Updated with correction
The U.S. Supreme Court on Monday declined to review an appellate court ruling in a case brought against the Pension Benefit Guaranty Corp. by Delta Air Lines Inc. pilots seeking $600 million in investment returns.
The U.S. Court of Appeals for the District of Columbia Circuit ruled Dec. 21 in favor of the PBGC in a case brought by retired Delta pilots, who argued that the agency underestimated their benefits.
After Delta filed for bankruptcy in 2005, the Delta Air Lines Pilots Retirement Plan was terminated and the PBGC became trustee in December 2006. At the time, the plan's assets were valued at $1.99 billion, court filings said.
The PBGC gained some assets in a settlement agreement with Delta and later recovered additional assets valued at $1.28 million, which the retired pilots allege in the lawsuit should have been shared with them, instead of being kept by the PBGC. The plaintiffs, representing many of the 1,784 plan participants who disagreed with the PBGC over their benefit levels, are claiming the agency earned "massive investment returns" off the recovered assets, instead of sharing some returns with participants, which they argue constitutes a fiduciary breach. The lawsuit was filed in December 2014 after the PBGC's internal benefit determination and appeals process had been exhausted.
The Supreme Court denied the petition for review in Lewis et al. vs. Pension Benefit Guaranty Corp. without comment.