Law firm Butzel Long seeks help from federal agency to pay underfunded pensions
Butzel Long PC, a Michigan-based law firm with an office in Ann Arbor, has asked a federal agency to save its pension plan that is underfunded by more than $9 million according to a report from MLive.
Rather than using tax revenues, the agency, the Pension Benefit Guaranty Corp. (PBGC), is funded by insurance premiums paid by sponsors of defined benefit plans. The PBCG paid about $384 million to Michigan retirees in failed pension plans in 2011.
According to MLive statewide business reporter Melissa Anders, the firm regularly represents clients before the PBGC and also represents the Michigan Press Association, of which MLive Media Group is a member.
Unlike other companies requesting pension relief, Butzel Long is not facing bankruptcy. The company has changed its benefits package to include a defined-contribution 401(k) plan instead of the pensions.
Ben Freed covers business for AnnArbor.com. You can sign up here to receive Business Review updates every week. Reach out to Ben at 734-623-2528 or email him at benfreed@annarbor.com. Follow him on twitter @BFreedinA2
Comments
snapshot
Sat, Feb 2, 2013 : 3:03 a.m.
the PBGC better tell these guys to take a hike. Law firms don not have the standard pension plans that normal folks do. they depend upon current income to fund retired partner "agreements" not pensions. Now that attorney's are suffering from economic changes made by corporations they want to dip into the taxpayer funds? Bull Hooyey go back to work like the rest of us.
trespass
Fri, Feb 1, 2013 : 12:19 p.m.
This is lazy reporting. It is essentially just restating the press release from the company rather than fact checking. The article gives the impression that the money will not come from the taxpayers but since the fund already does not have enough money to cover its obligations and it is backed by the "full faith and credit" of the US government, we will almost certainly pay this bill.
PineyWoodsGuy
Fri, Feb 1, 2013 : 6:43 a.m.
Obama is Smart to bail-out this swarm of lawyers. They are Very Well politically connected. Managing Partner Klimko is quoted on M-Live: "That's the name of the game in our business." Since When has the practice of law been a "business," rather than a "profession"? And why the sports vernacular "The name of the game."? Yins made yer bed; now sleep in it! Links: http://www.mlive.com/business/index.ssf/2013/01/michigan-based_law_firm_seeks.html#incart_river_default and http://www.butzel.com
GoNavy
Fri, Feb 1, 2013 : 3:45 a.m.
NO. WAY. Get the partners to cough up the money. Don't ask me to contribute a dime. The PBGC is already underfunded to the tune of $20+ billion.
ArthGuinness
Fri, Feb 1, 2013 : 3:43 a.m.
It's not clear to me whether Butzel Long paid into that plan. I would assume so, if they qualify for a payout. If so, who cares? It's not tax dollars so it's purely between them and the agency. It seems irrelevant that it's a federal agency.
JimmyD
Fri, Feb 1, 2013 : 2:44 p.m.
A/G: the Agency in question is an insurance commission to protect retirees in case their pension fund fails. it's not a piggy-bank to pull funds from in case your firm decides it would rather pay bonuses to the partners. we all pay into that Agency if we have pensions. Unless the Firm goes bankrupt and wipes out the primary assets they shouldn't get to draw from this fund.
BenWoodruff
Fri, Feb 1, 2013 : 3:17 a.m.
Yeah...Butzel Long. They do labor law, and work against unions. I'm sure the anti-union posters love them...but I found this from their website in "Experience"... "Assisted tier one automotive supplier in structuring plant closing benefits for union employees; analyzed legal issues on providing pension accruals post-plant closing and advice on benefit funding, vesting and reporting and disclosure obligations" "Restructured 16 retiree health care programs for major manufacturing company into five consolidated programs with reduced benefits and assisted with retiree communication and acceptance program" Maybe what should happen instead on PBGC assistance is "closing benefits" and restructuring with "reduced benefits". I mean, if its good for their clients, it should be good for them, right?
Linda Peck
Fri, Feb 1, 2013 : 1:55 a.m.
No, say it isn't so! This is all some kind of joke.
LXIX
Fri, Feb 1, 2013 : 1:29 a.m.
Excellent ! 460 experienced pro bonos for Ann Arbor's Michigan Legal Aid office. Probably could use some more of those empty public houses downtown, too.
An Arborigine
Fri, Feb 1, 2013 : 1:18 a.m.
I'm thinking some of their already-wealthy partners may have made off with pension funds. Those seeking Federal aid may be the targets of prosecution?
DJB
Fri, Feb 1, 2013 : 12:48 a.m.
This should not be considered a failed pension plan without a bankruptcy.
Fresh Start
Fri, Feb 1, 2013 : 12:41 a.m.
We gave free handouts to banks and insurance companies five years ago. We're $16,000,0000,000,000.00+ in debt, and NOW; Here come the lawyers!!!!....Pfft
jcj
Fri, Feb 1, 2013 : 1:41 p.m.
Thanks Festus.
PineyWoodsGuy
Thu, Jan 31, 2013 : 11:36 p.m.
People do not "feel sorry" for lawyers that drive foreign-made Bimmers and Benzs. I could understand a local unit of govt getting insolvent; it is run my people who have learned how to get elected. However, I find it Very, Very, Very Difficult to believe that a group of lawyers, with a higher education that takes 7 years and with Razor-Sharp training in the Law would have the Nerve to ask for a Bail-Out. Why not just close the office and chalk it up to not being very good lawyers . . .
Tom Todd
Fri, Feb 1, 2013 : 6:22 a.m.
Rich folks get bailed out i.e tarp/banks got what 800 Million but people cry when GM got some dough to help out middle class folks these dudes will get what they want
Angry Moderate
Fri, Feb 1, 2013 : 1:07 a.m.
"Bimmers and Benzs"? A regional law firm is Michigan is not what you see on TV shows. Also, this is not a bailout, they're calling in an insurance policy that they've been paying the premiums for all along. Do you consider it a bailout when your health insurance company pays your medical bills?
Michigan Reader
Thu, Jan 31, 2013 : 11:50 p.m.
I think it's the economy. Many businesses are demanding cheaper legal fees from law firms since the recession was at its depth. Maybe even before.
Dog Guy
Thu, Jan 31, 2013 : 10:39 p.m.
Where do I send a donation for these lawyers facing a reduced pension? Will there be a bake sale? Oh, excuse me, the firm has asked a federal agency to save its pension plan that is underfunded by more than $9 million" so my donation will be automatic.
trespass
Fri, Feb 1, 2013 : 12:12 p.m.
@Alan- The agency is guaranteed by the "full faith and credit" of the US government. When it goes bankrupt it is the taxpayers that will foot the bill. With the number of companies that have abandoned their underfunded pensions, it will almost certainly go bankrupt.
alan
Thu, Jan 31, 2013 : 10:51 p.m.
I assume that you didn't read the article. "Rather than using tax revenues, the agency, the Pension Benefit Guaranty Corp. (PBGC), is funded by insurance premiums paid by sponsors of defined benefit plans."