IBM vows to appeal key pension ruling

IBM said on Thursday it would appeal a federal court ruling that it must compensate workers and retirees who were judged to have lost out when it abandoned its traditional pension plan, a ruling that could cost IBM billions of dollars.

In the ruling released on Wednesday, U.S. District Judge G. Patrick Murphy said 140,000 IBM employees and retirees were entitled to compensation for retirement benefits they lost when IBM shifted to a cash-balance plan from its traditional pension.

International Business Machines Corp. and lawyers for the plaintiffs will meet in a hearing on Monday to begin discussions about how to determine the prospective payments to the employees and retirees who were affected by the changes in the pension funds.

The amount of that potential compensation is still undecided, IBM spokesman Kendra Collins said. But in court documents filed in December, IBM had said that based on one scenario proposed by the plaintiffs, it could be forced to pay up to $6 billion.

“We will appeal,” Collins said, declining to put a timeline on how long the discussions about determining the remedies would take.

Armonk, New York-based IBM, the world’s largest computer company, disputes the initial court ruling in July last year that it had improperly changed the terms of its pension fund in a way that discriminated against older workers and retirees.

The case is being watched because of its potential implications for other major corporations where employees have complained that pension and health care benefits were reduced in corporate cost-cutting moves.

For Subscribers

FOR SUBSCRIBERSAbdul El-Sayed tries to woo MAHA voters as Democrats seek inroads with RFK’s supporters

FOR SUBSCRIBERSKratom-like substances are popping up in a typically benign supplement

FOR SUBSCRIBERSGOP super PAC increases its spending for Sen. Jon Husted in tough Ohio race

FOR SUBSCRIBERSRecords reveal tumultuous marriage between slain New York Times executive and wife

FOR SUBSCRIBERSFrom clean energy warrior to ‘wall of shame,’ James Talarico reverses on a fossil fuel money pledge

FOR SUBSCRIBERSCongressional staff planned official trip with luxury stops in Italy and France weeks before election

FOR SUBSCRIBERSA harrowing ordeal aboard an Israel-bound plane

FOR SUBSCRIBERSOpenAI CEO Sam Altman to skip congressional hearing on rogue AI agents

FOR SUBSCRIBERSKey DOJ lawyers departed Trump ‘grand conspiracy’ probe amid pressure to produce, source says

FOR SUBSCRIBERSTrump’s new AI chatbot often links to a site launched under Clinton 26 years ago

FOR SUBSCRIBERSAt MAHA summit, industry CEOs the movement once vilified take the stage

FOR SUBSCRIBERSThis Paralympian has two goals: Win medals and give away $500,000 to her teammates

FOR SUBSCRIBERSCornell rape allegation spotlights stringent New York state laws that have long drawn criticism

FOR SUBSCRIBERSThe debate over AI’s future rages on both coasts

FOR SUBSCRIBERSDecades-old march dispute reignites in Northern Ireland, threatening political crisis

Companies in addition to IBM that moved to “cash-balance” pension plans in the 1990s include Eastman Kodak Co. and Electronic Data Systems Corp.

For Subscribers

FOR SUBSCRIBERSAbdul El-Sayed tries to woo MAHA voters as Democrats seek inroads with RFK’s supporters

FOR SUBSCRIBERSKratom-like substances are popping up in a typically benign supplement

FOR SUBSCRIBERSGOP super PAC increases its spending for Sen. Jon Husted in tough Ohio race

FOR SUBSCRIBERSRecords reveal tumultuous marriage between slain New York Times executive and wife

FOR SUBSCRIBERSFrom clean energy warrior to ‘wall of shame,’ James Talarico reverses on a fossil fuel money pledge

FOR SUBSCRIBERSCongressional staff planned official trip with luxury stops in Italy and France weeks before election

FOR SUBSCRIBERSA harrowing ordeal aboard an Israel-bound plane

FOR SUBSCRIBERSOpenAI CEO Sam Altman to skip congressional hearing on rogue AI agents

FOR SUBSCRIBERSKey DOJ lawyers departed Trump ‘grand conspiracy’ probe amid pressure to produce, source says

FOR SUBSCRIBERSTrump’s new AI chatbot often links to a site launched under Clinton 26 years ago

FOR SUBSCRIBERSAt MAHA summit, industry CEOs the movement once vilified take the stage

FOR SUBSCRIBERSThis Paralympian has two goals: Win medals and give away $500,000 to her teammates

FOR SUBSCRIBERSCornell rape allegation spotlights stringent New York state laws that have long drawn criticism

FOR SUBSCRIBERSThe debate over AI’s future rages on both coasts

FOR SUBSCRIBERSDecades-old march dispute reignites in Northern Ireland, threatening political crisis

“If certain of the aspects are ruled and upheld to be discriminatory in nature, or have the effect of discrimination, then obviously plans will have to be rewritten to work around that and to eliminate the problem,” said Howard Silverblatt, market equity analyst at Standard & Poor’s.

Since this is just one step in what will be a protracted legal battle, the process will continue to hold up some companies trying to decide what type of pension accounts can be offered, Silverblatt said.

The case in question was prompted when Kathi Cooper, an IBM employee, sued the company in federal court in Illinois, saying that IBM’s pension plan violated age discrimination provisions of the Employee Retirement Income Security Act.

Cooper said that when IBM appeals the case, it will move to a Chicago court, where she will continue her legal battle. “I’m prepared to go all the way to the Supreme Court,” she said.