March 4, 2016
On February 29, 2016, Justice Wilton-Siegel released his decision following an eight day trial regarding claims submitted by U.S. Steel Corporation (USS). The trial follows a motion by USS for approval of a secured claim of approximately $122,471,525 and a unsecured claim of $1,975,745,038 in the claims process of USSC.
The claims were objected to by various stakeholders including the province of Ontario, the USW and Representative Counsel on behalf of non-USW retired and active employees. The main objection from the stakeholders was that the USS claims were equity claims rather than debt and should be treated with the lowest priority.
In its February 29th decision, the Court found that all the amounts were in fact debt. To view a copy of the decision please click here.
We are reviewing the court’s decision with our client committee and will be discussing next steps with the USW and the Province of Ontario.
We note that the decision is limited to the determination of whether the USS amounts at issue should be classified as either “debt” or “equity”. The issue of priorities and future distributions among creditors of USSC was not before the court. We have already asserted a first priority claim based on the statutory deemed trust on behalf of the USSC pension plan beneficiaries for all amounts that are owing, or will be owing, by USSC to the pension plans, and which is be paid to the pension plans ahead of any secured claims of USS.
We will provide updates as information becomes available.