To clarify, Yellow has ~$2.1B in assets and ~$2.6B in debts. The Teamsters Union claims Yellow owes the pension fund ~ $6.5 billion (which works out to about $300k for each Teamster who worked at Yellow when it shut down). But the actual numbers here are mostly made up and don't matter.
> The funds asked Goldblatt to rule that billions of dollars in federal grant money they received from the US last year should be ignored when that liability is calculated.
The wording here is unclear. But the grant money mentioned here is the relief provided by the American Rescue Plan - the federal government dumped nearly a trillion dollars in guarantees that all qualifying pensions are going to pay out at 100%. So what the pensions lawyers are are arguing is that it doesn't matter that the pension is funded or not, they still have a senior claim on the debt.
> The Pension Benefit Guaranty Corp., which regulates retirements funds like those set up for Yellow’s union workers, argued that other companies with traditional pension plans would have an incentive to cancel their retirement benefits if Yellow won since shareholders wouldnt be forced to pay a hefty penalty.
More specifically, if every company made the same argument, they would all dump their pension funds and now they would all be the government's problem. It would not be a great precedent.
> The funds asked Goldblatt to rule that billions of dollars in federal grant money they received from the US last year should be ignored when that liability is calculated.
The wording here is unclear. But the grant money mentioned here is the relief provided by the American Rescue Plan - the federal government dumped nearly a trillion dollars in guarantees that all qualifying pensions are going to pay out at 100%. So what the pensions lawyers are are arguing is that it doesn't matter that the pension is funded or not, they still have a senior claim on the debt.
> The Pension Benefit Guaranty Corp., which regulates retirements funds like those set up for Yellow’s union workers, argued that other companies with traditional pension plans would have an incentive to cancel their retirement benefits if Yellow won since shareholders wouldnt be forced to pay a hefty penalty.
More specifically, if every company made the same argument, they would all dump their pension funds and now they would all be the government's problem. It would not be a great precedent.