WINNIPEG – Manitoba Telecom Services Inc. (MTS) announced this past Friday that the Manitoba Court of Appeal has ruled in its favour, ending a 13-year-old battle between MTS Allstream pensioners and the company around the disposition of a $43-million pension surplus that existed when the company was sold to the public in an equity offering in 1997.
MTS appealed the original court decision made back on January 19, 2010 based on external legal advice that key aspects of the decision were flawed and presented strong grounds for appeal. At the time the Court of Queen's Bench Justice Donald Bryk ruled the company must make a $43-million payment into the pension and pay interest dating back to 1997, which would have made it one of the highest judgment amounts ever awarded by a Manitoba Court.
Today the Court of Appeal has ruled against the plaintiffs and for MTS and has dismissed all cross-appeals raised by the plaintiffs. The decision of the trial judge that the company may be required to pay additional funds estimated previously of up to $100 million was set aside. As a result, MTS says there will be no change to the company's expected future funding requirements, or any other aspects of the MTS pension plan.
"We are pleased that this issue is now resolved, as the judgment affirms what we have said over the past number of years. We look forward to putting this behind us," said Pierre Blouin, MTS Allstream's Chief Executive Officer in a statement. "We regret that this process has taken over a decade to resolve and has been very costly for ourselves, our retirees and our unions. Nevertheless, MTS pension plans have always been, and continue to, remain strong."
Over the years MTS maintains it remained committed to funding this plan, and contributed and made commitments of approximately $540 million to the pension plan, over $400 million of which has already been paid in cash. Employee contributions over the same period totaled $144 million.
A copy of the of the Court's decision is available on MTS Allstream's web site.
