for future payments, Nortel is choosing to confiscate the money and deny the participants in the plan any hope of recouping all the moneys they earned. Instead they now join the queue of unsecured creditors who will be fighting over the remainder of the Nortel estate.

Considering the bonuses paid out to the remaining management in Nortel, this move smacks of Shylock extracting a final pound of flesh from the victims of Nortel's disdain and inhumanity. A once honorable and compassionate company appears to be guided now by charlatans and shysters.

Tories kill NDP pension bill compromise

2011-02-03T17:19:00.002-05:00

The following information was presented on John Rafferty's web site. Looks like Bill C501 is running into hard opposition from the Tories who seem to be puppets for the banks and bondholders.

Tories Kill NDP Efforts To Reach Compromise On Pensions
Wed 2 Feb 2011

Motion could have protected banks, secured pensions during bankruptcy proceedings

OTTAWA – Today, Conservative MPs refused to grant their consent to a New Democrat motion in the House of Commons that would have allowed a compromise deal to be reached on Bill C-501, to secure pensions and severance pay for millions of Canadian workers when their employers entered restructuring or bankruptcy proceedings. It would also have shielded banks from any risk associated with the proposed change.

“The majority of Conservative MPs voted against C-501 at Second Reading because they said putting pension deficits at the top of the creditors list would have posed too great a risk to our banks and primary lenders,” said John Rafferty (Thunder Bay – Rainy River) the New Democrat MP who tabled the bill.

“The motion I tabled in the House today would have allowed the Industry Committee to consider a compromise amendment to the bill that would have eliminated the risks to banks and secured creditors entirely while ensuring that pensions and severance pay of millions of workers was more secure in bankruptcy proceedings. Sadly, the Conservatives would not consent to the motion and thus rejected the very idea of reaching a compromise on the matter.”

When asked who was behind the Conservative decision to defeat the motion Rafferty said he had a pretty good idea. “In a Westminster system of parliament such as ours it is the House Leaders in the individual party caucuses that are responsible for giving directions to their MPs to support or oppose such motions,” Rafferty noted. “As the Conservative House Leader, John Baird (Ottawa West - Nepean) had to have been the one who gave the orders to Conservative MPs in the House to oppose this motion.”

Rafferty said the Conservatives’ determination to defeat what was a fairly benign motion defied basic common sense. “It’s hard to imagine Stephen Harper’s Conservatives opposing a motion to allow a compromise on a bill to help millions of Canadians – but they did just that,” he said. “Mr. Baird in particular should have gone out of his way to encourage negotiation and a compromise on this issue given what transpired at Nortel. Instead, he basically vetoed the idea of reaching a compromise.”

Despite the setback, Rafferty said he will continue to lobby hard to get C-501 passed at Third Reading in the House of Commons and into the Senate before the summer.

“There is a strong moral case that the pensions and severance pay of workers should come before banks and large financial institutions during corporate restructuring and bankruptcy proceedings,” he said. “It passed one vote already, so MPs clearly see the importance and necessity of such reform.”

No impact on cash from Nortel accounting rule change

2011-02-02T11:20:00.003-05:00

Earlier I posted an announcement from Nortel regarding an accounting change that would include a charge of $2B. At that time I wondered if that change would impact the cash left in the Nortel estate when it finally goes under.

I received the following comment from a memeber of the NRPC team, which indicates that there would be no impact

There is no direct cash impact on any of the country estates. Koskie Minsky has checked this out for us. This is strictly an accounting issue on how charges are allocated now that subsidiaries are being sold.

Rafferty Petition on Pension Security

2011-01-31T18:19:00.004-05:00

John Rafferty (NDP) MP for Thunder Bay - Rainy River has initiated a petition asking the Government to enact legislation to ensure Pension Security.

This petition is being sent to pensioners and former employees of many other Canadian companies caught in the middle of bankruptcy proceedings.

This petition is in support of Bill C-501.

All Canadians should sign this petition and send it back to Mr. Rafferty's office. No postage is required in Canada. This new bill is intended to help all Canadians who may suffer a loss of pension due to company bankruptcy.

Mr. Rafferty will arrange for supportive MPs of all parties to present these petitions in Parliament as often as possible.

Mr Rafferty's web site is http://johnrafferty.ndp.ca/

Canadian Supreme Court rejects UK Pension claim

2011-01-29T09:47:00.002-05:00

The following story was on http://news.sympatico.ca/ - Jan. 27, 2011.

Supreme Court of Canada rejects U.K. Nortel pensioners claims in Canada

27/01/2011 6:08:00 PM

The Canadian Press
TORONTO - Canada's top court has dismissed an appeal by the U.K. Pensions Regulator that argued it should have the right to collect funds from bankrupt Nortel Networks Corp. for pensioners in Britain.

The Supreme Court of Canada said Thursday said it would not hear an appeal from the U.K. body after an Ontario court ruled against it last March.

The leave to appeal was dismissed by the Supreme Court with costs to all respondents except a group calling themselves the Former Employees and Disabled Employees of Nortel.

The U.K. pension body had attempted to force the Canadian company to pay U.K. pensioners about 2.1 billion pounds, or about $4 billion as it is permitted under that country's 2004 Pensions Act.

Nortel representatives claimed the attempt breached the terms of its creditor agreement filed in Canada, while an Ontario judge ruled that the British regulator's actions were null and void under Canadian law.

Although the U.K. statute extends beyond the British borders, Nortel's insolvency agreement was under Canadian jurisdiction and the claim did not apply, the judge ruled.

Toronto-based Nortel, once Canada's biggest technology company and one of the world's biggest telecom equipment suppliers, has been selling off most of its business under court protection since January 2009.

Nortel sought creditor protection in the United States and Canada on Jan. 14, 2009.

NRPC townhall in Montreal on CTV

2011-01-26T19:45:00.002-05:00

The NRPC held a townhall meeting in Lasalle on January 25th. It was reported on CTV Montreal news and a short story placed on the web.

There are a number of positive comments following the article which you can see at the URL shown at the bottom of this post.

Former Nortel employees fighting to save pensions

Nortel pensioners attend a meeting in LaSalle (Jan. 25, 2011)
Updated: Tue Jan. 25 2011 2:56:16 PM

ctvmontreal.ca

LASALLE — Some of Nortel's former employees met in LaSalle Tuesday, and they were not impressed with what they heard: many are likely to see their pensions be cut in half in the months to come.

Nortel filed for bankruptcy in January 2009, and pensioners and other ex-employees soon learned that they come toward the end of the long list of creditors.

Employees like Ken Lyons say they should be at the front.

"It is a most important issue and it's one thing, we've got all the opposition parties in agreement with us," said Lyons.

The company had already shortchanged its pension plan by about $2.5 billion because it was self-insured, and according to Canadian law, pensioners are considered unsecured creditors.

Funds from the pension plan were transferred to bonds when Nortel declared bankruptcy, and the bond market has not performed as well as the stock market.

Ever since the former employees have banded together and lobbied the federal government to change the law regarding pension plans and those for disabled employees.

However that now seems very unlikely, since last November the Conservative majority in the Senate's banking committee recommended against passing bill S-216, which would have permitted employees who were on long-term disability plans when Nortel went under to extend their benefits.

"We'll remember at election time," vowed Lyons.

3,500 former Nortel employees live in Quebec.

http://montreal.ctv.ca/servlet/an/local/CTVNews/20110125/mtl_nortel_110125/20110125/?hub=MontrealHome

Nortel Cost of Sales Accounting change

2011-01-24T17:56:00.002-05:00

The following note was published on the Nortel web site. As noted the change will result in a non-cash charge of $2 billion. I hope that means the change will not impact the estate cash available for settling outstanding claims.

Nortel cost of sales

NORTEL ANNOUNCES CHANGE IN ACCOUNTING FOR U.S. SUBSIDIARIES

January 13, 2011

Nortel* Networks Corporation (OTCBB:NRTLQ) and Nortel Networks Limited (together, Nortel) announced they have now determined that Nortel’s U.S. subsidiaries and the subsidiaries they control will be deconsolidated and accounted for under the cost method of accounting, effective as of October 1 2010.

This change is largely based on Nortel’s work toward standalone debtor estates due to the diminishing interdependency between the estates primarily resulting from the sale of substantially all of Nortel’s global businesses. The change in accounting is currently expected to result in a fourth quarter 2010 non-cash charge of over US$2 billion, subject to finalization of Nortel’s year end close process. The charge is primarily related to the recognition of intercompany liabilities between the Canadian estate and U.S. estate that previously were eliminated upon consolidation of the financial results.

The estates continue to work together toward fulfilling Nortel’s obligations under the transition services agreements with purchasers of its sold businesses, as well as in other areas such as efforts to optimize the value of Nortel’s intellectual property portfolio.

As previously reported, Nortel will continue to evaluate the method of accounting for all its subsidiaries.

For more information, visit Nortel on the Web at www.nortel.com . For the latest Nortel news, visit www.nortel.com/news .

Nortel Canada Disable get a tax break on HWT payout

2011-01-23T12:30:00.004-05:00

The following story was presented in the Toronto Sun last week. According to the reporter, the Nortel disabled employees in Canada will get a small break here in that they won't have to pay tax on any payout from the HWT trust.

News Canada
Nortel disabled benefits to be tax free
By SCOTT TAYLOR, QMI Agency

Last Updated: January 13, 2011 8:48pm OTTAWA
- The tax man is giving disabled Nortel employees a break.

Canada Revenue Agency won't be collecting taxes on the payments the workers get from their underfunded health and welfare trust.

On Dec. 31 the roughly 400 disabled employees lost their disability, health, life, dental and pension benefits. They're now left as common creditors, meaning they'll get only an average of about 34% of what they had been living on.

Many are afraid that they won't be able to afford their everyday bills, much less expensive medications. Most are unable to work.

"This is the first really good news we've heard," the workers' court-appointed representative, Sue Kennedy, said Thursday. "Any little help is better than no help at all."

Kennedy also said that she recently met with Government House Leader John Baird, who said the government is looking into ways to further assist the workers, though as yet nothing concrete has been offered.

The employees were thrust into this position because Nortel drastically underfunded its trust fund.

A group of about 30 of them have been fighting to move closer to the head of the line when the company's assets are doled out.

The Ontario Court of Appeal denied a leave to appeal motion brought by a group Jan.7. They were given 60 days to decide whether to take their case to the Supreme Court of Canada.

Meanwhile, Nortel said it will incur a $2-billion charge for a new accounting method related to the sale of its operations.

scott.taylor@sunmedia.ca

NRPC Townhall information presented.

2011-01-20T11:33:00.005-05:00

The NRPC held a townhall meeting on January 14th for NRPC members in Ottawa. There are 4 other town halls scheduled for later. You can find out more information by going to the NRPC site. Members of the NRPC can access the information presented in the members' section. (See link in right hand column). The slides used in the meeting were also posted on the Nortel Yahoo group by a group member. at:

http://f1.grp.yahoofs.com/v1/AFw4TTraK296tWxhqr6KJwHSzfVJhhyCL1LvxxRxfNmh27oLvDa-hRq5d76-TymJVqApEoqano51j_GzSVFrs_iYgMFS/%20NRPC%20/11.01.14%20yow%20%20townhall%20presentation%20%20v1.pdf

The NRPC has presented information on topics that are important to all Nortel ex-employees including political action,pension plan status, FSM model,the HWT decision, Morneau Sobeco, estimated timeline etc.

It looks like the reduction in pension will occur sometime in the second quarter 2011 and will be timed to coincide with the start of Ontario payouts from the PBGF.

According to a voicemail message I received today Koskie Minsky will not participate in this webinar but will hold one later in the year, probably during the second quarter.

NRPC Webinar January 28th

2011-01-20T11:27:00.001-05:00

The following information was posted on the Koskie Minsky web site:

Developments
January 14, 2011 NRPC WEBCAST FOR PENSIONERS, SURVIVORS AND FORMER EMPLOYEES OF NORTEL – JANUARY 28th, 2011

The NRPC is hosting a webcast on January 28th, 2011 from 1:00 – 3:00 Eastern to provide an update for those unable to attend one of the five NRPC town hall meetings that are being held during January. The webcast will cover progress on political actions, replacement insurance and topics for terminated employees. Legal actions will not be covered during this NRPC webcast and Koskie Minsky will not be represented on the call. Further Koskie Minsky webcasts will be scheduled in the future so please visit our website regularly for announcements about upcoming webcasts.

Participants who wish to register for the NRPC’s January 28 webcast can do so through the following link:

http://www.bellwebcasting.ca/audience/index.asp?eventid=28512209

Anyone without Internet access can call dial-in (listen only) by first registering through Koskie Minsky. Please leave a voicemail with your name and telephone number on the Koskie Minsky hotline at:

1-866-777-6344 between January 17th – 26th.

A representative will contact you to provide the dial-in number for the webcast

Morneau Sobeco response to some questions.

2011-01-18T16:54:00.003-05:00

Late last year I wrote to Morneau Sobeco for some clarification on a few items regarding the wind up of the Nortel Canada pension plan.

The following information was provided to me by one of their representatives working on the Nortel plan.

1) The reductions in pensions will occur as soon as we have determined the appropriate funded level of the plan. You will receive notification in writing before this reduction takes place. We will not wait until the wind up report is approved. Reducing pensions early in the wind up process does help minimize the impact of any overpayment to pensioners at the end of wind up process.

2) Claims have already been made against the estate of Nortel. This occurred prior to Morneau Sobeco's appointment and we continue to be involved in the negotiations. Any settlement would be included in the assets used to determine the wind up funded ratio and ultimately affect the final payments. The timing of the settlement will determine if it can be included in the wind up payments or be dealt with after the wind up payments have been completed.

3) Indexing is not considered in the calculations for the PBGF coverage. Normally Indexing ends immediately when an Ontario plan winds up and annuities are purchased without indexing in respect of members in receipt of a monthly pension. However, Nortel is very different from most pension plans and no decisions have been made yet regarding what options members will receive after the wind up report has been approved.

If you would like any further information, you could contact Morneau Sobeco at (877)392-2074.

Objection to NNI taking over deferred compensation trust

2011-01-16T18:35:00.003-05:00

On December 22, 2010 Nortel filed a motion before the court as outlined in docket 4638 to seek relief regarding the "rabbi" trust that holds the funds placed in there by Nortel employees who thought they were deferring salary to be paid to them at a later date out of the trust.

Unfortunately the trust was established in such a way that Nortel could take back the funds without any fear of legal action by the employees who had, in good faith, placed part of their compensation into the trust.

A number of employees have been receiving monthly or quarterly payouts from that trust believing that it was secure and was their own money. After all they had earned it and had simply placed it into the trust to be deferred until a later date. The money is not a severance, nor a pension, nor a promise. it is actual earnings that they owned, not Nortel.

However the sneakiness of the "Rabbi" trust system allows Nortel to plunder it without repercussion and take it away from the people it belongs to. All legal.

One person so far has objected formally to this plunder. See docket 4710 published on January 13th 2011.

I suggest that others who are impacted by this also place objections before the court. It may cause some re-thinking.

Nortel Canada disabled appeal denied in Ontario court

2011-01-13T12:43:00.002-05:00

The following paragraph was included in a story in the Ottawa Citizen yesterday.

The Ontario Court of Appeal has denied dissenting Nortel disabled employees the right to appeal the division of an $80 million health and welfare trust. The group is considering an appeal to the Supreme Court of Canada. There is only enough money in the underfunded trust to support about 35 per cent of long-term disability survivor benefits for widows and life insurance coverage for pensioners. Benefits were cut off at the start of this month and it will take many more months to determine how much more the groups will receive from other Nortel assets.

Read more:
http://www.ottawacitizen.com/business/Alcatel+duck+payment+probes/4095987/story.\
html#ixzz1ApvNIWN3

Nortel Dallas Campus up for sale

2011-01-10T17:44:00.002-05:00

The following story was published in the Dallas Morning News today:

05:37 PM CST on Friday, January 7, 2011

By STEVE BROWN / The Dallas Morning News
stevebrown@dallasnews.com

One of the biggest suburban office campuses in the Dallas area is up for grabs. Real estate brokers at CB Richard Ellis have been hired to market the more than 800,000-square-foot former Nortel headquarters on North Central Expressway in Richardson.

The two-building Telecom Corridor complex includes a 16-story tower and a three story, almost 400,000-square-foot research and development center. Most of the high profile property is now vacant. Owner Nortel Networks has been in bankruptcy for the last year.

“It’s an orderly bankruptcy liquidation, and everything is being approved through the court,” said Gary Carr, executive vice president in CB Richard Ellis’ investment property division. “We are going to try and get it moved by April.”

International defense and high-tech conglomerate Raytheon Corp. recently looked at buying the property. But the deal never closed. “Raytheon was very close to consolidating and taking the building at one point,” Carr said. “It’s the largest block of office space like this in the Metroplex.

“It represents one of the best corporate relocation potentials in the area,” he said.

The buildings were constructed in 1991 and at one time housed thousands of Nortel workers. They are within walking distance of a DART light rail station. Ericsson and Avaya Inc. currently lease about 30 percent of the buildings. Carr, who’s working on the sale with CB Richard Ellis’ Russell Ingrum, Jack Fraker and Josh McArtor, said the plan is to sell both buildings to the same buyer. “It’s a landmark that stands out architecturally,” Carr said.

Georgia's New Tax Plan will negatively impact seniors

2011-01-08T12:35:00.002-05:00

Currently in Georgia, seniors may earn up to $30,000 from pensions or retirement savings interest without paying state taxes on it. This ruling was put in place to help seniors survive on a fixed income. It was also meant to attract out of state seniors who might otherwise consider moving to tax free states like Florida,Tennessee, or Texas to retire in.

Now a new plan is being proposed that would eliminate that exemption, and also add a new state sales tax to life necessities such as groceries.

The new Georgia tax proposal is simply a ruse to increase taxes on seniors and the poor, and give tax breaks to businesses and the wealthy. It means a huge reduction in disposable income for seniors, and a jump in the cost of living that will not be reflected in any social security increase. Is this what they mean by fair tax?

With the rush of Georgia to become a single party state with a business first attitude, and a focus only on the desires of the rich and their lobbyists, who is going to speak for and protect the old, the weak and the poor, a cultural value that our country used to pride itself on?

With this Georgian attitude, Florida looks better all the time to the large and growing population of Georgia seniors. How is it going to help Georgia when all the money they spend moves south?

Canada's ill treatment of disabled.

2011-01-06T12:29:00.004-05:00

The following was sent to me by Diane Urquhart who is fighting to help the Nortel Disabled as they face incredibly inhumane treatment by the Canadian government and the bankruptcy courts.

A most telling statistic is the picayune benefits provided by Canada as compared to more humane countries like the UK and the US.

For example a disabled parent with 2 children receives annually:

In Canada $18,408.

In the USA $48,780.

In the UK $47,509.

What has happened to Canada? Where is your conscience? Your government has apparently turned you into a bunch of right-wing money grubbing capitalists with no compassion. That's not the Canada I knew. Time for Canadians to waken up.......

Article follows:

Nortel employees seek legal clarity around health and welfare trust

Diane Urquhart | January 05, 2011

The dissenting disabled employees of Nortel have filed a leave to appeal to the Court of Appeal of Ontario to gain a last minute reprieve from the life of poverty and medical crisis they feel they will face now that their health and welfare trust (HWT) has been terminated, a move that went into affect on Jan.1, 2011.

A decision on whether the appeal will be heard is expected to come soon.

Many Canadians with disabilities live in poverty due to grossly inadequate Canada Pension Plan (CPP) disability income. A single person with a disability receives a maximum of $13,521 per year. A disabled parent with two children receives only a maximum of only $18,408 per year. Nortel disabled employees have average medical costs of $7,200, with one at $50,000 per year.

These benefits are under par when compared to benefits in the U.S. and U.K. In the U.S, a disabled person with two children gets $48, 780 per year from Social Security and the U.K. Pension Protection Fund provides for $47,509 a year.

This appeal will define whether vested pensioner life insurance benefits are the legal obligation of the employer or of the legally distinct HWT. If the court precedent is for vested pensioner life insurance benefits to be legal obligations of an HWT, 1.1 million Canadians in self-insured disability income plans had better opt out of their employer plans and seek personal disability insurance coverage.

The actuarial liabilities for disability income are always a small proportion of the total actuarial liabilities for pensioners vested life insurance benefits and disability income due to only 0.9% of the workforce is disabled. HWT’s are generally not fully funded. When deficient HWT assets are used to pay both pensioners life insurance and disability income on an HWT termination, the disabled get deeply compromised.

In his Nov. 9, 2010 decision, the Nortel Companies’ Creditors Arrangement Act judge, Justice Geoffrey Morawetz, added the following words to interpret the meaning of future benefits in the 1980 Nortel HWT Trustee Agreement termination clause: “claims that would certainly have been made in the future.” The termination clause says: “The trustee shall also determine on a sound actuarial basis the amount of money necessary to pay and satisfy all future benefits and claims to be made under the plan in respect of benefits and claims up to the date of notice of termination.”

The added words allow a lump-sum payment of $3,500 each to the 10,000 living pensioners from the HWT. The 400 disabled are left with a lump-sum settlement from the HWT that funds just 27% of their disability income until age 65, death or recovery.

The leave to appeal asks that legal interpretation of “future benefits and claims” be made in the context of “incurred claims.” Under accepted insurance and actuarial principles and practices, future benefits relate only to incurred claims for insured events that have already occurred prior to the termination of the contract. Deaths benefits for living pensioners are not incurred claims, because the insured event of death has not occurred prior to the termination of the HWT.

Justice Geoffrey Morawetz’s Nov. 9, 2010 Nortel HWT decision conflicts with Canada Revenue Agency (CRA) rules for HWTs. The income tax act has had a clause since 1979, of no tax deduction for employer contributions paying for life insurance beyond the current year. The Nortel HWT has always had pensioners’ group one-year term life insurance policies that are automatically terminated upon Nortel’s receivership or bankruptcy. CRA ruling documents clearly say that HWT’s have no liability for future life insurance premiums and must not have a permanent surplus.

On the other hand, future disability income is part of the incurred claim from the onset of disability before the HWT’s termination. According to a 1979 CRA interpretation bulletin, a self-insured disability wage loss replacement plan is to operate on insurance principles and like “an insurance plan.” So, the HWT does have a legal obligation to pay the future income of the disabled beneficiaries.

The 1998 Canadian Pacific Railway law case reinforces that HWT assets funding future disability income are not a contingent reserve, but a legal obligation.

It is surprising that income tax act rules for HWTs, which are a CRA defined vehicle, have been ignored by Justice Geoffrey Morawetz and the counsel representing the employer, court monitor, pensioners, and the disabled and continuing employees.

The appeal will clarify whether income tax rules for HWTs and insurance and actuarial principles and practices may be ignored in the interpretation of HWT trustee agreements.

Diane A. Urquhart is an independent financial analyst working as a financial expert in class actions, bankruptcy proceedings and governments hearings on legislative reform and regulatory enforcement of securities, pension plans and health and welfare trusts.

Mediation

2011-01-05T12:19:00.002-05:00

It has been a while since I heard anything about what is happening on the mediation talks between all the parties trying to determine the allocation of Nortel Estate assets between countries. I spoke to a representative of Koskie Minsky about a month ago and she told me that they were participating. I also expect that the monitor Ernst and Young is there as well. I don't know if the Canadian Government is represented though I would think that the CRA has a big interest. The creditor's committee is most likely involved, which means that the PBGC is in there looking after the USA pension trust fund that pays retirees in the US when companies go bankrupt. The UK is in there with their pension protection fund people and they have an outrageous sized claim on the global estate. So where is Canada?

It would be nice if Koskie Minsky gave us a hint of what is happening, or the NRPC for that matter. This mediation will have a huge impact on all claimants whether in the US or Canada but the Canadian pensioners and LTD people will be directly impacted since they are waiting on the resolution to understand if there will be any assistance to them for their pensions and disabled payment benefits. Retirees in the USA and the UK are already covered by their respective governments up to the limits and within the rules of those organizations, but the Canadian pensioners are at the mercy of the courts and the administrator where their pension is concerned.

A decision in favor of Canada may negatively impact other country claimants but it will have no impact on the basic qualified pensions that are being paid to retirees in the US and the UK. It will have an impact on retirees in Canada since their pension trust fund is underwater and has a claim against the estate which if paid out could help enhance the amount of pension they receive. The same situation exists for the Canadian Disabled people who have virtually nothing in the portion of the HWT fund that they were allocated by the court. They have a claim against the estate for the money promised them and a payout there would make a huge difference to them.

I don't understand why we are not being kept better informed on the progress of this and other items such as Morneau Sobeco's progress on determining the funding ratio of the fund.

Canadian NRPC Town Hall Meetings 2011

2011-01-03T09:08:00.004-05:00

In the latest newsletter the Canadian NRPC has announced that there will be a series of town hall meetings in 2011. The following meetings have been set up:

Jan 12 Belleville 10am-noon Greek Hall
70 Harder Dr.,Belleville, ON, K8N 4Z5

Jan 14 Ottawa noon-2pm Nepean Sportsplex
1701 Woodroffe Avenue, Ottawa, K2G 1W2

Jan 18 London 1pm-3pm Marconi Club,
120 Clarke Road, London, ON N5W 5E1

Jan 20 GTA 10am-noon Mississauga Conv. Centre
Derry Rd at Hurontaio

Jan 25 Montreal Centre de recéption Sorrento
1275 Avenue Dollard, Lasalle, QC H8N 2J1
10am-noon English
1:30pm-3:30pm French

For people in smaller locations and outside Canada there will be a webinar on Friday 28th 2011 from 1:00pm to 3:00pm.

Canadian NRPC Annual dues

2011-01-01T10:53:00.002-05:00

The NRPC have issued a newsletter sent by email to their paying membership.
One item on the newsletter and also published on the NRPC website is the request for members to pay an annual dues of $20 CDN.

For those of you who wish to join or re-join you can do so by logging on to their website and following the instructions.

Personally I think the $20 fee is reasonable considering the work that they are doing to try to help us. Perhaps the fee could be waived for disabled people, and widows or widowers of retired Nortel people who wish to join.

I know that there are many Nortel retirees and ex-employees who are not members of the NRPC and that's their choice. Perhaps it's because they don't know about it, or because they just don't want to join for various reasons.

I believe firmly that all ex-Nortel people should get what ever information is out there on this situation, whether you are a member of the NRPC or not so I will continue to try to keep people informed as we go through these difficult times.

Please feel free to pass on my blog address to your friends and colleagues. However, I would like to point out that the information I place on this blog is not a substitute for being a member of the NRPC and receiving information directly from them. But since my interest is in both Canada and the USA I will try to provide updates for both areas.

I hope this new year will bring some closure to the situation and that it will be better than our expectations.

Nortel US moves to seize $37.9m in deferred compensation

2010-12-31T14:32:00.002-05:00

The following story was published on Dec 23rd on the Dow Jones Bankruptcy Review.

As explained to me the program referred to was available to most everybody in the U.S. at JCI 6 (director-level) or higher. Some JCI 5’s were eligible too. The vast majority of participants in this plan were at the director and VP level, not the CxOs or LOB presidents.

Nortel moves to seize $37.9m in executive retirement savings

By Peg Brickley, Dow Jones Daily Bankruptcy Review

Thursday 23 December 2010

Canadian firm says money is part of a 'risky' deferred-compensation plan.

Nortel Networks Corp. moved Wednesday to seize $37.9 million in retirement savings socked away over 10 years by some of its U.S. managers and executives.

The Canadian telecommunications-equipment maker says the money is in a deferred-compensation plan that participants understood was a "risky undertaking," because terms allow Nortel to take the retirement savings if it ran into trouble.

The filing with the U.S. Bankruptcy Court in Wilmington, Del., is couched as a stipulation with the bank that holds the deferred pay and bonuses in a trust account. Once a judge signs off on the settlement, Nortel's papers say, the money executives put away in the trust becomes company property. Nortel named no names in Wednesday's court filing but said the money was put away by "a select group of management and highly compensated employees" in the U.S.

According to the company, the deferred-compensation plan it created in 2000 is a "rabbi trust," which falls outside the protection of U.S. pension laws. Executives were offered an opportunity to delay taking up to 80% of their base salary, and up to 95% of commissions and bonuses, by putting the money in the trust.

The expectation was that they would draw on their earnings after retirement, when tax rates were lower. Nortel says the deal included an understanding that in the event of bankruptcy, the participating executives would get in line with other unsecured creditors to await payment under a Chapter 11 plan.

The fate of deferred-compensation programs in Chapter 11 often depends on how the programs were actually administered. Because they expose earned employee pay to creditors, such programs are supposed to be limited to top executives who presumably have access to professional advice about the risk of participating.

Not all companies might play by the rules, though.

Christmas Break

2010-12-24T17:36:00.002-05:00

I know this Christmas won't be a very happy time for many people, especially the disabled Nortel people facing major issues next year. During this Christmas-time I hope that for a while we can all put aside our worries and concerns, and focus on our families and get that happiness feeling once again for at least a little while.

I will probably not be posting anything for a few days though if I notice something happening I will make sure it gets posted.

So please check back again after Christmas when I will continue to issue information as I find it and will provide my opinion as I see fit.

Merry Christmas to all my readers, and I sincerely hope that the New Year brings us a lot better than these last two.

Tom

(1) EMEA Claims (2) US Restoration Plan termination

2010-12-23T14:20:00.003-05:00

(1) Emea Claims

The Canadian monitor Ernst and Young have submitted their 58th report to the US court outlining a proposal to set a bar date for Feb 11, 2011 for all Nortel EMEA related claims. Most of those claims are inter company and will likely be contentious. They are also a sticking point in terms of settling the division of assets between geographic units of Nortel and it is E&Y's point that these claims need to be identified and resolved before the division of assets can be properly determined.

The report is listed on a docket for Dec 23rd on the Epiq web site.

The process in the report contains a paragraph referencing the claim by the UK Pension Trust, and the UK Pension Protection Fund. This is a little unsettling since that claims was ruled out of line by both the Canadian and US courts last year since it is a UK claim against other country assets. However the UK funds have not given up and are pressing for settlement and have been allowed to participate in the mediation talks on allocating the Nortel assets by geography. Since the claim is huge, ($3B), it could impact us tremendously if allowed to stand.

(2) US Restoration Plan Termination.

After almost 2 full years of not getting paid my non-qualified pension from Nortel US, I received a letter from them, sent through Epiq, basically telling me that the restoration plan has been terminated. The letter also states that any claims related to the restoration plan will be settled through the claim process that was established in 2009. Seems a little late for that information to be arriving. I presume this official termination is a required legal step to meet some ERISA or other employee protection requirement.

Canadian HWT fund distribution

2010-12-20T15:13:00.002-05:00

As posted on the Koskie Minsky site:

December 20, 2010 In part as a result of the application for leave to appeal the Court’s recent HWT decision, there can be no full and final distribution of the funds in Nortel’s Health and Welfare Trust before the end of 2010, as was originally hoped. In order to provide interim financial relief for those individuals who are about to experience a cessation of monthly income benefits, the Disabled Employees’ Representative, the Former Employees’ Representatives and the CAW asked the Monitor to bring a motion for an interim distribution to HWT income beneficiaries who are currently in receipt of income benefits.

The Monitor’s motion for an interim distribution was approved by the Court on December 15, 2010. A lump sum distribution of 10% of the present value of eligible beneficiaries’ total income benefit claim to a maximum of 3 months of benefits will be made to income beneficiaries of Nortel’s Health and Welfare Trust (HWT). The Monitor is of the opinion that this level of interim distribution is prudent, reasonable and will not prejudice other HWT beneficiaries or benefits. It is expected that income beneficiaries will receive the interim cash distribution from funds held in the HWT on or around January 31, 2011. The interim distribution will be treated as an advance on income beneficiaries’ ultimate claim to be paid from the funds held in the HWT. Please contact the Monitor if you have any questions

Communique from NRPC Canada re FSM

2010-12-20T09:28:00.003-05:00

Text of the communique from NRPC Canada regarding the letter from Ontario PM McGuinty to Don Sproule re the FSM option for the pension.

Toronto, Friday, December 17, 2010

In meetings today with the Ontario Ministry of Finance and FSCO, the National Chair of the NRPC, Don Sproule, was provided with a long sought after letter from Minister Duncan concerning the request by the NRPC to proceed with the Financial Sponsorship Model (FSM) as an alternative to conventional wind-up of the Nortel pension plans. The letter is a conclusion to the second review of FSM ordered by the Liberal Government at the end of September 2010.

Key points covered in the letter:
• Acknowledges the arguments made by the NPRC for greater pensioner choice during pension wind-up; i.e., choice beyond the current conventional wind-up-by-annuity.
• Provides a clear statement of government intention that will allow the FSM RFP respondents to proceed to submitting binding proposals. Although we are still many months away from binding FSM proposals, when they are ready, pensioners will have an opportunity to choose between conventional wind-up and the FSM. Full communication of the FSM will be provided when the selection process has been completed to enable pensioners to make an informed decision.
• By mutual agreement between the MoF and the NRPC, the default pensioner option will be conventional wind-up-by-annuity. Pensioners must make a clear choice if they wish to opt out of conventional wind-up and pursue the FSM concept.

It has always been advocated by the NPRC that for eligible Ontario service, the benefits of the PBGF (Pension Benefit Guarantee Fund) must apply to either option; of conventional wind-up or the FSM. We received corroboration of this today. This is extremely good news for those with Ontario service and we further thank the Minister for this confirmation.

The actions of the NPRC Québec executive have been instrumental in advancing options for Nortel Québec pensioners, most recently with the Nortel specific provisions in Québec Bill 129 put forward by Minister Julie Boulet. At the same time, Ray Hounsell, Québec chair, has been at the table during all the Ontario Government discussions over FSM. With this announcement by the Ontario Government, the Québec executive will be moving forward to see how the elements of the FSM can further improve the lot of Québec pensioners.

In the case of most of the remaining provinces, the NRPC has had early indications that provincial administrations would be willing to consider other wind-up options if Ontario takes the lead. This is now clearly the case and as the details of FSM are fleshed out, we will be taking the proposal to those provincial jurisdictions so that pensioners with service in those jurisdictions will also be given a choice.

We have much work to do, but it’s time to pause here and without going into names thank the many people that got us to this stage: our advisory team from Koskie Minsky, The Segal Co and RSM Richter, the NRPC national executive, the NRPC Québec executive, and all members who attended the rallies at Queen’s Park, signed petitions and wrote to or visited their MPPs and Government Ministers. Special mention goes to the “NRPC 16” who got us a second review of the FSM concept with Premier McGuinty.

Finally, the political process worked and we expressly thank four Ontario MPPs: Charles Sousa, Yasir Naqvi, Bob Chiarelli and Norm Stirling who have worked in support of finding better options for Nortel pensioners.

http://www.ottawacitizen.com/life/Nortel+pensioners+right+invest+with+private+fund+managers/3997385/story.html

FSM management

2010-12-18T17:43:00.002-05:00

In my opinion, if the option to create and apply an FSM for the Nortel Canada pension fund becomes a reality, there need to be some up-front rules and decisions made and ratified by the pensioner and future pensioner population.

The following options should be made available to each pensioner depending on their place of residency and eligibility.

1. Option to use the standard annuity Ontario process.
2. Option to use the Quebec proposal.
3. Option to join the FSM approach.

The NRPC must be completely separate from the administration of the FSM, and the choice of FSM manager should be ratified by a proper vote of those selecting that option. Once a decision is made, the contact with pensioners and future pensioners who select the FSM option regarding their personal situation should be directly from the FSM manager.

Prior to choosing an FSM:

-The pensioner and future pensioner population should be made aware of the element of risk involved with the FSM, and provided clear examples of what to expect in terms of the options they are eligible for.

-It should be made clear if it is to be an either/or decision between choosing the FSM option or choosing an annuity. If it is not possible to convert to an annuity at a later date that must be declared up front. If it is possible to convert at a later date, the mechanism for calculating residual commuted value should be also made clear.

Investment goals should be set for the FSM to ensure the survival of the fund to meet it's actuarially determined obligations and performance against those goals measured routinely.

The FSM performance should be monitored by the NRPC or another body and reported on monthly to all participants. Audits should also be carried out by third parties and reported on annually.

I'm sure there are lots more that needs to be worked out, however I want to emphasize the importance of transparency in this decision and the absolute need to involve all possible pension members to ensure that there are no major legal and financial problems following a decision. We don't want to reduce the pension trust fund any further with unnecessary actions, or poor investment policy.

FSM for Canadian pensions a real possibility?

2010-12-17T20:37:00.003-05:00

The following story was posted in the Ottawa Citizen today. I couldn't see any report of it on the NRPC site. If this is true it looks like the FSM may become a reality for Nortel's pension fund which means that the standard wind up using annuities will not be followed.

I'm not sure what the next moves will be. Morneau Sobeco and the FSCO will surely be involved as well as the Regie de Quebec since this approach may prove bettet than what is offered by law 129.

It will take some time to sort it out.

Ontario gives Nortel pensioners more control over their pensions
By Lee Greenberg, Ottawa December 17, 2010 7:35 PM TORONTO -

Roughly 18,000 Nortel pensioners will now be allowed to invest their pensions with private fund managers, after the Ontario government announced Friday that it will reverse an earlier decision forcing them into a safer - but less profitable - regime.

In a letter Friday afternoon, Finance Minister Dwight Duncan told leaders of the pensioners' group they "have made strong arguments for allowing greater pension choice."

Duncan said the Liberal government will table legislation allowing that choice while "safeguarding benefit security."

"The ability to opt out of the current wind-up approach would allow pensioners who have a greater risk tolerance to elect to pursue investment strategies that may ultimately lead to higher benefits," Duncan wrote in the letter to Don Sproule, national chair of the Nortel Retirees and Former Employees Protection Canada (NRPC). "But it would also ensure that no pensioners have their benefits put at increased risk without making a clear choice."

Pensioners complained they faced an immediate 10-per-cent loss if the government-led wind-up of their $2.5-billion plan went ahead as planned.

© Copyright (c) The Ottawa Citizen

Read more: http://www.ottawacitizen.com/life/Ontario+gives+Nortel+pensioners+more+control+over+their+pensions/3995604/story.html#ixzz18QICpVbP

Poll on distribution of Canadian HWT fund

2010-12-17T11:27:00.003-05:00

The Nortel Canada HWT fund covers a wide range of items including paying for the disabled benefits as well as insurance, medical,dental, etc for pensioners.

There has been quite a debate as to how the remaining funds should be distributed. The courts are saying that it should be allocated based on the percentages promised to both disabled and pensioners.

The disabled people have requested that all the fund should be applied to their benefits since the account is vastly under-funded and they need some income in order to survive. Most of the disabled people are not of pensionable age so these payments are the only ones they receive other than any government support which as you know is minimal.

If the entire HWT fund was split between the disabled people they would get about the same percentage of their current payments that pensioners are going to get when the pension trust fund is properly analysed by Morneau Sobeco.

Handing the contents of the HWT fund over to the disabled would not impact in any way the pension trust fund for retirees.

A poll has been established on the Yahoo Groups site for Nortel pensioners. You can go on there if you are a member and vote whether to award the HWT funds to the disabled or not. This is just a poll and has no immediate legal consequence.

Here is the message on Yahoo Groups:

I support that the disabled and survivors get the whole of the Health and
Welfare Trust. By agreeing to this I understand that I may be giving up a single
$3500 lump sum payment from the proceeds of the Health and Welfare Trust that
currently goes to pensioners. I also understand that this will allow the
disabled to get about the same percentage from the Nortel estate as the
pensioners. I understand that the Health and Welfare Trust proceeds in no way
impacts my pension coming from Morneau-Sobeco.
>
> o I agree that the disabled and the survivors should get the whole of the
Health and Welfare Trust
> o I do not agree that the disabled and survivors should get the whole of the
Health and Welfare Trust.
> o I have no opinion either way.
>>
> To vote, please visit the following web page:
> http://groups.yahoo.com/group/Nortel_Pension/surveys?id=13054542

Canadian MPs not supporting Bill C-501

2010-12-16T10:27:00.003-05:00

The bill C-501 that will give Canadian pensioners better priority in terms of bankrupt estates is in discussion in the Industry committee. It looks like the conservatives are opposing it and the possibility of retroactivity is probably off the table, so Nortel retirees won't be helped by it.

However it still is a good thing for Canadian retirees and the law should be passed. That will bring Canada closer to the standard in place in the USA, the UK, Germany and many other countries.

To help spur on the negative MPs on the committee I sent the following email to them to remind them of the government's role in this Nortel debacle.

The recipients listed are the ones opposing on the committee so feel free to write to them and give them your opinion.

--------------------------------------------------------------------------------
To: wallace.m@parl.gc.ca, vankesteren.d@parl.gc.ca, lake.m@parl.gc.ca, garneau.m@parl.gc.ca, Braid.P@parl.gc.ca, Sweet.D@parl.gc.ca, mcteague.d@parl.gc.ca

Sent: 12/15/2010 8:22:49 P.M. Eastern Standard Time
Subj: Canada's lack of support to Nortel disabled and pensioners

Dear Sir or Madam,

I am a retiree from Nortel Canada who is extremely dissatisfied with the treatment that the Nortel disabled people and the Nortel pensioners have received from the Canadian government.

You can check out the video I placed on Youtube at http://www.youtube.com/watch?v=e4ZyRYuSAZg to express my views.

Canada's government had an opportunity to step in when Nortel was in trouble and help protect a national asset. Instead you chose to provide money to G. M. but turned your back on your own home grown internationally recognized mega-corporation.

As a result Nortel went under. Major assets that have brought Canada revenue and recognition for over 120 years, are now in the possession of foreign companies who have benefited from those many years of Nortel innovation and Canadian support.

Thousands of Canadians are now unemployed, or working for foreign corporations and using their skills to enhance foreign business.

However, all of that is water under the bridge, but there still remains the tragedies of the Nortel disabled and the Nortel pensioners that you have created by letting this happen.

Nortel disabled will lose all their support Jan 1, 2011 and face an unknown future where many will be impoverished and their lives placed in jeopardy. Nortel pensioners also face the future with trepidation as they wait for the cut in their pension income that may exceed 40%.

How can this have happened in Canada?

The Canadian laws regarding pensioners facing company bankruptcy are non-existent. Unlike enlightened countries who provide pension protection, Canada still blunders on letting their retirees take the full brunt of company bankruptcies.

The Canadian laws for disabled trust funds are also virtually non-existent. How is it possible that Nortel could fool the disabled people into thinking that they were insured until they reached pensionable age only to find out that there is nothing in their fund?

Shame on Canada for being so apathetic to these weak and vulnerable people. Examine your conscience and take action to support these people. You can start by approving Bill C-501 and making sure it applies to Nortel pensioners.

Nortel Estate Mediation talks

2010-12-15T14:29:00.002-05:00

I was pleasantly surprised to have a phone call from Koskie Minsky today.

I had emailed them last month to enquire about the mediation talks and to make sure that Canadian pensioners and ex-employees were well represented at the talks. My concern was that the discussions would be dominated by large claims such as the UK pension claim and that the Canadian and US claimants would be negatively impacted.

The Koskie Minsky representative assured me that they, as our lawyers in Canada, were participating at the talks on our behalf along with other representatives from Canada.

Unfortunately there have been no decisions made and the talks have not yet yielded any result.

The Koskie Minsky representative told me that the NRPC are up to date on all discussions underway and that they will be providing updates when there is something to talk about.

The longer it takes to reach a decision, the more the lawyers can charge against the Nortel Administration fund, and that means a reduction in the total estate which will be distributed to claimants. So let's hope it doesn't take too long.

Quebec Law 129 application to ex- Quebecers

2010-12-14T14:41:00.002-05:00

Quebec law 129 provides some help to Nortel pensioners who retire in Quebec. Many people have worked in Quebec and then moved to another province or country and are asking "does law 129 apply to me".

If you last worked for Nortel Canada in Quebec and transferred to another country, like the USA, then law 129 probably applies to you since you are considered to have retired from Quebec.

If you worked in Quebec and then transferred to another Canadian province and retired from that other province or moved to another country from that province, then law 129 probably does not apply to you.

None of this is totally clear and Morneau Sobeco have their work cut out to determine where everyone worked during their Nortel careers, and which pension funds need to be transferred to the Regie de Quebec under law 129.

Morneau Sobeco will also be determining those of us who are eligible for the FSCO top up in Ontario, and in this case it will depend on how many years you worked in Ontario, and what that contribution to your over Nortel Canadian pension is.

Youtube video urging action in Canada

2010-12-13T21:28:00.002-05:00

There hasn't been any good news from the Canadian government to help the Nortel disabled people who will lose their benefits Jan 1 2011. In spite of all the demonstrations, meeting, letters, court cases, and newspaper articles, the Nortel disabled face disaster in less than 3 weeks.

The pensioners wait their turn as the new year arrives and they find out how badly their trust fund is under water.

Where's all the Canadian sympathy? Where's all the usual heartwarming assistance that we expect when we think of Canadians? Does no one care what is going to happen, especially to these disabled people who have no where else to turn?

I just got so mad at this that I made a short video and uploaded it to Youtube to express my feelings and to heap shame and embarrassment on Canada and especially the Canadian government.

Please pass it on, and send it to all those MPs and Senators who are sitting around examining their navels instead of helping these people who are in desperate straits.

http://www.youtube.com/watch?v=e4ZyRYuSAZg

UK court ruling gives Pension Trust Fund first priority in Bankruptcy

2010-12-11T18:51:00.003-05:00

A ruling by the high court in the UK has granted top priority to pension Trust Funds of bankrupt companies. The ruling allows Trust Funds to stake their claim as administrative and thereby ensure payment into the trust fund from the bankrupt estate in front of other creditors.

In the UK there is a pension Protection Fund which is similar to the PBGC in the US in that it takes over and pays pensions to the retirees if the company enters bankruptcy. So it looks like the PPF will be able to claim first priority from now on if this ruling sticks.

Canada has no such protection, nor is there any priority for pension trust funds. We Nortel retirees are seen as unsecured creditors and the $1B deficit in our Canadian pension plan will be treated after all the fat cat secured creditors get their
payment out of the estate. Bill C-501 was intended to raise our priority, but it is bogging down in committee and the government MPs are claiming that there is no way they will make it retroactive if it passes.

Here's the write up in the Telegraph on the UK ruling

By Philip Aldrick and Helia Ebrahimi 8:10AM GMT 11 Dec 2010 97

In a fundamental shake-up of the corporate debt structure, pension trustees will be able to demand a lump-sum payment from administrators of a failed business ahead of all lenders bar those backed by property assets. Even the administrators will be lower in the pecking order.

Before the ruling, pension claims ranked beneath the riskiest unsecured loans, potentially robbing workers of their retirement income.

In a packed courtroom at the High Court on Friday, Mr Justice Briggs ruled in favour of The Pensions Regulator in its bid to recover funds from Lehman Brothers and Canadian telecoms firm Nortel for the 43,000 members of the insolvent companies' pension schemes.

The administrators of Nortel and Lehman, which went bust with UK pension deficits of £2.1bn and £148m respectively, were contesting the regulator's decision to issue a "Financial Support Direction" (FSD) requiring them to strike an agreement with the pension trustees before disbursing funds to creditors.

Under the current rules, if no agreement is struck the regulator imposes a "Contribution Notice" (CN) demanding the administrator make a payment to the trustees. In a ground-breaking judgment, Mr Justice Briggs ruled that the CN would qualify as an "administration expense" – meaning it must be paid above all but "fixed asset" creditors, even before the administrators take their fees.

"It's a shock ruling, everybody I have spoken to has got their mouths wide open," said Nick Moser at law firm Taylor Wessing. "Administrators will be discouraged from implementing rescues because super-priority for pension schemes could wipe out any return for any other creditor."

Allen & Overy restructuring partner Jen Marshall added: "This will have huge implications for the restructuring industry. It is potentially catastrophic, the decision is totally untenable. For banks and companies, it is an impediment to the rescue culture."

Jonathan Land, business recovery partner at PricewaterhouseCoopers, who advised Nortel's pension fund trustees throughout the two-year case, warned that companies with large pensions deficits, such as British Airways, may find it harder to raise funds as a result.

"This is great for pensioners but will have huge implications for the banks," he said. "Banks will have to wake up to the importance of the pension creditor. They will have a lot more risk to contend with. They should be wary of companies with huge pension liabilities."

Mr Justice Briggs said he regretted having to make the ruling, which he blamed on "a legislative mess". "Parliament might wish to consider a suitable amendment," he added.

"The conferring of super-priority as expenses on the financial liabilities arising from the FSD regime is both potentially unfair to the target's creditors and inconsistent with a decision taken in 2004 not to elevate employees' pensions claims above the claims of those creditors."

The regulator, whose role is to protect both pension scheme members and the lifeboat – the Pension Protection Fund – welcomed the ruling.

The administrators are expected to appeal.

http://www.telegraph.co.uk/finance/personalfinance/pensions/8195407/Pension-ruling-catastrophic-for-companies.html

Quebec Law 129 -Supplementary Pension Act

2010-12-10T21:26:00.004-05:00

Quebec has passed a new law 129 that modifies Quebec Law 1 Supplementary Pension Act so that Nortel Quebec retirees can take advantage of the law. In addition the time period that Quebec is willing to administer the pension has been increased from 5 to 10 years.

This only applies to pensioners who retired from a Quebec location. Quebec Law 1 offers 3 different options. (1) An annuity. (2)Transfer to a Life Income Fund, (3) Pension fund managed by Quebec for up to 10 years ad then purchase of an annuity. The amount paid in option (3) would be no less than what would be obtained in option (1) but could provide for future gains if the annuity market improves.

Canadian Manulife, Sunlife,LTD Update

2010-12-10T21:16:00.002-05:00

The following information was posted on the Koskie Minsky website yesterday and today. Please check the Koskie Minsky site (Right hand column) for links to other information

December 10, 2010 All Manulife packages were mailed on or before December 1, 2010. If you have not received a package yet, please contact Manulife directly at 1-800-370-7057 to request that they send you a package. This number is now active and was established specifically for former Nortel employees who wish to contact Manulife to get additional information or to apply for coverage. The number can be used to call Manulife from anywhere in Canada and the continental US.

December 9, 2010

1. Upcoming Changes to Existing Sun Life Health, Dental and Life Insurance Coverage:
Many Nortel retirees, former employees and disabled employees currently receive health, dental and life insurance coverage through Sun Life. It is important to note that your current coverage with Sun Life ends effective December 31, 2010. All claims under the current coverage must be incurred by December 31, 2010 and must be submitted to Sun Life prior to February 28, 2011. Please be sure to submit all claims to Sun Life by the February 28, 2011 deadline, as no claims will be accepted for processing after that date.

2. December 2 Mailing – Alternative Manulife Health, Dental and Life Insurance Coverage:
The NRPC, in conjunction with the CAW and Nortel’s disabled employees, has worked with advisors to establish alternative health, dental and life insurance coverage that will be available after your current coverage ends. It is voluntary and you must pay for it. After an analysis of the various options and costs, the NRPC has endorsed the coverage that Manulife Financial has offered to make available to all former Nortel employees without evidence of insurability as of January 1, 2011. Packages outlining the details of the Manulife Financial coverage and enrolment information were mailed to all retirees, former employees and disabled employees of Nortel during the week of December 2. To discuss any questions you may have about the Manulife coverage, please contact Manulife directly after December 13 on the toll-free line that has been established for Nortel former employees. Please note that the toll-free hotline, 1.800.370.7057, is not operational until December 13, 2010.

The Manulife coverage is an optional program and if you choose to participate, you will be required to cover the premiums and other associated costs. If you decide to purchase coverage from Manulife, all of your transactions will be directly with Manulife. To determine whether the Manulife coverage is the best option for you, you may wish to discuss your needs and preferences with family members or other individuals that you trust. You may also wish to investigate other options such as provincial drug programs for which you may be eligible. The NRPC has prepared a newsletter outlining some of the provincial drug programs that may be applicable to you. To view a copy of that document, go to the NRPC Website.

3. LTD Updates:

In accordance with the Settlement Agreement, Nortel’s disabled employees will be terminated from employment with Nortel, effective December 31, 2010. There will be a number of important upcoming changes. These changes are outlined in a Termination Package that was recently mailed to Nortel’s disabled employees.

In addition to outlining the upcoming changes to your health, dental and life insurance coverage, the Termination Package also outlines issues pertaining to Nortel’s defined contribution and defined benefit pension plans. Please be sure to review your Termination Package. You may contact the Monitor or your Representative Counsel with questions or concerns.

If you are a member of one of Nortel’s pension plans and have questions that are specific to your pension, please contact Morneau Sobeau:

Managerial Plan - 1-877-392-2074

Non-Negotiated Plan – 1-877-392-2073

Email – nortelwindup@morneausobeco.com

Disabled employees who are members of Nortel’s pension plans under the defined benefit (“DB”) provisions received a letter from Nortel in mid-September, which outlined changes to your pension contributions. The letter informed eligible individuals about a one-time “top-up” deposit that will be made to compensate you for the value of the DB benefit that you would have accrued under the DB plan during the October 1 – December 31 period but couldn’t because the Plan will be wound up effective September 30, 2010. We expect the one-time “top-up” deposit to take place in late December 2010. For eligible Canadian residents, the deposit will be made directly into your existing investment account with Sun Life. For eligible individuals who reside outside of Canada, the one-time deposit will be made into your after-tax savings vehicle (ATSV) account.

Canadian parliament comments on pensioners and LTD

2010-12-08T16:35:00.003-05:00

The following is taken from the Hansard record of the debate in the Canadian House of Commons. It is clear that the conservative government are not willing to budge on providing relief to Nortel pensioners or LTD personnel. Twice a reference is made to the effect that retroactivity on these bill is not possible. This is your government at work...

Pensions
Hon. Ralph Goodale (Wascana, Lib.):
Mr. Speaker, yesterday, the unelected, unaccountable, Conservative-dominated Senate killed the long-term disability pensions, and again the government laughs, of more than 400 Nortel employees. These people are suffering from Parkinson's Disease and similar disabilities. Without their pensions, they will be destitute just 28 days from today.
At a time when Conservatives have a lot of money for jets and jails, corporate tax giveaways and bloated ministerial offices, why can the government not help 408 innocent, hard-working but now disabled Canadians?

Hon. John Baird (Leader of the Government in the House of Commons and Minister of the Environment, CPC):
Mr. Speaker, if the Liberal Party would like to reform the Senate, I would encourage it to get behind this government's agenda.
We have legislation before Parliament with respect to elections of senators and with respect to the term limits going from 45 years to 8 years. We think that is incredibly important.
However, the issue involving Nortel pensioners and LTD recipients is obviously a very serious one. Regrettably, the reality is we cannot legally and constitutionally make laws that apply retroactively. I think the member opposite knows that.

Hon. Ralph Goodale (Wascana, Lib.):
Mr. Speaker, the minister is plainly wrong.
Since coming to office, the Conservatives have wasted a billion dollars in extra spending on partisan advertising, outside consultants and other excesses. The Prime Minister's personal political expenses are up by more than 30% in just the last two years. The political spending of the Minister of Justice is up by nearly 20%. The Minister of Transport, is up 100%. The chief government whip is up 235%. Yet disgraceful Conservative senators are hacking the pensions of the long-term disabled.

How can the Conservatives look themselves in the mirror?

Hon. John Baird (Leader of the Government in the House of Commons and Minister of the Environment, CPC):
Mr. Speaker, let us be very clear. If we want to look at the basket of political expenses by this government, let us look at the expenses in the offices of the ministers. The use of government aircraft, particularly the use of Challenger aircraft, travel and other associated expenses, hospitality and polling expenses are dramatically reduced under this government. The member opposite, I suspect, knows that.
We are following the issue incredibly closely with respect to the situation involving Nortel LTD recipients. The reality is we cannot make laws retroactive. If the member opposite believed in this, he had 13 years to change the Bankruptcy Act and failed to do so.

Hon. Ralph Goodale (Wascana, Lib.):
Mr. Speaker, it is not just the disabled at Nortel. Two-thirds of Canadians do not have decent retirement savings at all. Under the current government, poverty for senior citizens has jumped 25%. Family household debt has skyrocketed. It is 50% higher than disposable incomes. The well-being of children is dropping.
Why does the government lavish $6 million in personal benefits on one Conservative senator, Senator Brazeau and his used Porsche, when it has nothing for pensions, family caregivers or better access to education?

Hon. John Baird (Leader of the Government in the House of Commons and Minister of the Environment, CPC):
Mr. Speaker, the Liberal Party has made great noises about wanting to raise the decorum in the House and talk about issues that are relevant to Canadians.
For the member for Wascana, talking about what kind of automobile a parliamentarian drives is not really—

Seniors
Mr. Pablo Rodriguez (Honoré-Mercier, Lib.):
Mr. Speaker, what the Conservatives are doing is disgusting. They are shamelessly wasting our money. Meanwhile, the poverty rate among seniors has increased by 25%. Has that become a priority for them? No, not at all. Worse still, they are changing the rules to make it even harder to access the guaranteed income supplement. This will force even more seniors into poverty.
I know they are very busy gallivanting around in taxis, eating canapés, building prisons and buying airplanes, but when they have finished all of that, will they finally find some time to look after our seniors?

Mr. Ed Komarnicki (Parliamentary Secretary to the Minister of Human Resources and Skills Development and to the Minister of Labour, CPC):
Mr. Speaker, we are certainly concerned with seniors and we have therefore taken a number of actions to be sure they have extra income in their pockets.
We have taken action specifically with respect to the guaranteed income supplement to be sure that they are entitled to receive that. We have increased the guaranteed income supplement twice.
We would ask the member and the Liberal Party to get behind us when we are taking initiatives that are helping our seniors in this difficult time.

Pensions
Mr. John Rafferty (Thunder Bay—Rainy River, NDP):
Mr. Speaker, Canadians are worried about the high cost of living and their retirement income. In northern Ontario the price of gas went up 10¢ last night. Home heating costs are skyrocketing, thanks to the government's HST scheme.
A poll of Canadian CEOs on my pension protection bill, Bill C-501, found that a majority believe the bill is fair and that Parliament should pass the bill.
Will the government respect the wishes of Canadian CEOs and pensioners and support Bill C-501 and protect six million Canadians?

Mr. Ted Menzies (Parliamentary Secretary to the Minister of Finance, CPC):
Mr. Speaker, we are protecting 34 million Canadians by reducing their taxes. That is what Canadians have asked us to do and we have delivered on that through our economic action plan.
We have created over 441,000 net new jobs since July 2009. That is what Canadians wanted. They wanted assurances that their government was listening to what they wanted. They wanted to ensure they had jobs so they could help support their families. That is what is important.

* * *

Canadian bill C-501 and Manley Lobbying against it.

2010-12-07T16:19:00.002-05:00

The NRPC site for members only has published details on the statements by John Manley regarding what he calls myths put out by pensioners about Canada's protection for retirees if affected by bankruptcy, and the impact on Canada of providing priority to pensioners to ensure that the trust fund is made solvent before other creditors are paid.

If you are an NRPC member, you can access it in the members only section of the NRPC web site. (Link in the right hand column)

Manley identifies five myths,(as he calls them). The NRPC has provided specific and detailed rebuttals to each of the myths. If you plan to write letters on this to your MP, consult the NRPC site for details.

Essentially Manley is siding with the bond holders and big business interests to block bill C-501, and his opinion is certainly biased.

In the first area Manley claims that very few industrialized nations provide this kind of super priority. We all know that Canada is way behind the US, the UK, Germany, and other civilized nations where pensioners are treated with respect and honor, as opposed to Canada where we as Nortel pensioners and disabled people have been cast aside and our plight ignored.

Manley also claims that Canada has already taken steps to protect defined benefit plans and that Canada leads in this area. As a typical politician, his references do not directly address the issues of trust fund insolvency and his remarks only apply to a very small percentage of Canadian retirees.

Manley raises the old big business fear monger, that a bill such as C-501 would drive more companies into bankruptcy. What he fails to think about is a new culture that bill C-501 would create whereby all stakeholders would take part in ensuring pension trust funds are correctly funded, audited regularly at shorter intervals,with properly calculated contributions made, rather than the sloppy approach currently in place.

Building on the previous idea, Manley also has claimed that Bill C-501 would negatively impact bondholders and make credit harder to obtain for a company. Detailed financial analyses carried out by a consultant to the NRPC and reported on at previous webinars, and to the government, has clearly identified that the impact would be negligible. In the US for example, the PBGC has had priority status over other investors for many years, and that hasn't had a major effect.

The final area that Manley attacks is the continuance of defined benefit plans. He claims that Bill C-501 would raise the cost of defined benefit plans. I find that hard to believe. If a company is funding the plan properly there shouldn't be any negative impact.

The issue is the Canadian law which allows companies to under contribute and let the plan fall behind for too long a period. In Nortel's case for example, the last real plan evaluation was in 2006 and at that time it was underfunded. The extra payments required by law to make up that deficit were far too low as the economy tanked and the fund lost money, and there was no emergency review and reassessment until after Nortel had declared CCAA and chapter 11. The law is at fault. The government created this situation with their poor oversight legislation. Now when it comes to correcting that for the unfortunates who will suffer because of these incompetents, they, and people like Manley, won't step up and do the right thing.

Canadian Pension Indexing dis-continued

2010-12-06T17:39:00.002-05:00

I received a letter from Morneau Sobeco today that indicated starting January 1st 2011 indexing for cost of living on retirees birthdays will be discontinued. This action is intended to reduce payments out of the pension fund that could make the deficit even larger.

There is no information yet of the official calculated percentage of the fund solvency ratio.

Morneau Sobeco indicated in the letter that if indexing was part of your pension agreement that would be taken into account when they are making the decisions on pension reductions. What that will mean to the pension going forward is not clear.

Canadian Bill C-501, Industry Committee Meeting

2010-12-05T21:39:00.003-05:00

The minutes of the Canadian Parliamentary Committee on Industry for Dec 2nd are centered on their discussion of Bill C-501 which is intended to provide super-priority for unfunded pension amounts in bankruptcy situations.

Based on what I read, this bill will not provide Nortel pensioners with any help to bridge the pension funding shortfall since there is no retroactivity clause and that is clearly understood by the committee members.

You can read the minutes at the following extremely long link"

http://www2.parl.gc.ca/housechamberbusiness/ChamberPublicationIndexSearch.aspx?arpist=s&arpit=bankruptcy+%22Pension+guarantees%22&arpidf=2010%2f03%2f03&arpidt=&arpid=False&arpij=False&arpice=True&arpicl=15385&ps=Parl40Ses3&arpisb=Publication&arpirpp=10&arpibs=False&Language=E&Mode=1&Parl=40&Ses=3&arpicpd=4813618#Para2202394

The committee spent most on their time debating amendments to the 7 clauses of the bill which were intended to make the intent of the bill clear. The amendments would mean that the bill gave super-priority to all unfunded amounts that would be required to bring pension funds up to a solvency level to provide full pension rights to retirees.

The committe decided that they needed to have further input from the witnesses who had attended previous sessons to obtain their input on the amendments. The motion approved by the committee was described by Mr. Robert Bouchard:

We are talking about two meetings to hear witnesses and a third for clause-by-clause consideration. I am pretty sure that not all of the witnesses we heard from previously will return. I think we could probably combine the ones that we've already heard from with some new ones, as proposed by my colleague. In any case, we can limit ourselves to two meetings to hear witnesses and a third for clause-by-clause. I think it would be appropriate to set a limit. That way we would be required to have results by the time the third session came around—in other words, for clause-by-clause. I believe there is a consensus on that. Conservative members seem to agree. I think I also heard Mr. Rafferty say that he is open to that idea. That is also our position.

The committee also decided to ask for a 30 day extension.

As part of the discussion it was made very clear that this bill would not provide any relief to Nortel Pensioners since there is no retroactivity in it. The committee members referenced the efforts made by Nortel Pensioners to have the bill enacted and lauded their self sacrificng attitude to help future pensioners in a similar situation.

Canadian Bill C-501 last week end before vote.

2010-12-04T16:50:00.003-05:00

As published on the NRPC web site, by one of the NRPC leaders.

Friday, 03 December 2010

Thursday, 2 Dec, was the last day of C-501 hearings before the INDU committee gets back together for clause by clause discussion and voting on Dec. 7.

This is the tale of two pressures. One from corporations including bank executives lead by John Manley and supported by the government; and the other pressure mainly coming from former Nortel employees with support from unions and pensioner organizations.

Many spoke on all sides that former Nortel employees were caught in a worst possible economic condition i.e., the perfect storm which is not likely to repeat for a long long time. Many in expensive suits said "It is unfortunate" (to their shame), as opposed to something should be done to relieve their condition. Bruce Robertson, Chief Restructuring Officer of AbitibiBowater Inc. said that lenders when they lend, protect themselves from the worse condition the company may be subjected to. So it is OK for lenders to protect themselves from the worse market condition but it is not OK for pensioners to protect themselves from the market's worst condition. This is where the imbalance lies. It is too bad that fairness, that all too human quality evaporates with greed. Our only hope, as I see it, is a special arrangement of accommodation.

My reading is, and I emphasize my reading, that the conservatives will use the same tactic they used to kill the S-216 in the Senate by bringing a motion to drop it and not go clause by clause on Dec. 7. But here they need the support of the Liberals to succeed. That is why in my opinion Mike Lake (conservative) said further amendments would be accepted up till and including Monday Dec. 8. Will the Liberals try to work something out with the conservatives or the NDP? That is the big question.

This is why we should continue sending emails to committee members emphasizing the unique circumstances Nortel retirees have been subjected to during this unprecedented global market collapse. Why should we be sacrificed at the altar of the Canadian Market to restore the Canadian economy? You have Friday, the weekend and Monday only to impress them. That is it for now, and we will wait the outcome at the very important Dec. 7 C-501 meeting. Based on that outcome we shall move to our next phase. See some emails by other warriors below.

Pressure must still be put on BCE and RB - both companies made representations at the hearings to let the former employees suffer. I suppose their lobbyists (Former Liberal minster Don Boudria hired by BCE and often quoted by the conservatives former Liberal minster of everything, John Manley) have to give the OK for any plan of special arrangement of accommodation for former affected employees of Nortel. Note that BCE has not replied, is it arrogance or smart politics?

Wait till you see “ The Royal Bank and Bell Canada supported by the Conservative Government broke my life!”

Canadian contact list from NRPC-Montreal

2010-12-02T14:13:00.004-05:00

The following contact list was issued by the Montreal Chapter of the NRPC.

Thursday, 02 December 2010
Important contact information for Nortel Pensioners to obtain accurate replies to their questions

NRPC /SRNC Quebec Region Contact List

Agencies / Companies

CARP

CDN Association of Retired People 1-800-363-9736
www.carp.ca

CAW/TCA Union

Barry Wadsworth 416-495-3776
www.caw.ca/en/5511.htm

e/mail Michelle.bondy@caw.ca
This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

Ernst & Young 1-866-942-7177

FADOQ Federation Age D'Or du Quebec
www.fadoq.ca

KM Law 1-866-777-6344

www.kosyirminsky.com/case-central

e/mail Nortel@kmlaw.ca
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Sun-Life Insurance 1-800-361-2128
www.sunlife.com

Long Term Disabled
steeringcommittee@cneltd.info
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Manu-Life
TBD
www.manulife.com

Morneau-Sobeco
Negotiated Pension 1-877-392-2073

Non-Negotiated Pension 1-877-392-2074

www.morneausobeco.ca

www.pensionwindups.morneausobeco.com

e/mail nortelwindup@morneausobeco.com
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NRPC COP Ile Bizard
PO Box 89017
Ile Bizard , H9C 2Z3

www.nortelpensioners.ca

e/mail nrpc.montreal@gmail.com
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nrpc.qcmed@gmail.com
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NT Pension services
Disconnected Oc1 1st 2010

NT Human Resources 1-800-676-4636

RAMQ Montreal 514-864-3411

Quebec 418-646-4636

Others 1-800-561-9749

HDD 1-800-361-3939
www.ramq.gouv.qc.ca/index_en.shtml

RRQ
Montreal 514-873-2433

Other 1-800-561-9749
www.rrq.gouv.qc.ca/en

Prepared & issued by your NRPC Quebec region Committee 1.12.2010

Canadian Bill S-216 Voted Down

2010-11-28T12:56:00.000-05:00

As noted on the NRPC Website

Friday, 26 November 2010

Senator Eggleton's Bill S-216, which would have given preferred status retroactively to the claims of people on long-term disability in the bankruptcy process, was voted down in a Senate committee yesterday, Nov 26th. Senator Ringuette's Bill S-214, which would give the same treatment to pensioners, likely faces the same fate in the next few days.

Federal Minister John Baird is quoted in the press as being against Bill S-216 because the retroactivity clause would have been "unconstitutional". NRPC believes he is wrong on that front since the government has already made similar changes to the Wage Earner Protection Program in 2009 and for Canadian banks with Asset Backed Commercial Paper problems in 2007.

The NRPC believes that all former employee claims deserve preferred status in bankruptcy court - both LTD and pensioners. We will continue to fight for justice in bankruptcy including legislative changes which would protect all existing and former employees of Nortel.

Disabled bill may fail due to rejection by Conservative Canadian senators

2010-11-26T12:19:00.002-05:00

The Canadian PM Harper has stacked the Senate with conservatives who seem only interested in protecting their well heeled cronies. How can they turn down helping 400 disabled people who will lose their benefits next month due to the negligence of Nortel and the indifference of the Canadian government to those who need the most support? Canada is retrogressing into the dark ages under this leadership.

The following story was published yesterday.

Tory senators poised to kill bill for disabled Nortel pensioners
Published On Thu Nov 25 2010
The Canadian Press

OTTAWA—The Conservative-controlled Senate is poised to kill a bill that would have protected former Nortel employees from losing their long-term disability benefits.

Conservative senators have used their majority on the Senate’s banking, trade and commerce committee to recommend that the upper house not proceed with the bill.

The chamber, dominated by Tories thanks to a raft of recent appointments by Prime Minister Stephen Harper, is likely to accept the committee’s report.

The bill, proposed by Liberal Senator Art Eggleton, sought to ensure that 400 disabled Nortel employees would be given preferred status among creditors when the once-mighty telecommunications technology giant is finally dissolved.

Most of the company has been sold off since Nortel filed for bankruptcy protection in January 2009.

Without Eggleton’s bill, long-term disability benefits will cease at the end of this year.

Comments in Ottawa Sun re treatment of Canadian Nortel pensioners

2010-11-25T10:36:00.004-05:00

Comments by Anne Clark-Stewart on an article in the Ottawa Sun regarding the Nortel Canadian Pensioners and the government apathy to our situation.

Well said Anne!

Response to Ottawa Sun Article, Nov 23rd
Wednesday, 24 November 2010
Re: Nov 23/10 Pension deal: caviar for them, crusts for you:

Crusts you say. Nortel pensioners will be lucky to get crumbs from the bankruptcy proceeds of this interminable and most complex bankruptcy in Canadian history. The term “upper crust” was derived from the gentry being given the clean top crusts of bread and the servants being given the base of the loaf that was often overcooked, black and dirty from the ovens.

Large numbers of Nortel retirees, terminated and disabled employees have been working for nearly two years now making presentations to politicians of all parties and all levels of government and NOTHING has been done to address our dire situations. The stress of this uncertainty is creating havoc with our stress levels and our health.

We will be very lucky to get 60% of our pensions (please read deferred wages). Our taxes on these reduced pensions will help pay for the public service pension deficit. The disabled employees’ wage replacement benefit terminates at year-end, even though they paid premiums for what they thought was insurance, and have no support in sight for years as the Nortel assets are still not all sold. Where will the disabled end up? On welfare? On the streets? A burden to society and the Canadian taxpayer? Certainly not eating caviar.

We will all see our health and dental benefits and life insurance eliminated at the end of the year. How can we replace them when our pensions and/or LTD benefits are being cut so drastically?

How will the over 1200 widows with an average pension of $900 per month be able to pay rent or put food on the table? Most never worked outside the home as they raised their families while their spouses devoted many unpaid overtime hours to the development of some of the greatest technological advances in the history of telecommunications. And these are the crumbs they get.

Having spent the past two weeks in Industry Committee hearings on Bill C-501, MP John Rafferty’s private member’s bill to protect pension funds in bankruptcy, I am absolutely appalled at the arrogance of the banks, bondholders and insolvency firms who expound on what “may”, “could” or “possibly” happen to the economy if pension special payments or under-funding were protected under this new Bill. NO facts, NO studies, just suppositions. But then, they are the ‘suits’, the new “Upper Crust”, the caviar eaters. Marie Antoinette’s philosophy is alive and well in the halls of Corporate Canada and the Hill.

Anne Clark-Stewart

A Nortel pensioner

NRPC Newsletter Nov 2010

2010-11-24T17:17:00.003-05:00

The NRPC has published a November newsletter on their website. You have to be a member to view it. I have copied the NRPC president's summary for your information. To see the rest of the newsletter log in to the NRPC website.

NRPC Newsletter – Oct./Nov. 2010
President’s Letter

While not necessarily visible to the members, the NRPC and its advisors have been very active during this past month, keeping true to our goal of maximizing the benefits payable to Nortel retirees and former employees from this insolvency.

Under the terms of the March 2010 Settlement Agreement eligible terminated employees were to receive payments up to $3000. With the expiration of the appeal period these payments have started to flow. The NRPC and our advisors were successful in obtaining tax-sheltered status for those people who had service prior to 1996 and were thus eligible for a retiring allowance as part of their severance payments. Preferential tax treatment for all future benefit payments is on our list for discussion with the Canada Revenue Agency.

I am happy to say that we have negotiated a replacement health plan that we can endorse to the NRPC constituency. Thank-you to NRPC board member François Meunier, the NRPC health committee and John Halls of The Segal Company who helped us navigate the insurance industry ins and outs. Further details follow in this newsletter.

We continue to pursue the Financial Sponsorship Model to allow more options for pensioners rather than a wholesale conversion to annuities by current regulations. Thanks to the action of a few pensioners on a wet September night, Premier McGuinty has agreed to take a second look at the model. The financial community has proposed some very interesting opportunities. That review is now underway. More details follow in this newsletter.

Bankruptcy Act - Bill C-501 has been written to give priority to the pension deficit in a bankruptcy. We have been urging all parties to work together to perfect the wording of this important bill to ensure it is passed into legislation. We have been invited to testify in the committee hearings. Bill S-214 sponsored by Senator Pierrette Ringuette (Liberal) also aims to protect pensioners when their company declares bankruptcy; it is also in committee and will be going into hearings at the end of November or early December. We hope to have an NRPC witness at the Senate Banking hearing on this Bill.

With the October 1st transfer of the registered pension plans to the wind-up administrator, Morneau Sobeco, we moved immediately to establish a constructive working relationship with the administrator. Our first meeting was on October 4th and we have now had four meetings with the goal to better understand the conventional wind-up process and to ensure that the best interests of all pensioners are considered. More on this later in this newsletter.

We have been very busy on multiple fronts and will continue to work on your behalf. I hope that the newsletter is useful to your understanding of current events.

Don Sproule

Canadian LTD statement from Koskie Minsky

2010-11-23T18:52:00.002-05:00

The following was posted on the Koskie Minsky site today.
Read carefully and if you have questions call K.M. You can find their contact information on their website shown in the right hand column.

November 23, 2010

All individuals in receipt of long-term disability payments, survivor income benefits and survivor transition benefits have or will soon receive a statement in the mail which sets out their personal information for verification. This personal information was used to calculate the preliminary estimates in the Beneficiary Estimated Allocation Statement.

The Data Verification Statements for disabled employees contain a column entitled ‘net monthly LTD-income payment’. Please take note that the amount set out in that column is net of Canada Pension Plan (CPP) disability payments, Workplace Safety & Insurance Board (WSIB) payments and other income benefits you receive that offset your monthly LTD-income payment.

However, the amount referred to in that column is not net of tax or other statutory deductions that regularly reduce your monthly LTD-income payments. Please note that for this reason, the amount in the ‘net monthly LTD-income payment’ column will not be precisely the same as the dollar amount of the net monthly payment you actually receive.

You may contact your Representative Counsel or the Monitor with questions or concerns.

--------------------------------------------------------------------------------

Morneau Sobeco

2010-11-23T08:08:00.002-05:00

On Saturday I received a letter from Morneau Sobeco basically telling me that I was in their data base, that they are now administering the Nortel Canada pension trust fund, and that they would be in contact with me when there were changes to be made and also to verify my pension etc.

There was no specific information regarding time frame or possible impact but they did say that before a reduction in pension was carried out I would receive advance notification.

On Monday I received my normal pension pay stub from Northern Trust.

I think that it will take a while before Morneau Sobeco can determine the true pension trust fund ratio. Things may continue as they are now until the first quarter 2011.

Nortel US Medical Plan

2010-11-20T17:07:00.002-05:00

I received paperwork from Nortel today for re-enrollment in the Nortel US Retiree medical plan. It looks like they are offering the same deal but the premiums went up about 13%. That was less than I expected. There is a website to look at the plan details at www.nortel.com/benefits. Click on the "United States", then click on "Choose the right plans" and then on "2011 Retiree Annual Guide".

They also state as usual that they have the right to amend or terminate the plan so lets hope that the plan continues for 2011 and beyond.

Nortel estate mediation representation

2010-11-18T11:26:00.004-05:00

The mediation proceedings are underway to determine how the Nortel Global estate will be subdivided between concerned parties. I have not heard what Canadian representation there is to defend the rights of the Canadian pensioners and LTD, so I have sent the following email to Koskie Minksy (attorneys representing Canadian Pensioners and LTD) to see if I can get further details.

To Koskie Minsky.

I am a Nortel Pensioner living in the U.S.A. I have a claim against the Nortel US estate for unpaid non-qualified pension, and I also will have a claim against the Nortel Canadian estate for the shortfall on my Canadian pension in the trust fund.

The division of the Nortel estate between all countries involved has not been determined in an amicable fashion so far. As a result the decision is now being mediated in proceedings happening in New York State.

There are a number of parties at those proceedings representing various interests. I wish to know if Koskie Minsky is involved in those mediation discussions on behalf of the Nortel Canadian pensioners and LTD.

The US pension trust fund is represented through the PBGC which is part of the unsecured creditors committee and is involved in the discussions.

The UK pension trust fund is represented by the UK Trustee who obtained agreement from the court to participate in the discussions.

I have not seen anything listing the representatives from Canada, and since there is no Canadian federal agency concerned about the survival of pension trust funds after bankruptcy, (unlike the UK and USA), the government is not directly involved, or apparently interested.

As our attorneys, I would like to know what Koskie Minsky is doing to ensure that the Canadian Nortel Pension Trust Fund is properly defended against the demands of the people representing creditors from other countries on the total Nortel estate?

US Medical

2010-11-17T14:27:00.002-05:00

I just learned from a friend who spoke to Nortel shared services that they are in the process of mailing out medical enrollment packages. Let's hope that they do actually follow through with that.

There is no word on what the premium impact might be, though I expect it will be increased based of their desire to get rid of the medical plan at some time.
Also no word on how long the plan is expected to last. Let's hope it's at least for all of 2011.

Pension Protection after Company Bankruptcy

2010-11-14T16:20:00.003-05:00

The following eye opening chart and commentary was posted on the NRPC web site.

Why isn't Canada taking some steps to protect our pensions? We are not asking for anything that isn't already recognized in civilized countries...

Canadian ideas and initiative turned Nortel into a global leader in telecommunications. In opening the global marketplace, Nortel had to establish R&D and sales operations in many countries. Now we find, as Nortel plummets into bankruptcy, that our Nortel colleagues in other countries are well protected by their governments while former Nortel employees in Canada will suffer drastically. Many countries have pension guarantees when a company goes bankrupt that ensure that pensioners can get a fair share of their pension/deferred wages. Other countries ensure that underfunded pension plans get a priority status in bankruptcy claims to protect those pension plans.

Ontario Superior court decision on HWT assets distribution

2010-11-12T15:48:00.004-05:00

The following items were posted on the Koskie Minsky web site.

November 9, 2010 The Ontario Superior Court of Justice released its decision today granting the Monitor’s motion with respect to the proposed methodology for the allocation of the corpus of Nortel’s Health and Welfare Trust. To view a copy of the decision, please link to the Koskie Minsky site (Right hand column) and click on the announcement in the identified spot.

November 10, 2010 To view the most recent Disabled Employees Progress Report that will be mailed out within the next week, please go to the Koskie Minsky website and click on the identified spot.

Nortel asset mediation

2010-11-11T10:09:00.002-05:00

Since no one can agree on how to split the remaining assets of Nortel between countries it has been handed over to a mediator. Representatives at the mediation discussion will include the unsecured creditors committee, and the UK pension trustee. I presume the bondholders group and the Canadian monitor will also participate.

I have not seen anything listed where the rights of the Canadian pensioners will be spefically defended in these discussions. The UK pension trustee will focus on their claim that the global Nortel estate owes the UK pension fund close to $3B dollars. This claim has been rejected by both the US and Canadian bankruptcy courts and has withstood appeals in both countries.

This approach by the UK trustee is another attempt to grab a large chunk of the Nortel assets and thereby deny US and Canadian creditors (including pensioners) a chance to recoup their losses.

It is totally unreasonable to claim $3B for the UK. That sum is almost three time the combined deficit in the US and Canada pension funds. The UK deficit is almost entirely related to STC which was taken over by Nortel and which created the pension shortfall under UK pension law long before Nortel became involved. If the UK is successful in grabbing more than a fair share of the Nortel assets it is purely legal piracy in my opinion.

The Canadian pension administrator Morneau Sobeco should be acting on our behalf to obtain a seat at that mediation table and fighting to obtain as much as possible for Canadian creditors including the pension trust fund.

Canadian Supplemental Health Plan

2010-11-10T16:55:00.001-05:00

I received the following from an NRPC representative today. It will be of interest to Canadian retirees or people planning to move back to Canada.

The NRPC has been able to negotiate a favourable supplemental health insurance plan for former employees of Nortel who are living in Canada. I pass this information on because there may be former employees living in other countries who are worried about what to do when they lose their retiree medical benefits in their country of residence. The plan requires that you be a Canadian resident and provides medical insurance that supplements the provincial insurance plans. Some people might consider re-patriation as a reasonable method of getting ongoing medical insurance.

We have been advised that this plan is available to all former employees of Nortel Canada if they reside in Canada. However, if you consider moving back to Canada, please confirm with Manulife that they will honour this plan in advance including not requiring evidence of insurability.

The note below refers strictly to medical insurance in Canada and has nothing to do with any retiree medical insurance that you might be receiving in the USA or other country. Although the existing retiree medical benefits for former employees in Canada will end on December 31, 2010, at this point I have no further information on when similar benefits may cease in other countries.

Koskie Minsky notice re LTD benefits Nov 8th 2010

2010-11-09T14:33:00.002-05:00

The following was posted on the Koskie Minsky site yesterday

November 8, 2010

In late August 2010, all recipients of long term disability benefits (“LTD-income”), survivor income benefits (“SIB”) or survivor transition benefits (“STB”) received a Beneficiary Estimated Allocation Statement (“BEAS”) from the Monitor. The statement included a preliminary estimate of your LTD-Income, basic and/or optional life benefit, STB or SIB benefit values as of December 31, 2010 based on data as at June 30, 2010.

All individuals who received a BEAS can expect to receive another letter from the Monitor in November, which will ask you to confirm the personal information that was used to calculate the preliminary estimate of your LTD-Income, STB or SIB benefit. If the information contained on the form is correct, you are not required to take any action. If there are inaccuracies in the data contained on the form, then you must make the applicable corrections and return the form to the Monitor. You may direct any questions to the Monitor at 1.866.942.7177 or nortel.monitor@ca.ey.com, or to your Representative counsel at 1.866.777.6344 or nortel@kmlaw.ca

Letter to Canadian Industry Committee

2010-11-08T16:38:00.003-05:00

The following is a copy of the letter I sent to members of the Canadian Industry Committee who had abstained or voted "no" for passage of Bill C-501 in the House of Commons. Feel free to use parts or all of it in writing to the members.

I am writing to request that you and the other members of the Industry Committee support the passage of bill C-501 in the House of Commons.

I am a pensioner who spent 35 years working at Nortel, and during that time I always expected that I would be able to retire with reasonable certainty, and that I could live in dignity with the pension that Nortel promised me.

After the events of the last 21 months, my apprehension and unease with respect to my family's future have grown and have lain heavily on my mind. I now face huge cuts in my monthly pension due to Nortel's bankruptcy and Canada's poor laws to protect pensioners from such a fate.

Canada has always had a reputation of caring for her citizens and especially for seniors who devoted many years helping build the country and the companies they worked for. Please don't let us down now. We urgently need your help

I urge you and the members of your committee to pass Bill C-501, and to make it retroactive to the beginning of 2009 at least, so that Nortel's estate will come under the provisions of the new law giving priority to pension trust funds of bankrupt companies. This action will bring Canada into the same status as many other Westernized nations who have already taken similar steps to protect their pensioners. It will also send a clear message to corporations that their employees and retirees really matter, and that the government of Canada does truly care for the well being and protection of elderly citizens.

Canadian Bill C-501 review in Industry Committee this month.

2010-11-07T14:03:00.003-05:00

Bill C-501 is coming up for review in the Industry Committee of the Canadian Parliament. This bill, if passed with retroactivity, could give Nortel Pensioners a preferred status in terms of the pension claim against the Nortel estate. To help spur the members of the committee into considering the plight of the Nortel Pensioners, the NRPC are requesting that everyone write to as many of the committee members as possible urging them to pass the bill and make it retroactive to January 2009 when Nortel filed for bankruptcy.

You can check out a sample letter on the NRPC website.

You can have a look at Bill C-501 at:
http://www2.parl.gc.ca/HousePublications/Publication.aspx?Docid=4378195&file=4

The meeting will be held as follows:

Meeting 44: November 16, 2010 11:00 a.m. - 1:00 p.m. (EST) 131 Queen St., Ottawa, Room: 8-53
Meeting 45: November 18, 2010 11:00 a.m. - 1:00 p.m. (EST) 131 Queen St., Ottawa, Room: 8-53
Meeting 46: November 23, 2010 11:00 a.m. - 1:00 p.m. (EST) 131 Queen St., Ottawa, Room: 8-53
Meeting 47: November 25, 2010 11:00 a.m. - 1:00 p.m. (EST) 131 Queen St., Ottawa, Room: 8-53

The members of the committee are:

Chair
David Sweet CPC Voted NO Ancaster-Dundas-Flamborough-Westdale
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone:(613) 996-4984, Fax:(613) 996-4986
EMail: Sweet.D@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:English

Vice-Chairs
Robert Bouchard BQ Voted YES
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone:(613) 992-7207, Fax:(613) 992-0431
EMail: Bouchard.R@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:French

Hon. Dan McTeague LPC Did Not Vote Pickering - Scarborough East
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone: (613) 995-8082, Fax: (613) 993-6587
EMail: McTeague.D@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:English

Members
Peter Braid CPC Voted NO Kitchener- Waterloo
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone:(613) 996-5928, Fax:(613) 992-6251
EMail: Braid.P@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:English

Gordon Brown CPC Voted YES Stormont-Dundas
House of Commons, Ottawa, Ontari, K1A 0A6, Telephone:(613) 992-8756, Fax:(613) 996-9171
EMail: Brown.G@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:English

Serge Cardin BQ Voted YES
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone:(613) 943-7896 Fax:(613) 943-7902
EMail: Cardin.S@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:French

Marc Garneau LPC Did Not Vote Westmount - Ville Marie
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone:(613) 996-7267 Fax:(613) 995-8632
EMail: Garneau.M@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:French / English

Mike Lake CPC Voted NO Edmonton - Mill Woods - Beaumont
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone:(613) 995-8695 Fax:(613) 995-6465
EMail: Lake.M@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:English

Brian Masse NDP Voted YES
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone:(613) 996-1541 Fax:(613) 992-5397
EMail: Masse.B@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:English

Anthony Rota LPC Voted YES
House of Commons, Ottawa, Ontario, K1A 0A6,Telephone:(613) 995-6255 Fax:(613) 996-7993
EMail: Rota.A@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:English

Dave Van Kesteren CPC Voted NO Chatham-Kent-Essex
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone:(613) 992-2612 Fax:(613) 992-1852
EMail: VanKesteren.D@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:English

Mike Wallace CPC Voted NO Burlington
House of Commons, Ottawa, Ontario, K1A 0A6, Telephone:(613) 995-0881 Fax:(613) 995-1091
EMail: Wallace.M@parl.gc.caThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it Preferred Language:English

US Court Hearing on Nov 8th 2010

2010-11-06T19:14:00.003-04:00

The US bankruptcy court has a hearing planned for November 8th 2010. There are a number of items on the agenda as outlined in the docket on the Epiq web site.

One item is the motion put forward by Nortel to abandon and destroy historical documents. The destruction of those documents is opposed by at least 3 groups. ACS systems, the UK pension trust, and lawyers representing Frank Dunn have all objected and will be heard on November 8th at the session.

If the objections are overturned and the motion approved, then Nortel may destroy documents that could prove important at a later date in terms of claims and decisions.

I hope that none of these documents relate to defined benefits and details of employee pensions since these will be essential to our claims against Nortel. Since the PBGC has not objected I assume that they are happy with the documents turned over to them for the qualified defined benefits.

However the PBGC is in no way taking responsibility for the non-qualified pension benefits. We are on our own in terms of our individual cases.

Since we were supplied with calculations earlier from Segal, the Nortel paperwork and Segal paperwork should be filed in Segal's offices. Nevertheless it is important that everyone who submitted a claim keep copies of their supporting paperwork handy to ensure that their claim is properly supported.

Latest News from NRPC Canada

2010-11-04T17:04:00.002-04:00

The following topics were reported by the Montreal Chapter of the NRPC.

Financial Sponsorship Model

NRPC & Legal met with the Ontario Minister of Finance on Friday October 29th to review three proposals put forward by unnamed financial institutions. In fact,this was somewhat of a change since their previous position as the government of Ontario showed little interest in pursuing the FSM concept.

As of today, there is no information from the Friday meeting

Canadian Health & Welfare Trust Fund Claim.

At the end of December Canadian pensioners will lose Health & Welfare benefit coverage. Even though Nortel is no longer funding the plan there are remaining assets in the fund, which must be distributed. Various legal groups have made claims against the assets on behalf of pensioners, LTDs etc. The Judge heard the briefs about a month ago and he is expected to render a decision shortly on how the balance in the trust fund will be disbursed amongst the claimants.

If there is no further litigation subsequent to his decision, eligible pensioners should receive a cheque late this year or early next year for their portion of the claim.

Pension Plan Claim
Morneau Sobeco and the NRPC Legal team will be making a claim on behalf of pensioners to recover some of the pension payment losses that will be incurred.

These claims are far from being settled, as there are a number of events that must take place beforehand. The pension claim is part of a larger claims process. To begin with the Nortel assets are been held in a lock box in the US and a Mediator has been assigned to divide the assets between the UK, the US and Canada and not surprisingly each country is trying to get as much of the assets as possible.

The various parties have submitted and exchanged briefs. The parties will be in court in January to come up with a methodology to split the assets between the countries. After a process is in place, hopefully, the mediator and claimants can come up with an agreed division of the assets.

The overall process is very complex and without precedence due to the size of the bankruptcy and will most likely prove to be lengthy. It would be very difficult to predict how long it may take to finalize the process.

Manulife Benefit Replacement Plan

Manulife has been selected as the provider of choice to replace the benefits being terminated by Nortel. This is not a group plan but an individual plan. Each person needs to make a choice based on his or her needs whether to join the plan or not.

In the near future, Canadian pensioners should receive a package of information from Manulife the target date is mid December. The package will include the various options offered, costs & timelines, etc.

The registration period will run from Jan 7 to March 7 with an effective date of January 1. No medical is required. If you register after March 7th, a medical examination may be required.

Canadian Pension Wind-Up process

2010-11-03T10:41:00.002-04:00

The following information is taken from the Morneau-Sobeco, (administrators for the Nortel pension fund), web site for Nortel pensioners. This indicates that a wind-up date has not yet been established. The date will be determined after M.S. have examined all the assets and liabilities and will be included in a report and recommendation to the pension regulator. At this point I assume M.S. are working to assure themselves that they know the full value of the assets, and what the total pension liabilities are for the funds.

One item that is not clear is the inclusion of any payout from the remaining Nortel estate. If there is a percentage payout on our pension claim it will be added to the pension funds assets and used in determining our final reduced pensions. I don't see how a wind-up date can be established until that payout is defined by the bankruptcy court, which may take years to finalize.

Morneau Sobeco Information:

The Wind Up Report
As part of the wind up process, we will submit a recommendation to the appropriate regulatory authority depending on where the pension plan is registered to prepare an order that the pension plan be wound up.

Based on the approved wind up date(s), a final Wind Up Report will be prepared and submitted to the appropriate regulatory authority for their review and approval.This Wind Up Report will contain all members’ final pension benefit entitlements in the pension plan and their individual PBGF coverage, if applicable.

Option forms
Once the Wind Up Report has been approved, we will prepare personalized option forms for each member and former member who is not yet receiving a monthly pension payment from the pension plan.

The personalized option form will set out the pension benefit entitlement and the settlement options available to the member in accordance with the pension plan documents and the applicable legislation and regulations. The member will have an opportunity to advise us of any data corrections that should be made.

Purchasing annuities
In the final stages of our wind up administration, we will purchase annuities through a bidding process from one or more Canadian life insurance companies for pensioners and members who choose the pension option in accordance with the provisions of the pension plan documents and the applicable legislation and regulations.

All pensioners and affected members will be notified of the amount of their monthly annuity and the contact information for the successful insurance company. There will be no interruption to monthly pension payments during the transition period.

Termination Fund- Koskie Minsky statement

2010-11-01T17:07:00.002-04:00

The following statement appeared on the Koskie Minsky site on Nov,1,2010.

November 1, 2010 Termination Fund: Upcoming Payments

The Settlement Agreement that was approved by the Court on March 31, 2010 established a Termination Fund for the benefit of certain Nortel terminated employees who were still owed termination or severance payments. All terminated employees who are eligible for this payment received a letter in September indicating their eligibility and outlining the method of payment.

Please note that cash payments will begin to be made effective October 29, 2010. Some individuals who commenced employment with Nortel prior to 1996 were eligible for a retiring allowance and therefore were provided the option for their Termination Fund payment to be made directly into an RRSP account. Please note that transfers into RRSP accounts are still being processed. Individuals who chose this option should not expect their payment for several more weeks

Nortel US medical plan

2010-11-01T09:55:00.002-04:00

Usually by this time of year Nortel US has sent out a document with details of the medical plan for employees and retirees for the following year. So far we retires have not received anything.

Earlier this year Nortel tried to place a motion before the court to terminate the medical plan, but subsequently withdrew the motion when they were faced with a decision in another court regarding the process by which a company in chapter 11 may terminate a medical plan. At the same time the US NRPC had submitted a motion to the court to consider formation of a voluntary employee benefits association (VEBA). That motion was also withdrwn at a later date.

Today I saw a posting on the Yahoo Nortel Pension Group which indicated that Nortel is actually planning to send out plan information. The posting stated:

" I got an e mail from a Nortel HR person indicating that next month
> (Nov) enrollment packages would be sent out. Usually some tweeking of
> benefits takes place as well as a cost increase. NT is a bit late in sending
> out the enrollment this year. I am surprised the plan is still operational."

Hopefully this is going to happen and that we will see a continuation of the Nortel medical plan for retirees.

UK pension wind-up process and document

2010-10-30T19:13:00.002-04:00

The Nortel Canadian pension administration has been taken over by Morneau Sobeco and they are in the process of working towards determining the wind-up of the pension fund.

In my research into wind-up on the internet I came across the UK process in the document which can be seen at the link below. The document is very detailed with a lot of clear information on what happens during a Pension wind-up in the UK.

http://www.pensionsadvisoryservice.org.uk/occupational_pensions/winding_up

Unfortunately I have not been able to find a document with similar detail on the Canadian process, though I will continue looking.

In the US the registered pension fund was taken over by the PBGC last year and they are administering it and providing pensions as per their rules. Most US pensioners are happy with the process. Some are unhappy since they have had reductions in pension as a result of the PBGC rules. It is possible to determine what happens when the PBGC takes over by examining their site.

Unfortunately in Canada there doesn't appear to be similar clarity and transparency, and as a result many of us are uncertain as to what the actual methodology will be, and how it will be applied. M.S. has placed some summary information on their web-site but it is inadequate to answer many questions posed by pensioners and deferred pensioners as seen on the Yahoo Nortel Pension group site.

The NRPC proposal to extend the life of the fund using alternative methods seems to be a possibility that many of us would prefer, yet the Ontario government and the Canadian Federal government are blocking this approach. Looking through the UK document I see that alternatives to annuities are acceptable in the UK wind-up system.

The Canadian government should do some benchmarking on the US and UK ,at least, and give pensioners better treatment than they currently seem to be doing.

Sale of Carling facility

2010-10-26T17:31:00.003-04:00

Ernst and Young, the Canadian monitors, published their 56th report and posted it on their website. The report contains the details behind the process used to sell the Carling R&D buildings.

At the time of entering CCAA and Chapter 11, there were 3000 people working in the Carling facility. Today there are about 200.

The gross sale price is $208M and the final purchaser was determined after a process which attracted 24 possible candidates.

You can look at the details of the sale on the monitor's website in their reports section, #56.

Monitor's 55th report on Nortel status

2010-10-25T09:51:00.003-04:00

Ernst & Young have posted their 55th report on their website.
The cash position reported is $5.9B cash, with $749 in US, $189M in Canada,$749M in UK and Emea, and $461 APAC for continuing operations.

Some comments by the Monitor.

The Stay Period presently expires on October 29,2010. The Applicants are seeking a 122 day extension of the Stay Period up to and including February 28, 2011. As stated above, based on the cash flow analysis including the assumptions contained therein, the Applicants have sufficient cash resources to fund operations through the requested stay extension.

Termination payments.

On September 17, 1,158 former employees were notified by mail they were eligible for a maximum payment of CAD $3,000 from the Termination Fund. These eligible former employees were requested to confirm their contact information and in certain cases, where service was given prior to 1996, and to elect whether or not to direct part or ll of their payment into an RRSP as an eligible retiring allowance. This had to be completed by October 15, 2010 in order to receive their payment by early November 2010. If this deadline was not met, the payment wil be processed as soon as possible after the confirmation is received by Nortel.

On September 23,2010,279 former employees who were not eligible for a payment from the Termination Fund were notified of being ineligible by maiL.

As of October 15, 2010,78% of former employees who were eligible for a payment from the Termination Fund have returned their confirmation to the Company. It is anticipated these payments wil be processed by early November. The Monitor understands that once these payments are processed, the Company wil attempt to contact those who have not responded in order to reach as many of the eligible former employees as possible.

Canadian Pension Check

2010-10-22T07:24:00.002-04:00

This is the first month after Nortel stopped administering the Canadian Pension trust fund. Morneau Sobeco is now the administrator of the plan. My Canadian pension check stub arrived as per normal from Northern Trust yesterday indicating that they were paying the same amount into my bank account via direct deposit.

It makes sense that Morneau Sobeco would continue to use Northern Trust at least for a while until they get all the database information established and reviewed. It is also nice to see no reduction yet in the pension amount but that will only be for a short time until Morneau Sobeco is able to complete their analysis of the fund assets and liabilities. So future reductions await us.

Nortel Canada Pension Funds NOT Mismanaged

2010-10-20T13:01:00.004-04:00

The following detail was provided in a letter to the members of the CAW by Barry E. Wadsworth, Associate Counsel for CAW, regarding the rumor being spread by elected Canadian government officials that Nortel's Canadian pension fund was mismanaged.

Saturday, 16 October 2010

In recent weeks, the CAW has held several information sessions for the unionized retirees, terminated and LTD employees regarding the Nortel bankruptcy process. An issue was raised regarding Ontario Finance Minister Duncan's statement that the Nortel pension funds were seriously mismanaged. Barry Wadsworth, CAW Legal Counsel and Court-appointed legal representative for over the 600 Nortel unionized employees, has prepared the following which can be used in your letter writing to your MPP and to Minister Duncan and Premier McGuinty:

Letter from Barry Wadsworth, CAW Legal Counsel

Dear Brothers/Sisters,

I have received a request from one of the individuals who attended one of our Nortel information meetings to provide, as I had promised I would, points to refute the Minister of Finance's statement that the Nortel pension plan was mismanaged. These points are as follows.

1. The underfunding of the pension plan was as a result of Government policy, by way of the Pension Benefits Act, which does not require that companies fund pension plans on a fully funded wind-up basis. That is, the Government should require companies to fully fund pension plans as if they might go bankrupt tomorrow. Instead, the Act allows companies to fund pension plans as if they will go on forever and any momentary underfunding will eventually be paid for over time. If there was a requirement for fully funded wind-up funding, there would never be a need for the Pension Benefit Guarantee Fund or losses to retiree incomes when an underfunded plan is wound-up. The costs would be fully borne by the companies and not by transfers from taxpayers to the PBGF.

2. Moreover, part of the current underfunding resulted from the 2008 - 2009 losses in the stock market and therefore the value of the equities held by the fund. This is not mismangement - the level of equities in the pension plan was in keeping with the guidelines set under the PBA. Many, if not all, defined benefit pension plans suffered the same losses.

3. Part of the current underfunding resulted from the lowering of the interest rates, which resulted in a lowering of the return on the bonds and other instruments held by the pension plan. This is the same as for equities, above.

4. If there really was mismanagement of the pension plan then the Financial Services Commission should have stepped in to protect the assets of the plan from the former administrator, Mercers.

5. I have not seen where the government or FSCO have brought any charges against Mercers under the PBA, nor has Nortel - the payor Company, nor any individual or group of retiree beneficiaries under the Plan. This is likely because there was no mismanagement as alleged by the Minister. The remarks were therefore ill advised and baseless.

Barry E. Wadsworth
Associate Counsel
CAW-Canada Legal Department
Last Updated ( Monday, 18 October 2010 )

Canadian Government to buy Nortel Carling building at bankruptcy price

2010-10-19T18:31:00.005-04:00

The following story was published in the Ottawa Citizen last week.

Public Works is set to announce, as early as next week,the purchase of the Nortel Networks campus in west Ottawa for the Department of National Defence, which has wanted for years to consolidate its dozens of offices in the city into several key locations.

The successful purchase of the $150-million Nortel campus will accomplish that goal, government sources say.

DND has been concerned about security, rising rents and aging buildings. The consolidation will also cut costs.

The deal could be announced as early as Monday, but there is concern, however, about how DND employees, many of whom live in Orléans — which some jokingly refer to as CFB Orléans — will take the news.

DND offices are situated in almost 40 locations across the National Capital Region and the move is expected to bring many of those under one roof. The department will continue to operate National Defence headquarters in downtown Ottawa.

Public Works officials said they couldn’t respond to a Citizen request for comment until sometime on Monday or after.

But the head of the Defence Department’s largest union said he had already heard about the department’s move to the Nortel facility, although his organization hasn’t been consulted.

John MacLennan, national president of the Union of National Defence Employees, said his organization is concerned about transportation problems for workers.

“This means Canadian Forces Base Orléans will have to go to work in Kanata,” MacLennan said. “You’re adding on extra time to get to work, from one end of the city to the other and transit services aren’t the best. It’s going to be a challenge for a lot of people.”

MacLennan said the department has more than 9,000 employees in the capital region.

There are already indications that the move for DND offices is being planned.
On Thursday, a top Public Works and Government Services Canada official confirmed that the federal government plans to empty one million square feet of office space in downtown Ottawa.

Claude Séguin, the director general of portfolio management for Public Works and Government Services, told a commercial real-estate conference that the government will leave Centretown office space, equal to 10 per cent of current federal space and about the size of L’Esplanade Laurier, over the next three to five years.
When asked about the Nortel property, Séguin responded: “We have been engaged in the bidding process and at this time it would be premature to say more. There is no agreement in place and we will have no further comment.”

Five years ago, the Defence Department had plans to vacate its various offices downtown and consolidate those into several central existing locations, including in the Louis St.-Laurent Building in Gatineau and in an office complex on Star Top Road. The third main site would have been the JDS Uniphase complex on Merivale Road.
DND eventually had to scrape the acquisition of the JDS complex and the RCMP moved into the campus.

The negotiations to sell the Nortel campus have been underway since the spring. Bidding by private- and public-sector contenders is believed to have gone through two rounds.

Nortel is believed to be seeking $150 million, a price that some think is high.
The federal government has always been seen as the most logical candidate for the 1.7 million square feet of office space. But the government was expected to sign a long-term lease and let private-sector managers and investors provide the financing to buy, renovate and manage the property.

Minto Developments led this approach when it bought the former JDS Uniphase campus for lease to the RCMP.

But Séguin said “we are not contemplating leasing” (the Nortel campus) because of “specific government needs.”

Some experts think the government may be trying to buy the Nortel campus at depressed bankruptcy prices, an approach that worked with some other Nortel properties that it now occupies.

With files from Bert Hill
© Copyright (c) The Ottawa Citizen

NRPC September newsletter

2010-10-18T11:12:00.002-04:00

The Canadian NRPC published a newsletter on their website for September 2010.
The following is the NRPC President Don Sproule's summary.

NRPC Newsletter – Sept. 2010
President’s Letter

A big thank you goes out to over 2000 people who turned up at Queen’s Park on Sept. 15th. You came by the busload from Ottawa, Kingston, Belleville, Brampton, London, Hamilton and Kitchener. Many more drove in from across the GTA. And thanks to the Canadian Federation of Pensioners and the CAW for their support. The large turnout demonstrated to the Ontario government that we will not be silent on the issue of winding up our plan by annuities.

After the rally, Mike Moorcroft and I then proceeded into the Legislature where we were introduced in the Assembly. The first 8000 of our petitions were broken up into two lots, with Yasir Naqvi, my MPP, tabling the first 4000 and Mike's MPP, Charles Sousa, tabling the next 4000 petitions to demand that the Government not wind-up our pension funds with annuities. Since that event, Minster Duncan has indicated that he will not consider our proposed alternative for several unsubstantiated reasons. NRPC representatives had an opportunity on Sept. 23 to speak with Minister Duncan and Premier McGuinty to explain why it will be financial suicide to lock in our losses at this critical low performance level for annuities. We are also requesting their cooperation to complete the Request for Proposal (RFP) process so we have some solid proposals to review with them. Both the Ontario Conservative and NDP parties are very supportive of our proposed alternative and have been keeping the issue alive in Question Period and other legislative venues. Read the Ontario Hansard on-line and see what is happening on our issues. As more petitions roll in, we will also be using them to continue our press on the Government.

For several days, starting on Sept. 29th, the CCAA Court judge will hear a motion on division of the assets of the Health and Welfare Trust (HWT). After careful analysis of the HWT documentation, the court-appointed Monitor recommended that the money in the trust be allocated on a pro rata basis between pensioner life insurance, LTD wage replacement, LTD life insurance, LTD optional life and Survivor Beneficiaries based on their relative claims. Please note that Survivor here refers ONLY to spouses of individuals who died while in active employment by Nortel. It does NOT apply to those spouses of individuals who died as pensioners. After careful, reasoned and principled analysis, your court representatives, the court representatives of the LTD group and the CAW counsel all support that recommendation. While final tabulations will not be made until December 31, 2010, if the Monitor’s recommendation is approved, distributions would be similar to the following estimates:
- $35.05M for Pensioner life insurance
- $30.30M for LTD wage replacement, life insurance and optional life
- $ 6.85M for Survivor Beneficiaries

Outside the courts, the Financial Services Commission of Ontario (FSCO) has just announced that the Morneau Sobeco company will be the Administrator of our pension funds for the wind-up process starting Oct 1, 2010. They must evaluate the plans’ assets and determine the liabilities as of Oct 1, 2010, and then calculate the actual wind-up level of the plan. It is our understanding that no reduction of our pensions will take place until the new Administrator has had time to evaluate the funding level of the plan as of Oct 1, 2010. We expect this analysis to take 4-6 months, if not longer. At that time, they will then present a wind-up plan that must receive approval of the Superintendent of Pensions. In the interim, we will be pursuing ways of ensuring that the plans’ assets are not put into annuities. We will continue to express our strong concern that the fate of all pensioners across Canada must be considered. In addition, we will continue to pursue tax related considerations with the Federal Government to minimize the impact on any lump sum payments resulting from funds disbursement.
Don Sproule

Warring Tribes

2010-10-16T18:29:00.004-04:00

When Paul Stern became CEO of Nortel back in the late 1980s, he offended many people in Northern Telecom and BNR by referring to us as "warring tribes". Perhaps his observation has come home to roost as Nortel's bankrupt estate is fought over by separate geographic units, and ex-employee groups.

What a sad eulogy for a once magnificent company that inspired the world to go digital and optical and helped put Canada on the map as a leader in research and development and especially in telecommunications technology

The UK pension fund is trying to grab a large share of the estate using a British law that holds a parent company responsible for pension trusts regardless of what country it calls home. Never mind that Nortel found itself responsible for all the STC pension obligations that were let slide by the UK before they were taken over by Nortel. In fact the UK claim alone, is as big as the total USA and Canadian pension trust funds combined. Does that make any sense?

The Canada and the US pensioner and ex-employee groups are suspiciously eyeing one another as they look at the estate pot, thinking that their share could be impacted by the claims of the other. The IRS has its claws into the carcass, as does the CRA, and banks and bondholders in both countries are pushing to ensure that they get paid at the expense of the pensioners in Canada who have no protection unlike those in the USA and the UK.

The Nortel Canada disabled employees are opposing the Canadian pensioners in terms of distribution of the Health and Welfare fund claiming that they should have it all since they were left out in the cold by Nortel who failed to establish a proper trust fund to protect these vulnerable employees. One set of victims fighting to leave another set of victims out of any share, whilst the real villain walks away.

And to cap it all, John Roth, a former CEO has placed a one billion dollar claim on the US estate, citing the possibility that he may get sued for letting the company go down the tubes. Rationalize that one if you can.

Whilst all this in-fighting is going on, the lawyers are cleaning up, charging exorbitant fees and sucking the cash blood out of what's left of Nortel, with the approval of the courts. That's the normal modus operandi of these vultures who know their way around the bankruptcy courts. It doesn't matter that they are eating into the funds that rightfully belong to the ex-employees, disabled employees, and pensioners. They get first pick and they are not shy at grabbing large sections of the money to satisfy their greed.

When we look back on this period of our lives it will be with anger at, and embarrassment for a once proud company and country. Canada could have stepped in and stopped this disaster like it did in supporting GM. Canada could have stepped in and enacted laws to protect disabled employees and pensioners suffering from the bankruptcy of the company they helped build. But Canada turned aside and ignored their plight. It's a stain on Canada's reputation as an honorable and caring country who once prided herself on her concern for the weak and the elderly.

Who now will speak for them, and for us?

Nortel groups warring over estate

2010-10-14T08:21:00.002-04:00

Story in the Ottawa Citizen.

Warring Nortel groups turn to mediator to tackle who gets what

By Bert Hill, The Ottawa Citizen October 13, 2010

Nortel Networks is sitting on about $6 billion in cash and assets from the sale of most product lines. However, with billions of dollars more in claims from creditors in Canada, the U.S., Europe and around the world, the battle over division of the modest spoils is intense. Protracted negotiations have failed to generate a settlement.

Now the warring parties are turning to a high-powered Los Angeles lawyer for help. Leyn Phillips, 58, has more than 15 years experience helping Fortune 500 companies find a route out this kind of problem. He is also a former U.S. Federal District Judge and Appeals Court judge whose services don't come cheaply: He gets $1,000 an hour and his Los Angeles firm has charged an upfront $101,250 retainer deal for preparation and five days of alternative dispute settlement magic.

The mediation starts next month, and, if it doesn't work, arbitration by a judge will likely be the final step.

Phillips has some other qualifications that might help in this challenging assignment. He was a top-notch tennis player in his youth who went to the University of Oklahoma on a tennis scholarship. He will be kept busy calling out-of-bound shots in a contest that is long on love (the wrong kind) and perpetual deuces. Watch out for flying racquets and trash talk.

Even if the Nortel assets are divided up, the process won't end soon. The U.S. bankruptcy court in Delaware is booking dates into the spring of 2011, well past the second anniversary of the original bankruptcy filing. One issue is what to do with the millions of pages of Nortel records. Nortel has hired another expensive set of consultants for advice on what to save and what to destroy.

Lawyers for Frank Dunn, the former CEO at the heart of an alleged accounting scandal that sabotaged the company, are objecting. They finally got 22 million pages of Nortel documents after the first batch proved unsearchable by computer, but they also found 30,000 cases of redactions -- removal of key information for privacy and other reasons -- that they want to test. They told the U.S. bankruptcy court that Canadian fraud trial "proceedings will commence in the fall of 2011.''

Read more: http://www.ottawacitizen.com/business/Warring+Nortel+groups+turn+mediator+tackle+gets+what/3661802/story.html?cid=megadrop_story#ixzz12KpvP5Ea

Thankless Canadian Thanksgiving for Nortel Pensioners

2010-10-12T20:33:00.003-04:00

Thanksgiving message on the Canadian NRPC website.

* Pensioner and long term disabled medical insurance disappears at the end of the year

* Pension plans have been taken over by the Financial Services Commission of Ontario in October - current and future pensioners can expect cuts of 35% or greater.

* Canada's federal government cares more about foreign junk bond holders than its citizens

* Canada's bankruptcy laws are antiquated and hurt former employees whereas most other G20 countries protect former employees far better than Canada.

* The Ontario government wants to wind up the pension plans by purchasing annuities which will eat away the value of pensions even further

* Life insurance plans are cancelled at the end of the year so they cannot even afford a decent burial.

* Except for a small pre-payment due this year, severance payment for terminated employees will have to wait until the Canadian estate is settled and will likely pay out at cents on the dollar

Employees at other companies are facing similar issues. Isn't it time that Canada protected it's citizens?

US NRPC update on the withdrawal motion re the VEBA

2010-10-09T13:40:00.002-04:00

I received the following email from the NUSRPC regarding the withdrawal of the earlier motion on forming a VEBA.

NUSRPC MEMBERS UPDATE OCTOBER 8, 2010

The NUSRPC is a volunteer organization. Nothing in this e-mail is intended to be, nor should be construed to be, legal or financial advice.

The NUSRPC today filed a motion to withdraw, without prejudice, it's earlier motion to form a VEBA (Voluntary Employee Benefits Association). The NUSRPC has reserved the right to re-file the original motion at a later time when uncertainties surrounding Nortel's bankruptcy have been clarified and when the motion may have a better chance of succeeding.

This decision was taken upon the advice of our attorney who had communicated with Nortel's attorneys and with the court appointed attorney for the Creditors Committee.

Background

Nortel has not yet decided whether to file a plan of reorganization or a plan of bankruptcy.

In addition other major issues regarding distribution of the Nortel Global estate are unresolved and it is unclear whether resolution of these issues can be done quickly or will take a long time, perhaps years. Nortel's options regarding employee benefits differ depending on how long it takes to resolve these major issues and, in turn, on which sort of plan they choose to file. Nortel made it clear to our attorney that if we were to press our motion now, before these other issues were clarified, they would strongly oppose it.

The NUSRPC believes we have little to gain by pressing the issue at this time.

-Since Nortel will need court approval to cancel benefits, either through a bankruptcy filing or a Section 1114 negotiation, we can wait to see which direction events take and respond accordingly. This includes the possibility of re-filing our motion for a VEBA if appropriate.

-In order for the Health Coverage Tax Credit, which makes the VEBA possible, to continue Congress needs to extend the provisions of the existing American Recovery and Reinvestment Act. Whether or not Congress will extend the Act will become clear in the coming months.

The NUSRPC will continue to monitor developments in the bankruptcy proceedings and will inform you as events occur.