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
Monday, October 18, 2010
Saturday, October 16, 2010
Warring Tribes
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?
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?
Thursday, October 14, 2010
Nortel groups warring over estate
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
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
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