Kokomo — A group of then-Delphi Corp. retirees saw a long road ahead of them when they banded in 2009 to keep hold of their full pensions and benefits.
“In general, I’m pretty happy with the fact that our people have not lost heart,” said Paul Dobosz, who retired from Delphi Electronics & Safety in Kokomo. “We’ve had some pretty good successes. We knew this was not going to be a short-term battle.”
At age 61, Dobosz was one of thousands of the Troy, Mich.-based automotive supplier’s employees who opted for early retirement as the company underwent bankruptcy and restructuring that lasted from 2005 to 2009.
During the four years, Delphi’s pensions for unionized hourly workers moved to the auto supplier’s former parent company, General Motors, which was undergoing its own restructuring.
At GM, hourly employees received “top ups” to full funding for their pensions as part of their union agreements.
Delphi held onto salaried employees’ pensions until 2009, when the Pension Benefit Guaranty Corp. took over the plans.
The salaried Delphi employees lost between 30 percent and 70 percent of their pensions as a result, as well as their insurance.
Dobosz, a Noblesville resident who now runs a consulting business, received a letter in February 2009 telling him he would lose his insurance benefits. He and other Delphi retirees from Indiana throughout the U.S. formed the DSRA that year and filed a federal lawsuit to reclaim the pensions.
“We have nothing against [United Auto Workers],” said DSRA Chairman Den Black. “They earned their pensions, and they’re getting it. We earned our pensions, and we’re fighting for it.”
It has been a two-arena legal dispute: in the courts and in government.
DSRA members have received support from federal legislators.
“It’s a very lengthy list, on both sides of the aisle for that matter, Democrats and Republicans, who have, in one fashion or another, made efforts to provide support for getting justice,” Black said.
The retirees’ case received congressional attention in two hearings in 2011.
In June, members of the House Committee on Oversight and Government Reform heard testimony from Ron Bloom, a former White House manufacturing adviser, and Vince Snowbarger, a PBGC deputy director. Questions surrounded the disparity between hourly and salaried workers’ treatment during GM’s bailout.
The committee had a follow-up hearing in November in Dayton, Ohio.
“I want to emphasize that PBGC treated the Salaried Plan no different from the Hourly Plan,” Snowbarger testified during the November hearing. “The only difference in treatment of participants results from GM’s decisions.”
Since then, committee members, including Rep. Dan Burton from Indiana’s 5th District, have pressured the government officials involved with GM’s bailout and Delphi’s pensions about why some workers received retirement benefits when others did not.
Oversight and Government Reform Committee member Michael Turner from Ohio issued a statement in late January demanding Snowbarger answer questions following up on the hearing.
“Despite my attempts to facilitate timely responses to these questions, over two months, no answers have been forthcoming,” Turner wrote in a letter to Snowbarger. “I am deeply disappointed in the undue delay you continue to impose on this matter.”
Senior U.S. District Judge Arthur Tarnow in September granted permission to attorneys to begin the discovery phase in the DSRA’s lawsuit against the PBGC.
The court decision, which came alongside one to throw out the DSRA’s claims against the U.S. Treasury and several other defendants, has allowed each side of the legal dispute to begin collecting evidence for a trial.
The PBGC, since the September decision, has challenged the scope of discovery, meaning the organization has questioned what should be handed over as evidence.
Attorneys for the PBGC, throughout the case, have stated the agency handled the Delphi pensions in the same way as all other plans it has had. So a court trial is unnecessary, they have said.
“They don’t think they should give us anything,” said Chuck Cunningham, legal liaison for the DSRA. “They’ve maintained all along they don’t deserve anything.”
The most recent filing, which was Jan. 13, presents each side’s position on whether the PBGC should provide certain documents as evidence to the court.
Tarnow gave until the end of March for discovery. But attorneys might have to request an extension if they cannot collect enough evidence because of delays, Cunningham said.
In the PBGC’s court filings, attorneys state the agency followed the same practice that it had with more than 3,500 cases since 1974.
Black said the case has cost the DSRA “millions of dollars” in attorney fees and court costs. He and Cunningham declined to provide an exact amount.
The organization has been collecting donations through its website and in the mail to cover legal costs.
Black said the DSRA is “well-funded.”
“We will not ever cease,” he said. “The idea, which is what government entities think you might do, is to bankrupt us. They won’t ever do it.”
• Daniel Human is the Kokomo Tribune business reporter. He can be reached at 765-454-8570 or at daniel.human@ kokomotribune.com.