Federal Court rules in DSRA lawsuit: Salaried Retirees entitled to discovery on all counts against PBGC; count against US Treasury Defendants dismissed.

September 6, 2011, for immediate release:       Click here for printable release

On Friday September 2nd, Judge Arthur Tarnow in the Eastern District of Michigan issued two rulings regarding the lawsuit being pursued by the Delphi Salaried Retirees. Last September the Court ruled that the Retirees’ claims against the PBGC could proceed, and that the case should proceed to discovery so that the Retirees could pursue documents and other evidence related to their claim that the Salaried Plan was improperly terminated for political reasons. On Friday Judge Tarnow issued a new ruling reiterating that discovery was to proceed on all four counts against the PBGC, and rejecting out-of-hand the PBGC’s argument that the court should limit its review of the Salaried Plan’s termination to a deferential administrative record review. The Court also granted the Salaried Retirees’ proposed Scheduling Order, in which the parties will have until the end of April, 2012 to complete discovery. That will allow the Retirees approximately seven months to assemble evidence in the form of documents and deposition testimony from those directly involved in these decisions.

The judge also issued a ruling dismissing the claims against the US Treasury defendants, finding that the Complaint, as currently stated, fails to include sufficient factual allegations against those defendants. The Court noted that it felt this result was required by two recent U.S. Supreme Court decisions emphasizing the need for fact-specific allegations, and the Court went so far as to note that perhaps the claims against the Treasury Defendants would not have been subject to dismissal had the Complaint been considered under the law as it existed prior to the Supreme Court’s recent rulings. Notwithstanding that the claims against the Treasury defendants were dismissed, the Court did not preclude the Retirees from asking to be allowed to amend the complaint at a later time to add additional factual allegations. The judge also stated in his ruling: “The Court also anticipates that [the Retirees] will continue to utilize the political process to pursue the relief they seek.” In fact he specifically said “the subject of the complaint may be a matter that is best resolved through the political process.”

The Retirees will now begin to depose individuals who have direct knowledge of the decision-making process and will demand the documents the PBGC has worked to keep hidden. They will also continue to work with local, state and national political figures in the hope that a political solution can be achieved. The Retirees are asking only to be treated in a fair and equitable manner by their government which has either caused or allowed taxes paid by all Americans to be used only for specific and politically favored groups. These are decisions that the UAW leadership has called “a grave injustice” and have also been a matter considered in four separate hearings in the United States Senate and the House of Representatives, most recently in June where representatives from the Obama Administration and the PBGC were questioned.

Bruce Gump
Chairman Warren Legislative Group
Vice-Chairman, Board of Directors
Delphi Salaried Retirees Association
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