For more stories like this, sign up for the PLANSPONSOR NEWSDash daily newsletter.
Compliance March 3, 2006
AK Steel Charged $46M for Miscalculated Pension Benefits
March 3, 2006 (PLANSPONSOR.com) - AK Steel Corp. has
been ordered to pay at least $46.2 million to 1,250 former
employees in a class action lawsuit over miscalculated lump
sum pension benefits.
Reported by Rebecca Moore
The Associated Press reports that US District Judge Sandra Beckwith of the US District Court for the Southern District of Ohio ordered AK Steel to pay around $37.6 million in damages and $8.6 million in pre-judgment interest, along with post-judgment interest accruing at the rate of 4.7% per year until the payment is made. An attorney representing the plaintiffs says post-judgment interest is accruing in the amount of about $6,000 per day over the entire class.
In a notification to the Securities and Exchange Commission AK Steel said that it intends to appeal the ruling, according to the AP. The company also said that if its appeal does not succeed, the payments to class members may have a “negative impact on the company’s consolidated financial position, results of operations and cash flows.”
The 2002 lawsuit had charged that the company miscalculated lump sum pension payments to retired participants of its Retirement Accumulation Pension Plan. The plaintiffs all retired or were terminated on or after January 1, 1995, and got their pension benefits in a lump sum by April 1, 2005.