Volume 22, Issue 1 Summer, 2019

OCTOBER 15, 2018— DECLARES BANKRUPTCY MARCH 15, 2019— SEARS CANCELS RETIREES LIFE INSURANCE MAY 29, 2019— RETIREES SEEK BANKRUPTCY COURT ASSISTANCE

As disclosed in the winter issue of Straight Talk, last executive officer of the company. However, he remains October Sears Holdings filed for debt relief under Chap- chairman of the board. ter 11 of the Bankruptcy Code in the U.S. Bankruptcy The company’s board created an Office of the CEO, Court for the Southern District of New York. which will be responsible for managing the company’s As part of the actions taken by the company on Oc- day-to-day operations during the bankruptcy process. tober 15, 2018, stepped down as chief This Office of the CEO is composed of Robert A. Riecker, chief financial officer; Leena Munjal, chief digital officer, customer experience and integrated retail; and Greg- ory Ladley, president of apparel and footwear.

Lampert, ever the optimist, is bet- ting on Sears’s survival. At an continued on page 2

This issue of STRAIGHT TALK: Bankruptcy, Cancellation & Court Assistance p. 1 Labor Department Puzzled p. 4 Lawmakers & Mnuchin p. 5 Retirees Fight Termination p. 6 Sears Atlanta Retiree Club p. 7 Sears Sues Eddie Lampert p. 8 Lampert Has New Opponents p. 9 Chairman’s Page p. 10 Sears Holdings Targets Retirees p. 12 Sears Corporate Headquarters

—STRAIGHT TALK Summer 2019— 1 Bankruptcy continued from page 1 employee gath- ward “to serving our members … just as we have for ering at Sears’s headquarters after the bankruptcy was the past 125 years.” announced, he told employees, “I don’t view (the actions Retirees worked long and hard during their careers taken today) as a funeral, but as a new beginning.” with Sears to build the company into the successful Sears Cancels Retirees’ Life Insurance general merchandiser it once was. As a result of this It was not a “new beginning” for Sears’s retirees on promised benefit, many retirees cancelled their other March 15, 2019, when the company sent a letter dated life insurance and trusted that Sears would honor March 15 that Sears Holdings, now known as Trans- its commitment for retiree life insurance. They knew form Holdco LLC, announced that it “will no longer that as long as Sears did not liquidate, that their life provide life insurance benefits for retirees … Your insurance would be secure. group benefit terminated March 15, 2019. This let- Now, this trust in a company that retirees worked ter was not signed by an individual, but only by for has been shattered by both the newly created “Sears Holdings Corporation.” Office of the CEO and by the man who lives in Transform Holdco LLC is an American a $40 million Miami mansion, and who privately held company formed to acquire purchased all of Sears’s assets for billions Sears Holdings Corporation assets. The of dollars. new company is owned by Eddie Lampert. However, the company was not totally Following the bankruptcy of Sears Hold- heartless. In the notice of cancellation, ings, Transform Holdco LLC purchased Sears Holdings informed retirees that, substantially all of the assets owned by “We recognize that this situation impacts Sears Holdings for $5.2 billion. you and your family.” To the best of our knowledge, no re- However, the company offered retirees tiree received the cancellation notice Robert A. Rieker, the option to convert all or a portion until three to seven days after the chief financial officer of the amount of their group insur- March 15 cancellation! ance coverage that was previously Since March 15 N.A.R.S.E. paid for by Sears (not to ex- has been deluged with fran- ceed $10,000) into a whole tic phone calls, letters and life policy. emails from retirees as a When asked, N.A.R.S.E. result of this devastating has told our retirees not to decision by Sears to cancel accept the option of conver- the retiree life insurance. sion. The Securian Life This heartless decision Insurance premiums by Sears Holdings has are totally unrealistic caused a financial and noncompetitive and emotional stress Leena Munjal, Gregory Ladley, in today’s insur- on our retirees and chief digital officer, president of apparel ance marketplace. their families. customer experience & footwear & integrated retail As an example, an What was a prom- 80-year-old Sears ised benefit for Office of the CEO retiree from Sears’s retirees Wenatchee, for decades turned into a financial nightmare for many. Washington, told us that for a $10,000 whole life con- The average age of the retiree population affected by version insurance policy from Securian it would cost the elimination of the retiree life insurance is 80, with him $1,456.90 per quarter or only $5,827.60 per year!! some in their 90s. In contrast, a New York Life Insurance Company Ironically, in a January 17, 2019, letter to retirees, policy for an 80-year-old male continued on page 3 Sears Holdings thanked retirees for their “dedicated service” and said that the company was looking for- —STRAIGHT TALK Summer 2019— 2 Bankruptcy continued from page 2 w o u l d c o s t Bankruptcy Court, Southern District of New York, $120.22 per month or $1,358.60 per year. directing the appointment of a committee of retired employees. These retirees are just two of tens of thou- N.A.R.S.E. has heard from many retirees who could not be- sands of retirees of Sears Roebuck who are entitled to lieve that the company would actually abandon its retirees. a life insurance benefit under a benefit plan that had Historical Update for Sears Holdings been in place for decades. Evidently our former company is either unaware of, As the Bankruptcy Code authorizes retirees to inter- or has ignored the retiree life insurance class action vene and protect their benefits and also permits the lawsuit settlement agreement dating back to 2001. appointment of a committee of retirees to represent As background, then chairman Arthur Martinez in 1997 them, the retirees in this motion requests that the announced that retiree life insurance benefits would Court direct the appointment of a committee to advo- be cut back for all participants who retired after Janu- cate for the thousands of retirees unjustly and illegally ary 1, 1978, at the rate of 10 percent per year on each losing their benefits. retiree’s life insurance amount in excess of $5,000. At As the motion states, the retirees need a committee to the end of 10 years, each retiree would have a $5,000 protect their life insurance benefits because Sears has life insurance policy, regardless of the original amount. unilaterally terminated the retirees’s life insurance In some cases, the original amount was $100,000. benefits without involving the Bankruptcy Court or As a result of this drastic cut-back of the employees’s meeting the other legal requirements. promised life insurance, that was earned by employ- This retiree committee should be formed because ees’s contributions and years of dedicated service, a Sears states they “do not currently have information number of lawsuits were filed against Sears by retirees with respect to the identities of the retirees that were who alleged they had been promised “free” or “paid-up” covered by the” 2002 Settlement Agreement. The re- life insurance for the rest of their lives. tiree committee, with the assistance of N.A.R.S.E., All lawsuits were eventually consolidated in the United can provide information with respect to the identities States District Court for the Northern District of Il- of the members of the class who were covered by the linois and assigned to Judge James B. Moran. Stipulation of Settlement.

The case was finally settled during the fall of 2001. Retiree’s Motion Under the terms of the settlement agreement, “Sears has stated its clear intention to ignore its ob- the last year of the 10-year reductions would not ligations to the retirees,” states the motion to form a be implemented and the final insurance amount committee. “The retirees request that the court direct would be the minimum $5,000 stipulated and the appointment of a committee to advocate for the agreed to by Sears plus the amount of the final thousands of retirees unjustly and illegally losing year of reduction that was not to be implemented. their benefits.

This retiree life insurance can only be cancelled if In addition, the U.S. Department of Labor objected Sears liquidates and goes out of business. Sears can- to Sears’s plan to end the life insurance without not arbitrarily terminate this insurance as long as the court approval, but Sears responded that it has the company is still in existence. right to “unilaterally amend or terminate the plan at any time.” what sears did on march 15, 2019, went contrary to the 2001 settlement agreement and was also a breach of a “It came as really a shock that they would do that, be- fiduciary relationship with its retirees. This was clearly cause that was the last benefit we had,” saidN.A.R.S.E. a betrayal of trust by the company that Sears’s retirees Chairman, Ron Olbrysh, one of the Sears retirees helped build. asking for the retiree committee.

Motion Filed with Bankruptcy Court “Retirees relied on Sears to adhere to the Stipulation to Appoint a Retiree Committee of Settlement not to further reduce their life insur- Near the end of May, 2019, Ronald Olbrysh and ance, but that turned out to be a mistake when Sears Richard Bruce filed a motion in the United States terminated their policies,” Olbrysh said.

—STRAIGHT TALK Summer 2019— 3 LABOR DEPARTMENT PUZZLED BY SEARS TREATMENT OF RETIREE INSURANCE BENEFITS Government Questions Retailer’s Right to Cancel the Program in Light of a 2001 Settlement with Retirees

U.S. Secretary of Labor Alexander company implemented in 1998 Acosta asked bankrupt retail giant to reduce the payment of retiree Sears Holdings Corp. to explain life insurance premiums in an- contradictions in its pending Chap- nual increments. The settlement ter 11 plan regarding the treatment stipulation covered a class of ap- of retiree benefits for some 80,000 proximately 80,000 retirees. former employees. (Sears notes) in their bankruptcy Before Sears Holdings can so- plan documentation that the re- licit creditor votes on its plan to tiree plans affected by the March dissolve in Chapter 11 and put termination covered approximately its assets in a liquidating trust, 32,000 former employees. the company needs to reconcile Acosta said Sears Holdings needs confusing statements about how to address his department’s ques- it intends to treat a legacy re- tions before circulating the plan tiree life insurance plan, lawyers to creditors, and advocated for the for Acosta said in an objection. U.S. Secretary of Labor appointment of a committee in the The secretary’s filing points to a set Alexander Acosta Chapter 11 case to protect the in- of paragraphs in Sears’s disclosure terests of Sears’s retirees. statement that informs creditors the disclosure statement’s esti- Sears entered bankruptcy in Octo- that the company’s board approved mate of administrative expenses?” ber to reshape its physical footprint the termination of the retiree plan he asked. and reduce a debt load of more in March, with legal authority to For their part, lawyers for Sears than $11 billion created by years do so in the event of a corporate Holdings stated in the disclosure of losses, store closings and un- reorganization, but then states that statement filed last month that they successful efforts to adapt to a Sears Roebuck entered into a legal became aware of the 2001 settle- changing retail world. settlement in 2001 agreeing not to ment stipulation after the March reduce or terminate the applicable The plan at issue provides creditor termination and have not been able retiree coverage. recoveries stemming in large part to identify any such amendment to from a $5.2 billion sale of the com- “(Sears has) failed to disclose in the applicable plan. They also don’t pany to the owned by the disclosure statement what they have information with respect to former Sears CEO Eddie Lampert intend to do in light of this conflict,” retirees covered by the stipulation, and proceeds from causes of action Acosta said, asking if the Sears they said …. preserved on behalf of the estate …. estate intends to restore the ben- A representative for Sears Holdings The case is In re: Sears Holding efits. He also urged the company to did not immediately respond to a Corp., case number 7:18-bk-23538, explain how it will satisfy pension request for comment …. in the U.S. Bankruptcy Court for obligations that must carry through the Southern District of New York. in a Chapter 11 plan. The issue identified by the secre- tary’s office refers to a settlement —Reported by Alex Wolf, Law 360, “Consequently, will the amount of reached in Illinois federal court May 10, 2019. Additional reporting claims by vested retirees under the by Sears to resolve a class action by Rick Archer. Editing by Alan- Retiree Life Insurance Plan alter suit that challenged a decision the na Weissman.

—STRAIGHT TALK Summer 2019— 4 Elizabeth Warren, Alexandria Ocasio-Cortez, Steven Mnuchin, secretary Democratic Senator, Mass. Democratic Representative, N.Y., U.S. Department of the Treasury LAWMAKERS PRESS MNUCHIN OVER SEARS ROLE

Sen. Elizabeth Warren, D-Mass., Warren also has a personal connec- and what advice he gave his former and Rep. Alexandria Ocasio-Cortez, tion to Sears. After her father died, college roommate about selling off D-N.Y., are calling on U.S. Treasury to keep the family afloat her mother or shutting stores and laying off Secretary Steven Mnuchin to be got a job as a phone operator in the thousands of workers. more transparent about his time on catalog department at a Sears store Both Warren and Ocasio-Cortez have Sea rs’s boa rd as the reta iler plunged in Oklahoma. been critics of predatory corporate into bankruptcy. They also take “We are deeply concerned by the practices that have resulted in thou- issue with his possible oversight financial engineering and po- sands of workers losing their jobs of the company’s pension plans. tentially illegal activity that took while enriching the people at the top. Before joining the Trump admin- place at Sears Holding Corporation And Finally istration, Mnuchin served on the while you served on the company’s Mnuchin was one of several former boa rd of Sea rs Holdings Cor p. a nd is board,” the congresswomen wrote in board members named in a lawsuit a close friend and ex-Yale roommate a letter to Mnuchin …. “In addition, (filed in April), in which Sears Hold- of Eddie Lampert who has been ac- we are concerned that, as Treasury ings company accused its former cused of making billions for himself Secretary, you are in position to chairman, Eddie Lampert, and oth- and while closing 3,500 take actions that benefit Sears’s ers of siphoning billions of dollars stores and firing 20,000 workers. shareholders and owners at the from the company as they closed expense of workers and taxpayers.” What the Lawmakers Say stores and shed staff. “Eddie Lampert put his friend Ste- Questions for Mnuchin The lawsuit further alleged that, ven Mnuchin on the Sears board With the above in mind, Warren “In an effort to create a false record and then he drove the company into and Ocasio-Cortez posed several to cover up their asset stripping, the ground,” Ocasio-Cortez said in questions to Mnuchin and gave at Lampert’s personal direction, a video posted on Twitter. him a June 13 deadline to respond. Sears’s employees repeatedly pro- And Warren said of Lampert, “In- Among other things, they asked duced financial plans reflecting stead of investing in the company, Mnuchin what advice he gave when fanciful, bad-faith predictions that he sucked about $6 billion in value Lampert decided to buy back al- the company would experience an of it and then did stock buy backs, most $6 billion in Sears stock; what immediate continued on page 6 which certainly made him a lot advice he gave Eddie about loading of money.” Sears “with large amounts of debt,”; —STRAIGHT TALK Summer 2019— 5 Mnuchin continued from page 5 and subsequently handed over plans, which were underfunded by and dramatic turn-around from responsibility of its two pension about $1.4 billion, affect more than deep and mounting losses to sud- plans to the Pension Benefit Guar- 90,000 Sears’s workers. den profitability.” anty Corp., which is overseen by This article reflects news reports Mnuchin, as well as the secretaries As we all know, Sears Holdings from Post 24x7 and Corky Siemasko, of commerce and labor. The pension filed for bankruptcy last October senior writer at NBC News Digital. SEARS’S RETIREES GO TO COURT OVER LIFE INSURANCE TERMINATION

Lawyers for retired Sears’s workers say the bankrupt retailer has wrongly terminated the life insurance policies for tens of thousands of former employees.

A group of retired Sears Hold- N.A.R.S.E. can assist the Court in membership this year when the life ings Corp. workers has asked for addressing is how to identify those insurance policies were terminated. the creation of a committee to beneficiaries of deceased retirees, “As a result of the life insurance protect their interests, claiming and the filing of their administra- cancellation, Olbrysh received the spouses of some retirees who tive claims for payment in light of an average of 20 phone calls per recently died were deprived of life Sears Holdings’s actions to termi- day from retirees,” according to a insurance payments earned from nate vested retiree life insurance court filing. years of work at the once iconic without the Court’s approval. Lampert Sues department store. Sears filed for bankruptcy last year The fight over life insurance comes Lawyers for the retired work- and sold its assets in January. The amid a number of other conflicts in ers say the bankrupt retailer shell of the business that is now the bankruptcy. Eddie Lampert, ex- has wrongly terminated the life winding down with a plan to pay Sears chief executive and founder of insurance policies for tens of thou- creditors said in an April court the investment firm that bought the sands of former employees. In filing that it had stopped making company’s assets, sued the estate one instance, the life insurance premium payments and had termi- for failing to deliver “hundreds of policy of a Sears retiree who died nated the retiree plan. millions of dollars of assets” in ac- May 6 won’t be paid because his cordance with the sales agreement. The U.S. Department of Labor ob- death was 21 days after the Sears jected this month to the plan to end Lampert says that the estate’s estate terminated his benefits, ac- the life insurance without court ap- failure to deliver assets means he cording to a recent court filing. proval, but Sears responded that it shouldn’t have to pay $43 million Motion for a Retiree Committee has the right to “unilaterally amend in severance payments to workers In a recent motion in the Bankrupt- or terminate the plan at any time.” who lost their jobs. Representatives cy Court to form a retiree committee, of his firm, ESL Investments, didn’t “It came as really a shock that they “Sears has stated its clear inten- immediately respond to a request would do that, because that was the tion to ignore its obligations to for comment on the severance issue. last benefit we had,” said Ronald the retirees under the settlement Olbrysh, one of the Sears retirees Lampert’s lawsuit followed one filed agreement and under the bank- asking for the committee. Olbrysh against him by the Sears estate ruptcy code. The retirees request said that many Sears retirees that accused him of wrongly trans- that the court direct the appoint- dropped their existing life insur- ferring $2 billion of company assets ment of a committee to advocate for ance policies in favor of a company beyond the reach of creditors in the the thousands of retirees unjustly policy. “That was a mistake, but years before bankruptcy. and illegally losing their benefits.” they relied on Sears.” Portions of this article were taken If the Bankruptcy Court directs Olbrysh is also the chairman of from a report by Josh Saul in the a retiree committee to be formed, the National Association of Retired May 30 issue of Bloomberg. one of the important issues that Sears Employees, which notified its —STRAIGHT TALK Summer 2019— 6 SEARS ATLANTA BIG CLUB

The largest Sears retiree club in the country, the At- lanta Big Club held its quarterly meeting on May 28. One hundred plus members turned out for this meet-

Beth Probert, Brian Kwon and retiree Sandra Wheeler

Beth told the retirees that New York Life, as an AAA+ Brian Kwon with his insurance brochures rated and fortune 61 company “has maintained the ing extravaganza hosted by the club’s president, “SKIP” BALILES.

The keynote speakers were Beth Probert and Brian Kwon, agents with New York Life Insurance Company. As a result of Sears Holdings terminating the retir- ees’s life insurance, Beth and Brian presented some very favor- able insurance options.

Beth Probert speaking to the retirees

highest strength, integrity and stability for the last 174 years.”

Many of you may not know that in addition to being a phenomenal leader of the Big Club, Skip has also dabbled with photography. No “selfies,” but many “groupies” as set forth on this page.

—STRAIGHT TALK Summer 2019— 7 Former Chairman Eddie Lampert Stripped Retailer of $2 Billion in Assets, Sears Lawsuit Claims

Sears Holdings Corp. is suing its ESL said it “vigorously” disputes in 2012, its stores numbered 4,000. former chairman and largest share- the claims and calls them “base- The approval of Lampert’s new holder, Eddie Lampert, alleging the less” and “fanciful” in a statement business means roughly 425 stores billionaire stripped the once iconic emailed to the Associated Press. and 45,000 jobs will be preserved. retailer of more than $2 billion in “The debtors’s allegations are mis- Unsecured creditors, who rank at assets during his reign atop the leading or just flat wrong,” ESL the bottom of the list to be paid, holding company. said, adding that Sears received objected to Sears’s sale to Lampert, The lawsuit, which was filed proceeds of more than $3 billion alleging falsified financial projec- (April 17) with the U.S. Bankrupt- tions, excessive buy backs, and a cy Court of the Southern District spinoff of brands that stripped the of New York, also names former business of key assets in a 100-plus Sears directors, including U.S. page document filed in late Janu- Treasury Steven Mnuchin as well ary. It chronicled what it called a as executives at Lampert’s hedge “tortured story of Sears.” fund ESL. But Sears’s unsecured creditors Sears Holdings operates Sears and repeatedly argued that Lampert Kmart stores. It filed for Chapter 11 was the cause of, not the solution bankruptcy protection in October, to, Sears’s downfall. They believe amid years of massive losses and that Lampert, along with Sears’s sales drops. biggest shareholders, unduly ben- efitted from deals that occurred Lampert salvaged the company under Lampert’s watch, including by acquiring what was left of its its spinoff of Lands’ End in 2014, assets in a court-approved auc- and the carve out of many of its best tion through an affiliate of ESL in properties into Seritage Growth February. Unsecured creditors had Properties, a real estate investment tried to block the sale, maintaining trust Lampert created a year later. that Lampert was to blame for the company’s downfall. Those claims laid the groundwork for the unsecured creditors to pur- The 110-page lawsuit cited sales sue their claims against Lampert or spinoffs of key assets that Edward Lampert, and others on behalf of Sears. Lam- were allegedly used to line Lam- Former Sears Chairman pert had requested a release from pert’s own pockets and that of from the transactions, all of which potential litigation as part of his his hedge fund. That includes were applied to reduce debt and deal to buy Sears out of bankruptcy the spinoff of Lands’ End in 2014 fund operations. “ESL was a con- but was denied the protection. and Lampert’s real estate in- stant source of financing for Sears vestment trust Seritage Growth Among the allegations lobbed at Lam- Holdings for many years,” it said. created four years ago to extract pert, the company said he rejected a revenue from Sears’s properties. Lampert, who merged Sears and $1.6 billion offer for Lands’ End from Kmart in 2005, steered Sears into firm Leonard Green & “Altogether, Lampert caused more Chapter 11 bankruptcy protection Partners and the Tommy Hilfiger in- than $2 billion of assets to be trans- in October. The company’s corpo- vestment group in favor of a spin that ferred to himself and Sears’s other rate parent had 687 stores and would keep his stake in the brand shareholders and beyond the reach 68,000 employees at the time of untouched. continued on page 9 of Sears’ creditors,” the suit stated. the bankruptcy filing. At its peak —STRAIGHT TALK Summer 2019— 8 Lawsuit continued from page 8 It cites an email from the company’s then-CFO, Robert Schriesheim, who explained to another Sears em- ployee that “[Lampert] was trying to optimize cash for [Sears] while maximizing his equity stake … because he knows that [Lands’ End] is worth a great deal outside of [Sears].”

The suit also claims that, “In an ef- fort to create a false record to cover up their asset stripping, at Lam- pert’s personal direction, Sears’s employees repeatedly produced financial plans reflecting fanci- Rep. Alexandria Ocasio-Cortez ful, bad-faith predictions that the company would experience an im- AOC and Elizabeth Warren mediate and dramatic turn-around from deep and mounting losses to Call Eddie Lampert’s Moves sudden profitability.” to Avoid Paying Sears The suit names numerous de- fendants besides Lampert and Severance a ‘Betrayal’ Mnuchin, including two high- Former Sears Chairman and CEO Eddie Lampert profile directors: Bruce Berkowitz, has some powerful new opponents. a hedge-fund manager who was a large in Sears, and Kunal On May 30, presidential candidate costs because Sears Holdings didn’t Kamlani, president of ESL. Sen. Elizabeth Warren and Rep. Al- fulfill certain aspects of the deal. exandria Ocasio-Cortez (AOC) Berkowitz took his own swing at In their letter, Warren, D-Mass., sent a letter to Eddie Lampert, the Lampert’s management of Sears last and Ocasio-Cortez, D-N.Y., called hedge fund billionaire lambasting year, when a lawyer for Fairholme out Lampert’s earlier assurances his efforts to shirk repaying Sears told the bankruptcy court that that workers that lost their jobs Holdings for $43 million in sever- Sears was “not so much a melting after Sears filed for bankruptcy on ance payments to thousands of ice cube as it is a puddle.” He called Oct. 15 would be guaranteed an laid-off Sears’s workers. the retailer’s tumble from grace a exit package. “multi-year liquidation” that hap- Lampert agreed to cover the pay- “The failure to make those pay- pened “without court supervision.” ments as part of the terms of the ments would amount to a broken deal he struck in February to buy “ESL Investments, Inc. vigorously promise on your part and a betrayal the bankrupt chain for $5.2 billion disputes the claims in the debtors’s of hardworking Sears’s employees— through Transform Holdco, LLC, a complaint against ESL, Mr. Lam- some of whom have worked at the subsidiary of his hedge fund, ESL pert and Mr. Kamlani, which company for decades—who are rely- Investments Inc. repeats baseless allegations and ing on the severance that they have fanciful claims. As we have previ- In the agreement, he promised to been promised to pay rent, care for ously said, the debtors’s allegations continue operations at 425 stores children and put food on the table,” are misleading or just flat wrong,” a and save the jobs of 45,000 employ- they wrote. spokesman from ESL said. ees. Since then, however, he has In a statement to Footwear News argued to the court that he should Edited from articles by CBS News (FN), a continued on page 10 not be responsible for the severance and CNBC, April 18, 2019 —STRAIGHT TALK Summer 2019— 9 ‘Betrayal’ continued from page 9 spokesperson for Transform Holdco said that the lawmakers’s letter mischaracterizes the dispute, say- ing in part, “To be clear, employees of old Sears who lost their jobs during bankruptcy have already received their severance payments. The approval that Transform has sought from the Court is to be released from its conditional obli- gation to reimburse Old Sears for making those severance payments.”

Lampert recently filed court docu- ments alleging that Sears Holdings failed to make payments to vendors and transfer certain promised as- sets to ESL, including part of the company’s Chicago headquarters and store inventory.

“Because of these shortfalls, [ESL] believes it has no obligation to as- sume $43 million in severance,” ESL’s lawyers argued in the filing.

Sears Holdings filed a lawsuit against Lampert last month ac- cusing the executive of siphoning billions of dollars in assets from the struggling retailer for his own enrichment while allowing it to sink into bankruptcy.

“Eddie Lampert … in concert with and assisted by other defendants, transferred billions of dollars of the company’s assets to its share- holders for grossly inadequate consideration or no consideration at all,” the lawsuit read. “This com- plaint is brought to make Sears whole for these thefts of its assets.”

In a statement to FN at the time, ESL wrote that it “vigorously disputes the claims in the debtors’s complaint,” reiterating that the allegations were “misleading or just flat wrong.”

Edited from an article by Hilary George-Parkin, Footwear News, The retiree life insurance funeral procession. May 31, 2019 —STRAIGHT TALK Summer 2019— 10 Chairman’s Page RENEW YOUR 2019 SUBSCRIPTION TODAY!

Since March 15 I have re- N.A.R.S.E. Thanks You! ceived a countless number of Our board of directors thanks all of the retirees who phone calls and emails from have contacted N.A.R.S.E. and Sears Holdings about Sears’s retirees surprised the cancellation of the promised life insurance. For that their former company our senior citizens, this has been a real shock and a would cancel their promised financial hardship. life insurance. The company We also want to thank you for your financial assistance that treated us as family, and over the past 22 years. We could not have achieved this whose corporate headquar- significant event without the broad cross-section sup- ters was once called “Parent” port of former and very active Sears retired associates. when we worked there, no longer exists. As I have told you many times before, N.A.R.S.E. is an Ron Olbrysh, all-volunteer organization with no paid employees. We N.A.R.S.E. Chairman are funded solely by the retiree membership dues and Letter from a Retiree’s Daughter voluntary contributions. The dues we receive are used The following is a representative sampling of the type to support our communication efforts with the tens of of communications we have received about Sears thousands of retirees across the country. Holdings’s terminating the retirees’s life insurance. This email came from the daughter of a recently de- As a result of Sears Holdings’s latest decision regard- ceased retiree. ing a retiree benefit, we need your support more than ever before. “Good afternoon. I have been following the cancelling of the Sears retirees’s life insurance since my mother If you have not done so yet, please renew your received the cancellation letter in late March. My N.A.R.S.E. membership for 2019 now. mother … retired from the Heath, Ohio, Sears store Enclosed is a N.A.R.S.E. Membership/Renewal Appli- in 1993 after 23+ years of service. - cation form and mailing envelope. If you have already “At the time when she received the cancellation let renewed, please pass the application form to someone ter she had been hospitalized for a couple of weeks who would be interested in supporting our organization. and was not physically able to complete and sign We sincerely hope that Sears will reconsider its de- the paperwork to convert her life insurance, and cision about the retiree life insurance termination. unfortunately she passed away on May 10th at the age of 87.

“The cost for her to convert her $8,000 policy to a $5,000 policy would have cost her $654 a quarter (or- $2,616 annually for a $5,000 policy!) How many re tirees on fixed income could afford those premiums?

“When her life insurance information was given to the funeral home, they of course were told by Securian that the policy was no good.

“I will continue to follow this on-going issue and hope for the best results for the retirees.” Sondra Barton

No Life Insurance. No Casket. —STRAIGHT TALK Summer 2019— 11 —STRAIGHT TALK Summer 2019— 12