Karma: Lee Iacocca, Chrysler retirees sue over pension losses

[Joanne98]

Lee Iacocca and about 450 other Chrysler white-collar retirees say they lost a big chunk of their pensions when Chrysler went bankrupt, and they'd like their money, please.

A class-action lawsuit was filed in Michigan by attorney Sheldon Miller, who says the retirees lost more than $100 million in supplemental pension payments because of the 2009 bankruptcy.

The lawsuit claims that neither former Chrysler owner Daimler nor Cerberus, which bought the company from Daimler and lost it in bankruptcy, properly safeguarded the funds for retirees -- known as "Rabbi Trusts." Such funds are not regulated by the federal Employee Retirement Income Security Act.

Daimler or Cerberus could have switched the retired workers funds to annuities, the lawsuit argues, as Daimler did in 2005 for white-collar employees still working for Chrysler. Cerberus also did nothing to protect the accounts, the lawsuit says.

Iacocca, who is living out his retirement in Bel Air, Calif., did not want to comment.

http://content.usatoday.com/communities/driveon/post/2010/09/lee-iacocca-and-450-sue-chryslers-former-parent-companies/1

[gateley]

1. "Such funds are not regulated by the federal Employee Retirement Income Security Act"

'Nuf said.

[napi21]

2. I don't blame them for suing. Especially since there was

a precident set when Daimler move pension funds to protact them. Yea, I know all of the 500 have lots of $$ already, but they still have a right to have their pensions protected.

[Omaha Steve]

3. Anytime you loose a pension...

It is income you have planned on and budgeted for. Lee is not a typical representative of this group, he is just part of the overall group.

K&R.