Former Sears workers want to recoup pension shortfall by targeting shareholders
Shoppers enter and leave a Sears retail store in Toronto on Thursday, October 19, 2017. THE CANADIAN PRESS/Nathan Denette
The Canadian Press
Published Thursday, February 15, 2018 12:09PM EST
TORONTO -- Former Sears Canada workers are hoping they can recoup a $270-million pension fund shortfall with a motion they will file in court later today.
The workers are asking for a litigation trustee to be appointed to examine about $3 billion in payments made to shareholders since 2005, when U.S. hedge fund ESL Investments and its CEO Eddie Lampert took control of Sears.
The bulk of the $3 billion went to Lampert and his company while Sears was struggling for survival.
In a blog post, Lampert says Sears still had $500 million in cash available for use and no debt after the divided payments were made.
He says ESL has suffered significant losses from Sears's 2017 bankruptcy and that he regrets the failure of the company.
Lampert claims the former employees' $270-million figure is deceitful because it conflates Sears' retirement plan with health, dental and life insurance that he says has gone unfunded since 2008.
In their motion, the workers also say they are owed $400 million for unpaid health and life-insurance benefits.