For over 50 years, Bloomberg Tax’s renowned flagship daily news service, Daily Tax Report® has helped leading practitioners and policymakers stay on the cutting edge of taxation and...
Nov. 22 — Defunct telecommunications company Nortel Networks Inc. won a victory in its fight with federal pension regulators when a bankruptcy judge rejected a briefing schedule proposed by the Pension Benefit Guaranty Corporation ( In re Nortel Networks Inc. , Bankr. D. Del., No. 1:09-bk-10138-KG, minute entry 11/22/16 ).
Nortel, which filed for bankruptcy in 2009, had clashed with the PBGC over how to value the company’s unfunded pension liabilities. The PBGC claimed in 2009 that Nortel owed $593 million in pension payments, but the agency upped that amount to $708 million in 2014, a move that Nortel said lacked factual support.
The judge’s Nov. 22 decision setting an evidentiary hearing for Jan. 9-11, 2017, is a win for Nortel, which argued that the PBGC should be forced to turn over documents relevant to its valuation process. This move could signal the judge’s ultimate willingness to settle on a liability figure closer to Nortel’s suggested amounts, which ranged from $180 million to $460 million—well short of either amount proposed by the PBGC.
In seeking to resolve the parties’ legal disputes without formal discovery, the PBGC argued that all six bankruptcy courts that have considered the PBGC’s valuations since 2003 have resolved the cases on legal grounds and without considering discovery. Nortel contested this assertion, arguing that the PBGC’s position boiled down to the “single myopic concept” that discovery would be “too expensive.”
The decision was issued by Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware. Gross didn’t provide a written explanation for his decision.
To contact the reporter on this story: Jacklyn Wille in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Jo-el J. Meyer at email@example.com
Text of the court entry is at http://www.bloomberglaw.com/public/document/Nortel_Networks_Inc_et_al_and_Ernst__Young_Inc_As_Monitor__foreig/4.
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)