Xerox Announces Proposed Settlement for Pension Lawsuit
Press release from the issuing company
STAMFORD, Conn.--Nov. 14, 2003-- The Xerox Corporation Retirement Income Guarantee Plan has reached an agreement in principle to settle the pension-related Berger v. RIGP litigation. The terms of the proposed agreement require RIGP to settle the case for $239 million. The final settlement is subject to the negotiation of a definitive agreement and court approval.
In April, Xerox reported a first-quarter pre-tax charge of $300 million to cover any potential pension-funding shortfall should RIGP be required to pay damages in this case.
If the court approves the final agreement, RIGP will pay the settlement amount from its assets. Should the company need to make a cash contribution to compensate for a potential shortfall in the plan related to this litigation, it would not be required to begin doing so until 2005.
RIGP is the primary pension plan for Xerox's salaried employees in the United States. On July 25, 2000, a lawsuit was filed against RIGP in the United States District Court for the Southern District of Illinois. The plaintiffs claim that the plan improperly calculated lump-sum distributions from cash balance retirement accounts, resulting in lower benefits for certain employees who left the company between Jan. 1, 1990, and Dec. 31, 1999.
Former Xerox employees who are eligible to receive damages will receive notification when the settlement is approved.
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