A judge overseeing the leftover assets of pre-bankruptcy Chrysler LLC has rejected pension claims from five former Chrysler executives, including Bob Lutz.
As part of its 2009 bankruptcy, Chrysler agreed to cover the supplemental pensions of active executives but not for retired executives.
Last month, U.S. Bankruptcy Judge Stuart Bernstein denied the claims of Lutz, Gary Henson, Richard Schaum, Donald Miltz and Fred Luss, saying their benefits under Chrysler's supplemental executive retirement plan should have been transferred to the new Chrysler when it exited bankruptcy in June 2009. Their attorney, Mayer Morganroth, filed an appeal March 5.
Morganroth estimated the supplemental pensions at stake amounted to more than $10 million for those five former executives and a little more than $3 million for Lutz.
This was a supplemental pension plan for executives at a certain level and above. It did not represent all pension obligations to retired Chrysler executives.
Morganroth argued that the automaker could not agree to pay only part of his clients' pension benefits. He asserted that all pensions were an executory contract that must be transferred to the post-bankruptcy Chrysler.
In the bankruptcy, the viable assets of Chrysler were spun off into a new company. Key holders of Chrysler debt lost their investments. Fiat took control of 20% of the company, which received $12.1 billion in taxpayer loans, most of which have been repaid.
Most Popular Stories
- Chinese May Have Spotted Malaysia Airlines Debris
- Social Media Causee Sleep Deprivation in Students
- Obama, Ukraine Discuss Russian Incursion in Crimea
- First-time Jobless Claims Drop Unexpectedly
- General Electric Plans IPO of Credit Card Unit
- Why Buffett Bets Big on Green Energy
- SXSW Crash Kills 2, Injures 23
- First-time U.S. Jobless Claims Hit 3-month Low
- 'Candy Crush' Maker Files IPO
- U.S. Business Inventories Up, Retail Sales Down