Update on Obama Administration's Theft of Delphi Salaried Retirees Pensions

DSRAIn August of 2012, I began a series of articles titled, "A Lawless Presidency" and began looking into a huge scandal that involved the Obama Administration taking the pensions from salaried workers of Delphi and then "topping up" the pensions of certain auto union workers to grease the wheels for Judge Robert Gerbers lightning fast GM bankruptcy. Part 1 was titled, "Obama Administration Rips Off Non-Union Delphi Pensions While Preserving Union Pensions". 

The Delphi bankruptcy case was overseen by Judge Robert Drain who also presided over the infamous Hostess bankruptcy. Drain has been very inconsistent in how he rules on pensions and union labor contracts in bankruptcy proceedings.

Following is an interview I conducted with Congressman Mike Turner (R-OH) where he described the entire process of the Delphi bankruptcy as "a miscarriage of justice."

The following is an update from the Delphi Salaried Retirees Association describing the progress that has been made during 2013:

We continue to win in the courts at every critical juncture as our legal battle moves into its fifth year.  Simply stated, the Pension Benefit Guaranty Corporations unnecessary termination of our pension plan in 2009 violated the Employee Retirement Income Security Act of 1974 (ERISA) because:
  • The PBGC went ahead and seized our plan without seeking the required approval of a federal district court;
  • The PBGC made no provision for substantial safeguards of the interests of retirees and our beneficiaries, as the PBGC is required to do.  Instead, the PBGC released liens against Delphis foreign assets that would have helped protect retirees interests;
  • Delphi Corp, as the Plan Administrator, acted not as a fiduciary in the interest of retirees and beneficiaries, as required, but rather because it was being pressured by the federal government to terminate the plan as part of the governments orchestrated effort to restructure the U.S. auto industry as expediently and cheaply as possible.
The PBGC also violated our Fifth Amendment Constitutional right of due process when it terminated our plan without giving salaried retirees meaningful notice and an opportunity to defend our interests in a federal district court hearing.
For more than four years, U.S. taxpayer-paid government lawyers have taken advantage of every procedural roadblock the law allows to hide emails and other evidence that the Court has ordered be given to us.  President Obama has ignored our direct appeal that he order a review his Auto Task Forces handling of our pension plan during the 2009 economic crisis.
Importantly, in a civil case like this one, its only necessary that we show a “preponderance of evidence” and not prove "beyond a reasonable doubt” in making our case.  And we already have strong evidence from multiple government and third-party sources.  Records of communication between the PBGC, Treasury’s Auto Task Force (ATF), and GM clearly show that Treasury was calling the shots, and the PBGC was merely following orders.  The PBGC’s stated rationale and legal basis for its termination of our plan in 2009 fall apart in the presence of these documents.
Now, the PBGC and Treasury are continuing their cover-up of even more emails and records because we are certain that this additional evidence is so compelling in our favor.  But we are closer than ever to breaking the cover-up:
In U.S. District Court in Detroit against the PBGC:
In August, this Court ordered (Michigan Court order) the PBGC to turn over approximately 30,000 documents it continues to withhold.  The PBGC has appealed, but we expect to receive thousands of key documents substantiating our case once the judge rules on the PBGCs appeal.
In U.S. District Court in the District of Columbia against U.S. Treasury:
Treasury continues to hide a relatively small but important trove of evidence.  On 10/25/2013, we filed with the Court a well-researched, 51-page legal argument on why U.S. Treasury should end its cover-up. It lays out powerful evidence showing that the PBGC abandoned its early desire to protect our pensions, which the PBGC is supposed to do, after being pressured by the Auto Task Force to act politically rather than legally. We await a judge’s ruling.
Key Developments in Congress:
We are optimistic that the House Oversight Committee will continue its efforts to find out what happened.
The 8/15/2013 SIGTARP Audit Report examining our pension plan’s 2009 termination found that all major decisions were driven by Treasury.


We are heartened by Senate Finance Committee Chairman Max Baucus announced intent to include Health Coverage Tax Credit (HCTC) extension in the Trade Adjustment Act (TAA) legislation to be taken up by Congress in early 2014.

TexasGOPVote will continue to keep our readers informed about this case and the continuing miscarriage of justice that has caused 20,000 Delphi workers, including many in Texas, to lose up to 70% of their hard-earned retirement pensions.

More information about other bankruptcy related issues can be found at Bankruptcy Law Review.


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