Navistar Agrees To $742M Settlement To End Decades-Old Retirement Benefit Class Action

Navistar Retirement Benefits Class Action Lawsuit Overview: 

• Who: Navistar has agreed to an estimated $742 million plus interest settlement to resolve claims related to when it cut its employees’ retirement and life insurance benefits in the 1980s. 
• Why: Navistar pledged to make annual payments to help fund the benefit programs back in 1993.
• Where: The class action lawsuit was filed in Ohio federal court.

Navistar International has agreed to a settlement worth an estimated $742 million to resolve claims concerning the company’s employment and retirement benefit programs. 

The funds, which will include interest, will be distributed in the form of additional health care benefits for union and salareed Navistar retirees, according to the company.  

The settlement was tentatively approved on Jan. 10 with a fairness hearing scheduled for June 9.

Navistar, which is not acknowledging any wrongdoing, had previously cut its employees’ health and life insurance benefits in the 1980s, claiming at the time that it could not afford to pay them, FreightWaves reports. 

The settlement will resolve a complaint that has been floating around the court system since 1992, around which time Navistar pledged to make annual payments to help fund health and life insurance benefits for both union and nonunion retirees. 

Navistar hinted at filing for bankruptcy back in 2010; however, the United Auto Workers objected to the idea, as did the Supplemental Benefit Committee overseeing a trust the company had been paying into, FreightWaves reports. 

Class Includes Present, Future Retirement Program Participants

The settlement class includes present participants and those eligible to become participants in Navistar’s retirement and life insurance programs, as well as all eligible and future-eligible spouses and dependants. 

Terms of the settlement dictate that no more complaints can be brought against Navistar over any current disputes. 

Traton SE, the holding company of Volkswagen AG, purchased Navistar last year for $3.7 billion, FreightWaves reports. 

In October, a separate class action lawsuit was filed against Navistar after a May data breach exposed the personal and private information of more than 63,000 of its current and former employees. 

The lead plaintiff, a current Navistar employee, argues the company failed to protect its workers’ information by allowing the breach to occur. 

Navistar also made headlines back in 2019, when it agreed to a $135 million settlement with truck drivers who claimed the company intentionally sold diesel engines that were defective. 

Have you been or will you be a participant in any of Navistar’s retirement and life insurance programs? Let us know in the comments! 

The Navistar Retirement Benefits Class Action Lawsuit is Shy, et al. v. Navistar International Corp, et al., Case No. 3:92-cv-00333, in the U.S. District Court for the Southern District of Ohio.

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