Nortel Networks Corporation, August 2, 2019
August 2, 2019
On July 23, 2019, the Financial Services Tribunal released its decision ordering the Chief Executive Officer to carry out the Notice of Intended Decision (NOID) which would allow the Pension Benefits Guarantee Fund (PBGF) to recover amounts relating to the loss of indexation that were recovered.
As previously advised, Koskie Minsky, on behalf of the Court-appointed Representatives challenged the NOID arguing that amounts recovered during the CCAA proceedings for indexation should be used only to compensate members, rather than being used to reimburse the PBGF, since indexation was not guaranteed under the PBGF.
The FST disagreed with the position, however, and held that the Indexation Addenda that were prepared by Morneau (dealing with the amounts we objected were going to be directed to the PBGF as a refund) met the requirements of the Act and Regulation “and protect(s) the interests of the members and retired members and other beneficiaries”.
Representative Counsel and the Representatives are currently reviewing the decision and considering whether to appeal. We will provide an update as further information becomes available.