John Hancock Mutual Life
Insurance Co. doesn’t have to pay $85 million in a 19-year-old
lawsuit over how it handled pension plan assets, a U.S. appeals
court ruled in vacating the damage award.
The U.S. 2nd Circuit Court of Appeals ruled that the $85
million judgment won by a Sperry Corp. employee pension fund in
2000 was too high. U.S. District Judge Denny Chin must hold new
hearings on the damages John Hancock should pay, a three-judge
panel ruled.
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The appeals panel said John Hancock violated its fiduciary
duty under the federal Employee Retirement Income Security Act
(ERISA) of 1974 in some ways, although not others. The suit was
filed in 1983 and went to the U.S. Supreme Court 10 years later.
This latest ruling, handed down on Tuesday, is a “mixed bag,”
said the pension fund’s attorney, Lawrence Kill.
“It means that the damages are reduced but no one has done
the calculations yet on what they are,” Kill said. “It will be
remanded back to the court for further factual findings.”
In a filing today with the Securities and Exchange
Commission, the insurer’s parent, Boston-based John Hancock
Financial Services Inc., said the matter remains in litigation and
no final judgment has been entered.
The case involves pension funds invested for workers at
Sperry, which merged in 1986 with Burroughs Corp. to form Unisys
Corp.
Bloomberg News
