A long time ago, I was told a little phrase which stuck with me: “Sometimes, you may be done with history, but history isn’t done with you.” It made a lot of sense to me. Just because you’ve finished with something doesn’t mean it’s over for the other party. Seems like Daimler and Cerberus are learning this the hard way.
Associated Press (via Google News) is reporting that more than 450 former Chrysler executives, including turnaround artiste Lee Iacocca, are suing Daimler and Cerberus. The suits say in the suit that they lost $100m in pensions in Chrysler’s bankruptcy. Sheldon Miller, one of the lawyers working on the case, said that supplemental pensions were not transferred to the new Chrysler during its bankruptcy and “as a result, each of the plaintiffs lost large percentages of their earned retirement pensions.” Hmmm, when rank and file members lose benefits, it’s collateral damage to help the company stay strong. When executives lose benefits, it’s lawsuit time.
$100m needs deep pockets, so the boys in Stuttgart, Daimler, were not forgotten in this affair. The lawsuit mentions that Daimler failed to protect the pensions properly. They could have, as posited in the suit, converted the pensions into annuities to protect them. Why does the suit say this? Because Daimler did do this in 2005 for active executives when Chrysler started showing failings.
However, this suit is retrospective. It is not being filed against “New” Chrysler. It’s filed againt Daimler and Cerberus. Suddenly, Mr Miller turned into a “bailout” cheerleader. “Everybody involved in this suit loves that company (“New Chrysler”) and like everybody else wants to see it succeed,” said Mr Miller, “The plaintiffs in our case are trying to assure that there won’t be similar hardships for Chrysler’s current employees, many of whom worked for and with the people involved in this suit.” OK, a couple of problems with this statement.
1. They’re only doing this lawsuit so there won’t be similar hardships for current Chrysler employees? So, it’s got nothing to do with the $100m they’re trying to claim back?
2. “The plaintiffs in our case are trying to assure that there won’t be similar hardships for Chrysler’s current employees…” “Similar hardships”? Does he think that a certain company may go bankrupt again? Nah, of course not! I’ve got to stop reading TTAC. I’m becoming too cynical…am I?