Boeing 2009 Annual Report Download - page 118

instead allege that the current collective bargaining agreement is the sole alleged source of rights to
retiree medical benefits. Both parties filed Motions for Class Certification on November 16, 2007 and
filed briefs on class certification on February 28, 2008. The parties filed cross-motions for summary
judgment on May 27, 2008. On September 30, 2008, the court certified a class of retirees for all claims.
On September 9, 2009, the court granted Boeing’s motion and ruled that the retiree medical benefits
were not vested lifetime benefits and that the 2006 changes to benefits did not violate the 2005
collective bargaining agreement. On October 8, 2009, the plaintiffs filed a notice of appeal to the
Seventh Circuit Court of Appeals.
On October 13, 2006, we were named as a defendant in a lawsuit filed in the U.S. District Court for the
Southern District of Illinois. Plaintiffs, seeking to represent a class of similarly situated participants and
beneficiaries in the Boeing Company Voluntary Investment Plan (the VIP Plan), alleged that fees and
expenses incurred by the VIP Plan were and are unreasonable and excessive, not incurred solely for
the benefit of the VIP Plan and its participants, and were undisclosed to participants. The plaintiffs
further alleged that defendants breached their fiduciary duties in violation of §502(a)(2) of ERISA, and
sought injunctive and equitable relief pursuant to §502(a)(3) of ERISA. Plaintiffs filed a motion to certify
the class, which we opposed. On December 14, 2007, the court granted plaintiffs leave to file an
amended complaint, which complaint added our Employee Benefits Investment Committee as a
defendant and included new allegations regarding alleged breach of fiduciary duty. The stay of
proceedings entered by the court on September 10, 2007, pending resolution by the U.S. Court of
Appeals for the Seventh Circuit of Lively v. Dynegy, Inc., was lifted on April 3, 2008, after notification
that the Lively case had settled. On April 16, 2008, plaintiffs sought leave to file a second amended
complaint, which we opposed, which would add investment performance allegations. On August 22,
2008, the court granted plaintiffs leave to file their second amended complaint. On September 29,
2008, the court granted plaintiffs’ motion to certify the class of current, past and future participants or
beneficiaries in the VIP Plan. On September 9, 2008, we filed a motion for summary judgment to
dismiss claims arising prior to September 27, 2000 based on the ERISA statute of limitations. On
October 14, 2008, we filed a petition for leave to appeal the class certification order to the Seventh
Circuit Court of Appeals. On January 15, 2009, we filed a motion seeking dismissal of all claims as a
matter of law. On August 10, 2009, the Seventh Circuit Court of Appeals granted Boeing’s motion for
leave to appeal the class certification order. The district court entered a stay of proceedings in the trial
court pending resolution of the class certification appeal. On December 29, 2009, the district court lifted
on plaintiffs’ motion the stay of proceedings previously entered. Boeing responded by filing an
Application for Stay Pending Appeal with the Seventh Circuit Court of Appeals on January 7, 2010.
BSSI/ICO Litigation
On August 16, 2004, our wholly-owned subsidiary, Boeing Satellite Systems International, Inc. (BSSI)
filed a complaint for declaratory relief against ICO Global Communications (Operations), Ltd. (ICO)
in Los Angeles County Superior Court seeking a declaration that ICO’s prior termination of two
contracts for convenience extinguished all claims between the parties. On September 16, 2004, ICO
filed a cross-complaint alleging breach of contract, economic duress, fraud, unfair competition, and
other claims. ICO added The Boeing Company as a defendant in October 2005 to some of these
claims and also sued it for interference with contract and misappropriation of trade secrets. On
January 13, 2006, BSSI filed a cross-complaint against ICO, ICO Global Communications (Holdings)
Limited (ICO Holdings), ICO’s parent, and Eagle River Investments, LLC, parent of both ICO and ICO
Holdings, alleging fraud and other claims. The trial commenced on June 19, 2008, with ICO seeking to
recover approximately $2,000 in damages, including all monies paid to BSSI and Boeing Launch
Services, plus punitive damages and other unspecified damages and relief.
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