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April 02, 2013 at 06:21 AM
NEW YORK (AP) — Retirees have gained class action status for a suit against Verizon Communications Inc. over the transfer of its pension obligations to Prudential Insurance.
A federal judge in Dallas on Friday ruled that the lawsuit met the conditions for a class action.
In December, New York-based Verizon transferred the obligation to pay pensions for 41,000 retirees to Prudential, along with $7.5 billion in funds. The Association of BellTel Retirees tried to stop the deal, on the grounds that it would weaken the legal protections for retirees. It effectively turned the company’s defined-benefit pensions into annuities to be paid by Prudential. Annuities aren’t covered by the federal Pension Benefit Guaranty Corp. or the Employee Retirement Income Security Act. A federal court ruled then that the retirees had failed to show that they were likely to be harmed by the deal.
Verizon had no comment on Friday’s class action ruling. The Association of BellTel Retirees welcomed it, saying the case could set an important precedent.
