Xerox pension lawsuit still alive

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For years, Paul Frommert expected a pension payment of more than $2,000 a month when he retired from Xerox Corp.

Instead, he learned in the mid-1990s, he’d be getting less than $10 a month.

Screen Shot 2013-12-31 at 8.04.14 AMIn 2000, Frommert sued the company, claiming it had used an illegal accounting method to determine the pensions. Despite a 2010 trip to the U.S. Supreme Court, the lawsuit is still alive — and will continue to be so because of a ruling Dec. 23 from a New York-based federal appellate court.

The U.S. Court of Appeals for the Second Circuit ruled that a plan administrator’s plan for pension payments to Frommert and others who sued is “absurd and contradictory” and “therefore unreasonable” when compared with the company’s typical pension payouts. The Xerox plan administrator is tasked with crafting a resolution for the pension dispute.

Screen Shot 2013-12-23 at 12.26.21 PMNow, for the third time, the lawsuit will return to U.S. District Judge David Larimer, based in Rochester, for more arguments and a ruling.

Xerox is reviewing the appellate ruling, said company spokesman Bill McKee.

The lawsuit involves a small subset of Xerox employees — those who once worked for the company then left, because of layoffs or their own choices, and later returned. Nonetheless, the lawsuit has been closely followed in the circles of pension analysts, largely because of the continued move from traditionally secure pensions to riskier market-determined plans.

Screen Shot 2013-12-20 at 2.22.38 PMAlso, the lawsuit could become a legal weather vane for a largely untested issue — how definitive and transparent must a notice be of changes to an employee’s pension.

“That’s where a lot of the battles in these (pension) cases are now going to be fought,” said Frommert’s attorney, Peter Stris, who is based in Los Angeles.

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