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Court gives final approval to settlement reached in retiree class actions against Akron Beacon Journal and its foreign owner

Tuesday, November 13, 2012

Retirees will receive benefits better than originally promised, as well as reimbursement for excess medical and prescription-drug expenses

AKRON, OHIO - An Akron federal judge on Friday gave his blessing to a global settlement reached in two class-action lawsuits filed against the Akron Beacon Journal, as well as its foreign owners and certain officers, on behalf of newspaper retirees and their spouses. The retirees, members of the Communication Workers of America (CWA) Local 14514 and Northeast Ohio Newspaper Guild, Local 1, had sued their former employer for breach of promises to provide lifetime prescription-drug benefits, with co-pays ranging from $2 to $5, in return for their early retirement. Many of them had also been promised lifetime medical-insurance benefits.

Friday's final approval means that these retirees will once again receive the benefit of their bargains. The settlement restores, and in many cases actually expands, the healthcare and prescription-drug benefits promised to class members when they retired. Class members eligible for medical coverage, for instance, will pay nothing for most Medicare-eligible services after meeting a low annual deductible. And no class member will pay more than $2 or $5 (depending on his or her year of retirement) for any generic or name-brand prescription drug. Class members who do not want or need the new coverage have the option of electing a lump-sum cash payment. The settlement also establishes a $100,000 fund that will be used to reimburse the retirees and their spouses for excess amounts that they spent over the past few years for medical care and prescription drugs.

Attorney Subodh Chandra, one of four attorneys representing the retirees, hailed the judge's decision. "While it was a long road to this result, I am delighted that theBeacon Journal has re-committed to the retirees who served it so well for so long. And the judge obviously saw the wisdom of a settlement that restores the benefits class members expected when they retired."

Chandra also noted that the settlement ensures that the retirees and their spouses will, for the rest of their lives, receive benefits that are even better and less expensive for the retirees than what they could have been awarded had they proceeded to trial and won. For example, many retirees will, for the first time in many years, begin to receive "major medical" insurance benefits again, even though the early-retirement bargain they struck with theBeacon Journal provided that such benefits would terminate at age 65. The prescription-drug plans being offered to the retirees, moreover, provide more comprehensive coverage than did the plans in effect when most class members retired. The judge's approval also means that the attorneys for the class will receive an agreed-upon amount of attorneys' fees and costs.

The cases, both of which were pending before U.S. District Judge David Dowd, were captioned White v. Beacon Journal Publishing Co., et al. and Olesky v. Beacon Journal Publishing Co. (For more details regarding the settlement, please contact The Chandra Law Firm, LLC.)

In addition to Chandra, the retirees were represented by Donald Screen, also of the Chandra Law Firm, LLC in Cleveland, Ohio, and by Allen Anderson and Kenneth Petterson of Smith & Johnson in Traverse City, Michigan.

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