A U.S. District Court has approved a $9.5 million class-action settlement of a decade-long dispute between former members of Owens-Illinois defined benefit plan and the Ohio-based global manufacturer of glass containers.

Sessions et al v. Owens-Illinois arose from the company's sale of its Owens-Brockway Plastic Products Group unit in 2004.

On Jan. 1, 2000, Owens-Illinois amended its defined benefit plan to include an Enhanced Retirement Benefit for participants who became “terminated retirees” resulting from layoffs.

The enhanced benefit entitled eligible participants to receive between 70 and 100 percent of their pension benefits if their position was terminated.

Upon the completion of the 2004 sale of its Plastic Products Group, Owens-Illinois informed employees their jobs would be protected subsequent to the sale of the unit, and that they would not be eligible for the enhanced retirement benefit if they did not accept a “comparable” offer with their new employer.

A claim was brought in the Middle District of Pennsylvania court in 2007, and the class was ultimately certified in 2010.

Owens-Illinois claimed the plaintiffs were not eligible for the enhanced retirement benefits, primarily because they each received a “comparable offer of employment” from Graham Packaging, the acquiring company.

But the plaintiffs, a class of 100 former employees, claimed Owens-Illinois was deceptive in its communication to employees affected by the sale, and that no guarantee of “comparable” employment had been made by Graham Packaging.

Some of the affected employees were offered positions with Graham, but at different locations, according to court documents.

Plaintiffs also alleged that some employees were offered “sham” positions that were then eliminated, according to their complaint.

Graham also did not grant service credit to O-I employees, did not allow them to take early retirement until age 62, did not provide an Enhanced Retirement Benefit when Graham terminated its defined benefit plan in 2006, and did not offer a lump-sum option to retirees or retiree health care benefits.

Ultimately, a court-appointed mediator was assigned to settlement negotiations, the terms of which were accepted by U.S. District Court Judge Robert D. Mariani.

Instant Insights /

Owens-Illinois settles with former members of DB plan

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