DELPHI 2015 Annual Report Download - page 121

Table of Contents
99
Fair Value Measurements Using Significant
Unobservable Inputs (Level 3)
Real Estate
Trust Fund Hedge Funds
Insurance
Contracts
(in millions)
Beginning balance at December 31, 2013........................................... $ 45 $ 90 $ 4
Actual return on plan assets:
Relating to assets still held at the reporting date ....................... (2) 9 —
Purchases, sales and settlements .................................................... 1 7 (3)
Foreign currency translation and other........................................... (3)(4) —
Ending balance at December 31, 2014................................................ $ 41 $ 102 $ 1
Actual return on plan assets:
Relating to assets still held at the reporting date ....................... $(3) $ 5 $ —
Purchases, sales and settlements .................................................... 2——
Foreign currency translation and other........................................... (1)(5) —
Ending balance at December 31, 2015................................................ $ 39 $ 102 $ 1
13. COMMITMENTS AND CONTINGENCIES
Ordinary Business Litigation
Delphi is from time to time subject to various legal actions and claims incidental to its business, including those arising
out of alleged defects, alleged breaches of contracts, product warranties, intellectual property matters, and employment-related
matters. It is the opinion of Delphi that the outcome of such matters will not have a material adverse impact on the consolidated
financial position, results of operations, or cash flows of Delphi. With respect to warranty matters, although Delphi cannot
ensure that the future costs of warranty claims by customers will not be material, Delphi believes its established reserves are
adequate to cover potential warranty settlements.
GM Ignition Switch Recall
In the first quarter of 2014, GM, Delphi’s largest customer, initiated a product recall related to ignition switches. Delphi
received requests for information from, and cooperated with, various government agencies related to this ignition switch recall.
In addition, Delphi was initially named as a co-defendant along with GM (and in certain cases other parties) in class action and
product liability lawsuits related to this matter. As of December 31, 2015, Delphi was not named as a defendant in any class
action complaints. Although no assurances can be made as to the ultimate outcome of these or any other future claims, Delphi
does not believe a loss is probable and, accordingly, no reserve has been made as of December 31, 2015.
Unsecured Creditors Litigation
The Fourth Amended and Restated Limited Liability Partnership Agreement of Delphi Automotive LLP (the “Fourth LLP
Agreement”) was entered into on July 12, 2011 by the members of Delphi Automotive LLP in order to position the Company
for its initial public offering. Under the terms of the Fourth LLP Agreement, if cumulative distributions to the members of
Delphi Automotive LLP under certain provisions of the Fourth LLP Agreement exceed $7.2 billion, Delphi, as disbursing agent
on behalf of DPHH, is required to pay to the holders of allowed general unsecured claims against DPHH, $32.50 for every
$67.50 in excess of $7.2 billion distributed to the members, up to a maximum amount of $300 million. In December 2014, a
complaint was filed in the Bankruptcy Court alleging that the redemption by Delphi Automotive LLP of the membership
interests of GM and the PBGC, and the repurchase of shares and payment of dividends by Delphi Automotive PLC, constituted
distributions under the terms of the Fourth LLP Agreement approximating $7.2 billion. Delphi considers cumulative
distributions through December 31, 2015 to be substantially below the $7.2 billion threshold, and intends to vigorously contest
the allegations set forth in the complaint. In June 2015, the plaintiffs' and Delphi's motions for summary judgment were denied.
Both parties filed supplemental briefs in July 2015. Although no assurances can be made as to the ultimate outcome of this
claim, Delphi does not believe a loss is probable and, accordingly, no reserve has been made as of December 31, 2015.
Brazil Matters
Delphi conducts significant business operations in Brazil that are subject to the Brazilian federal labor, social security,
environmental, tax and customs laws, as well as a variety of state and local laws. While Delphi believes it complies with such