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July 19, 2001
Xerox Facing $300M Pension Ruling
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ederal judge has ruled that the Xerox Corp.'s pension plan is flawed, and that may lead to an order for the Stamford, Conn.-based company to pay as much as $300 million to retired workers, the Wall Street Journal reported in its online edition on Wednesday.

The newspaper, citing lawyers for former employees as sources, said Judge David R. Herndon of the U.S. District Court for the Southern District of Illinois ruled on July 3 that Xerox incorrectly calculated "lump sum" retirement payments given to departing employees.

The miscalculation resulted in lower payments than the workers were due under federal pension-benefits rules.

The judge, who is expected to issue a formal ruling within a few weeks, is unlikely to specify damages in the class-action case for several months, said Douglas Sprong, one of three lawyers representing the former employees.

But Sprong told the Journal that most Xerox retirees choose lump-sum compensation, and he estimated the court would ask Xerox to pay the retirees between $100 million and $300 million.

Lawyers for the employees say their case covers at least 25,000 former Xerox workers who elected to receive their pension benefits in a single payment rather than monthly checks, the newspaper said.

Click here to view a Reuters story.
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