Opinion
Case No. 02-13533 (AJG) (Jointly Administered)
December 26, 2002
Marcia L. Goldstein, Esq. (MG 2606), Lori R. Fife, Esq. (LF 2839), WEIL, GOTSHAL MANGES, New York, NY, Alfredo R. Perez, Esq., WEIL, GOTSHAL MANGES, Houston, TX, for PENSION BENEFIT GUARANTY CORPORATION.
JEAN MARIE BREEN, ESQ. (JB2943), Attorney, Office of the General Counsel.
STIPULATION AND ORDER ALLOWING PENSION BENEFIT GUARANTY CORPORATION TO FILE CONSOLIDATED CLAIMS UNDER ONE CASE NUMBER
Pension Benefit Guaranty Corporation ("PBGC") and each of the above-captioned debtors and debtors-in-possession, by and through their attorneys, agree that: PBGC will be permitted to file consolidated proofs of claim in the above-captioned jointly-administered cases under only the case caption of the lead case, In re WorldCom, Inc., on the terms and subject to the conditions set forth below:
Background
1. WorldCom, Inc. ("WorldCom") and 221 of its direct and indirect subsidiaries (collectively the "Debtors") filed voluntary petitions under Chapter 11 of the Bankruptcy Code, on July 21, 2002 and November 8, 2002.
2. By orders dated July 22, 2002 and November 12, 2002, this Court procedurally consolidated the Debtors' Chapter 11 cases, Case Nos. 02-13532(AJG) through 13533(AJG), 02-42154(ALG) through 42330(AJG), and 02-43305(ALG) through 43347(AJG), and ordered joint administration of them under In re WorldCom, Inc., Case No. 02-13533(AJG).
3. PBGC is the wholly-owned United States government corporation that administers the defined benefit pension plan termination insurance program under Title IV of the Employee Retirement Income Security Act of 1974, as amended, 29 U.S.C. § 1301-1461 ("ERISA"). The Debtors sponsor at least two defined benefit pension plans (the "Pension Plans") that are covered by the Title IV termination insurance program.
4. Each of the Debtors is either a contributing sponsor of one of the Pension Plans or a member of the contributing sponsor's controlled group. See 29 U.S.C. § 1301(a)(13) and (14).
5. PBGC believes that it must file at least three separate claims regarding each Pension Plan for: (1) unpaid minimum funding contributions required under 26 U.S.C. § 412; (2) unpaid premiums owed to PBGC under 29 U.S.C. § 1307; and (3) contingent termination liability to PBGC under 29 U.S.C. § 1362. In these cases, PBGC intends to assert each claim, on behalf of itself or on behalf of a Pension Plan, against each and every one of the Debtors for joint and several liability as provided by 29 U.S.C. § 1307 and 1362.
6. If PBGC separately files three proofs of claim for each of the two Pension Plans against each of the 222 Debtors, the total number of claims filed by PBGC would be over 1000. The filing of this many separate claims would impose an undue administrative burden on the Debtors, PBGC, the Court and the Debtors' claims agent.
Agreement
7. Notwithstanding anything to the contrary set forth in the Bar Date Order or elsewhere that would otherwise require PBGC to file separate proofs of claim against each of the Debtors, the Debtors and PBGC expressly agree that the filing of a proof of claim or proofs of claim by PBGC in Case No. 02-13533(ALG) on its own behalf or on behalf of the Pension Plans shall be deemed to constitute the filing of such proof of claim or proofs of claim in all of the cases jointly-administered under In re WorldCom, Inc., Case No. 02-13533 identified by PBGC. Consequently, each claim PBGC files in the lead case shall represent a claim asserted against each of the Debtors identified by PBGC.
8. This Stipulation is intended solely for the purpose of administrative convenience. This agreement shall not be deemed to constitute an agreement or admission as to the allowance or validity of any claims and shall not affect the substantive rights of any of the Debtors, PBGC or any party in interest with respect to the timeliness, liability, allowance, amount or priority of the PBGC's claims or with respect to any objections, rights, defenses, offsets or counterclaims of any of the Debtors or any other party in interest related to PBGC's claims. The Debtors hereby specifically reserve all of their rights to object to any proofs of claim filed by PBGC ("PBGC's claims" in whole or in part on any basis, including without limitation, any or all of the respective amounts of the claims asserted by PBGC. PBGC hereby specifically reserves all of its rights in whole or in part on any basis with respect to any objections, rights, defenses, offsets or counterclaims of any of the Debtors or any other party in interest related to PBGC's claims, including without limitation, any or all of the respective validity or amounts of PBGC's claims.
9. Unless otherwise ordered by the Court, the Debtors and PBGC expressly agree that this Stipulation and Order shall also apply to any amended proofs of claim that PBGC may file with respect to the Pension Plans.
10. The Court shall retain jurisdiction over all matters or disputes under this Stipulation and Order.
11. This Stipulation and Order shall be of no force or effect unless and until it is entered by the Court.
SO ORDERED this 26th day of December, 2002