Delphi Corp. Securities, Derivative and ERISA Litigation
The Delphi ERISA Consolidated Complaint was filed in the United States District Court for the Eastern District of Michigan on behalf of Plaintiffs and a class (the “Class”) of all persons who were participants in or beneficiaries of the following Delphi-sponsored, defined-contribution plans (collectively “the Plans”): (1) the Delphi Savings-Stock Purchase Program for Salaried Employees in the United States; (2) the Delphi Personal Savings Plan for Hourly-Rate Employees in the United States; (3) the ASEC Manufacturing Savings Plan; and (4) the Delphi Mechatronic Systems Savings-Stock Purchase Program from May 28, 1999 to November 1, 2005 (the “Class Period”) and whose accounts included investments in Delphi or General Motors (“GM”) common stock.
Plaintiffs allege that during the Class Period, the Defendants breached their fiduciary duties to Plaintiffs and the Class members by:
- failing to prudently and loyally manage the Plans’ assets
- failing to act in accordance with Plan documents and ERISA
- failing to monitor fiduciaries
- failing to disclose to and inform the other fiduciaries of the Plans of information which the other fiduciaries reasonably needed to know to fulfill their fiduciary duties to Plan participants and beneficiaries
- and breaching their obligations as co-fiduciaries.
On July 10, 2009, the parties to the Amended Stipulation entered into a Settlement Modification, which amended the Settlement as follows: First, substantial consummation of Delphi’s Plan of Reorganization is eliminated as a condition to the Effective Date of the Settlement. Rather, the Settlement would become effective upon the Court’s and the Bankruptcy Court’s approvals of the Settlement Modification (and the corresponding modification to the Securities settlement) becoming Final. Second, the Class’s Allowed Equity Interest would no longer be entitled to the same treatment as unsecured claims in the Delphi bankruptcy, unless unsecured claims receive full payment plus interest.
The Bankruptcy Court approved the Modification in July 2009 and on November 16, 2009, the Court granted final approval of the ERISA Settlement Modification.