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Welcome current and future DuPont retirees –The NRLN (National Retirees Legislative Network) is a nationwide organization that advocates for federal legislation to protect retiree benefits including pensions, company provided healthcare, Social Security, Medicare, and lower prescription drug costs. We started this DuPont Retirees Chapter (DRC) due to concerns about the long-term security of our underfunded pension plan. With our email utility delivering key documents to our members directly, and with this webpage, we strive to be a key communication mechanism on retiree issues, as DowDuPont carries out a plan to split into three smaller companies.
Please review our communications on pension and other retiree issues in the left column below. The most current notes are always visible, while older communications are archived in reverse chronological order. The right column below is a repository of pertinent media articles about the merger and pension issues. We hope that you will review the wealth of information on our DRC page, as well as on the NRLN homepage.


Feel free to comment or ask questions by emailing Jim Odle, Chapter President at odlejk@gmail.com

Useful Links for DuPont Retirees: Retiree website - http://www.retiree.dupont.com/     DowDupont Investor Relations - http://www.dow-dupont.com/investors/default.aspx


DUPONT PENSION SECURITY COMMUNICATIONS

View Archived Communications
DRC history and activities; current and archived communications with DRC Membership and Corporate Management concerning pension security


July 20, 2020
From: Paul Kende and Jim Odle
To: NRLN DuPont Retirees Chapter
Subject: DuPont/Corteva Pension Plan Historical Financial Overview

This is the first update of the financial history of the former DuPont Pension Plan since Corteva Agriscience assumed its sponsorship on June 1, 2019 – and is based on the April, 2020 Annual Funding Notice (AFN), which reports the status of the Plan over a 3-year period (2017, 2018, 2019). We have posted Plan Participant and performance data from AFNs, dating back to 2007 on the graph below, so we can better see and assess the Plan and its security.

pension plan

U.S. Pension Plan Participants numbered nearly 150,000 in 2010, but this is down to about 107,000, due to attrition and Lump Sum Buyouts (LSB) in 2016/17; these Participants include retirees, and people vested in the Pension Plan, whether active Chemours, New DuPont or Corteva employees, or former employees.

The Funding Target Attainment Performance (FTAP %) is a key indicator of Plan status and security. Ideally, the Funding Level should be 100%, so that current assets, growing at expected rates of return, would generate sufficient funds to pay all obligations. Actual Funding Level is affected by Sponsor contributions, investment performance of Plan assets and mortality projections of Plan Participants.

The graph shows 3 different FTAP % curves, based on different liability discount rates used in calculating the present value of future obligations. Prior to 2011, FTAP’s, represented by the blue line, were calculated using the 2006 Pension Protection Act (PPA) discount rate formula, based on the 2-yr average Treasury Bill yield. This FTAP basis shows a slide in performance from 80.2% at year-end 2010, to 69.4% in 2018, despite a $4B total contribution in 2017 and 2018. The 2008 financial crisis and the ensuing recession led to super low interest rates which increased Plan liabilities, driving FTAPs lower and requiring companies to make higher contributions to keep their plans from sinking to low, “at-risk” funding levels. Congress passed the 2012 MAP-21 legislation (extended to 2020), allowing plan sponsors to use 25-year average high-quality corporate bond yields to determine higher discount rates. This, in turn, reduced present value calculations of long-term pension plan obligations, raising their apparent Funding Levels and reducing the corresponding contribution requirements. Allowing MAP-21 to expire in 2020 would again increase minimum corporate contribution requirements in the current difficult financial environment. The House of Representatives included a further extension of MAP-21 in its recent Heroes Act; however, it is unclear if the Senate will consider this, or create their own stimulus bill, which may or may not include a MAP-21 extension.

The much higher MAP-21 based FTAP values are shown by the purple line, though this too shows a performance slide from 89.6% in 2011 to 80.0% in 2018, despite DuPont’s $4.0 billion contribution in 2017 and 2018. Typically, plans at 80% or below, are added to the Pension Benefit Guarantee Corporation’s “watch list” for potential plan termination.

The two FTAP calculations discussed above are based on actuarial data as of January 1 of the plan year (but displayed here as the December 31 value of the previous year, to synchronize all data). This is 16 months old information when the AFN-s are published in April. The third way of evaluating the Pension Plan financial status is expressed in the narrative on page 2 of the 2019 AFN report. There you will find the Fair Market Value (FMV) of the Plan’s assets and expected obligations as of December, 31 of the plan-year, making it the most recent information. We feel the FMV data is also the most accurate of the three because it measures plan assets at market value and, although liabilities are projected actuarially, it is a snapshot of the plan’s net worth at year-end. The red FMV-based FTAP graph indicates a funding level of 88.3% in 2018, but it has dropped to 83.2% in 2019.

Because excess Sponsor contributions, beyond the minimum requirements, go into the so-called “Prefunding Credit Balance”, these funds are not included in the reported MAP and Non-MAP FTAPs; however, the FMV calculations do recognize all contributions, as indicated by its sharp increase in 2017/18 Funding Level. We believe the most appropriate retiree vantage point, for assessing the security of our DuPont/Corteva Pension Plan, is the one provided by the Fair Market Value-based calculation, which is also the basis of the February “10K” reports submitted to the SEC, indicating our Plan’s financial status on 12/31 of the prior year.

Pension Plan Participants have asked about the likelihood of additional Lump Sum Buyout offers, and/or transferring the Pension Plan to an insurance company for annuities, as well about the status of the legal action against DuPont and Corteva for ERISA violations. A few comments on these issues are summarized below:

  • E. I. DuPont (EID), now a wholly owned subsidiary of Corteva, is the Plan’s Sponsor; EID, with Corteva behind it, must comply with ERISA rules, fund the Plan and fulfill its obligations to the Plan Participants, in the same way as our former employer, E.I. DuPont was.
  • The closer the Plan comes to 100% Funding Level, the easier it would be to annuitize our pensions through an insurance company, which would require eliminating some or all of the current $3.3B Plan shortfall, and pay a fee to the insurance Company. If this were to happen, our pensions would no longer be guaranteed by the Federal Government’s Pension Benefit Guaranty Corporation (PBGC); instead, state-based Insurance Associations would provide some coverage against potential insurance company failure, but at a much lower maximum level than the PBGC would. In our view, additional secondary insurance, with an independent insurer, would be essential to compensate for the loss of the PBGC guarantees.
  • A Lump Sum Buyout, usually with an Annuitization option offered to Participants, is a possible but potentially expensive option for Corteva. And, depending on the discount rate used to determine the present value of each lifelong pension, as well as personal circumstances, it may or may not be advantageous to Participants.
  • As we reported on 8/1/19, 4 DuPont retirees filed a complaint on 7/3/19 in a California Federal District Court, requesting certification for Class Action, to sue Corteva, DuPont, Dow, DowDuPont and members of top management, for violating ERISA laws. Probably relevant to this case, in a 5:4 decision on 6/1/20, the U.S. Supreme Court confirmed two lower court rulings in Thole v. U.S. Bank that, without actual financial injury, retirees cannot sue their former employer for breach of fiduciary duty, regardless of losses to the Plan itself. This is a similar outcome to the 2016 Court of Appeals dismissal of the Class Action against Verizon. Without commenting on the legal merits of various claims in the Class Action Complaint, the current status of the case is:
    • On 4/27/20, the Court granted Corteva’s motion to dismiss, but allowed Plaintiffs to amend the Complaint.
    • Plaintiffs filed an Amended Complaint, alleging that the way DuPont off-loaded the Pension Plan on Corteva, effectively terminated or transferred the Plan, without fully funding it, as required by ERISA laws.
    • Motions and responses have taken place in June and July, with oral arguments scheduled for July 28.

Your comments and questions are welcome....Paul Kende (paul.kende@gmail.com) and Jim Odle (odlejk@gmail.com)

Read the latest NRLN actions during the month.review

Read the latest NRLN FOCUS Newsletter
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donut hole
The donut hole is closed, but drugs won’t be free! Click here to read the entire article that has important information.


DUPONT AND CORTEVA IN THE NEWS

Media articles about DuPont and DowDuPont retiree benefits and corporate restructuring. Some publications may require subscriptions, and/or login for unlimited viewing



DuPont Receives U.S. Environmental Protection Agency Safer Choice Partner of the Year Award
PRWeb ~ Sep 25, 2020

Opinion: Why DuPont de Nemours (DD) Stock is a Compelling Investment Case
By Alex Smith; Insider Monkey ~ Aug 24, 2020

Chemours eyes settlement of DuPont beef
By Alexander H. Tullo; C&EN ~ Aug 13, 2020

DuPont Highlights Solar Innovations at 2020 SNEC PV Power Expo
Via “Cision”;Yahoo Finance ~ Aug 10, 2020

Settlement With DuPont Likely on PFAS Liability, Chemours Says
By Pat Rizzuto; Bloomberg Law ~ Jul 31, 2020

DuPont takes $2.5 billion charge tied to auto business, posts wider loss
By Taru Jain; Reuters ~ Jul 30, 2020

Supreme Court Decision in Thole v. U.S. Bank Has Major Implications for Pensions

DuPont Develops the Next Generation of Styrofoam™ Brand Insulation to Reduce Greenhouse (GHG) Emissions and Advance 2030 Sustainability Goals
Business Wire ~ Jul 16, 2020

Supreme Court of the United States – Decided June 1, 2020
THOLE ET AL. v. U. S. BANK N. A. ET AL.

DuPont to pay $3 million for pollution problems at La Porte, Texas, plant
By Cheryl Hogue; Chemical & Engineering News ~ Jul 13, 2020

Opinion analysis: Supreme Court protects defined-benefit plan fiduciaries from lawsuits
By Dana Muir, SCOTUSBlog, June 1, 2020

DuPont Declares Regular Quarterly Dividend on Common Stock
PR Newswire ~ Jun 25, 2020

DuPont, Lowe’s, manufacturer supplied badly needed gowns for first responders and medical professionals
Delaware Business Now ~ Jun 23, 2020

General Motors scores big $214.3M Army contract to provide troop carrier
By Eric D. Lawrence; Detroit Free Press ~ Jun 27, 2020

DuPont commits $100,000 to Midland flood relief
Midland Daily News ~ May 22, 2020

Tampa Bay Water files ‘forever chemicals’ lawsuit against DuPont, 3M
By Zachary T. Sampson; Tampa Bay Times ~ May 19, 2020

Court dismisses fiduciary breach claims against Dow, DuPont
By James Comtois, Pensions & Investments – April 30, 2020

DuPont’s Quarterly Earnings Beat Estimates. That Could Boost the Beaten Up Stock.
By Al Root: Barron’s ~ Apr 20, 2020

DuPont ramps up production of protective suits with FedEx airlifting shipments
Delaware Business Now ~ Apr 14, 2020

Beebe Healthcare, Nemours and DuPont print protective gear for COVID-19 workers
By Marina Affo; Delaware News Journal ~ Apr 14, 2020

Dupont to deliver millions of Tyvek suits to aid coronavirus fight
By Chris Newmarker; MassDevice ~ Apr 09, 2020

Cummins and DuPont Partner to Use Filter Technology to Supply Critical Material for N95 Respirator Masks
Business Wire ~ Apr 06, 2020

Judge dismisses Chemours lawsuit against DuPont
By Randall Chase; The Associated Press ~ Mar 30, 2020

DuPont expediting production of Tyvek hazmat suits for health care workers
By Heidi Przybyla; NBC News ~ Mar 26, 2020

DuPont planning to appeal $50M verdict in C8 case
By Jess Mancini; The Parkersburg News and Sentinel ~ Mar 05, 2020

DuPont Owes $50 Million in PFAS Cancer Cases, Jury Finds (Corrected)
By Alex Ebert; Bloomberg Environment ~ Mar 03, 2020

DuPont Rises as Former CEO Ed Breen Reclaims the Helm
By M. Corey Goldman; TheStreet ~ Feb 18, 2020

DuPont brings back Breen in leadership shakeup
Delaware Business Times – Feb 18, 2020

DuPont De Nemours Fires CEO And CFO
By Ezequiel Minaya; Forbes ~ Feb 18, 2020

DuPont Met Earnings Estimates, but Its Stock Is Falling Because 2020 Looks Bland
By Al Root; Barron’s ~ Jan 30, 2020

DuPont to Explore Divestiture of Electronics Unit
By Kiel Porter & Myriam Balezou; Bloomberg ~ Jan 16, 2020

Corteva, Inc. [CTVA] – Is there any real value to CTVA Stock or is it vaporware?
By Abby Carey, Winnex.com – Jan 14, 2020

DuPont Investing $75M In Modernization Of Virginia Plant The company will modernize and expand its manufacturing and technology operations in Chesterfield County, VA, creating 60 jobs.
Business Facilities ~ Jan 08, 2020

DuPont: Pouring The Cocktail
SeekingAlpha – Dec 30, 2019

Opinion: Why DuPont de Nemours, Inc.’s (NYSE:DD) Return On Capital Employed Is Impressive
Via “Simply Wall St”; Yahoo Finance. ~ Dec 22, 2019

DuPont Has Narrowed Its Focus. Analyst Sees a Winner for 2020.
By Evie Liu; Barron’s ~ Dec 17, 2019

DuPont sheds nutrition business; impact on jobs unknown
By Karl Baker; The News Journal ~ Dec 16, 2019

DuPont to spin and merge another business unit
Delaware.com - Dec 16, 2019

DuPont to Acquire Desalitech
“By DuPont”; Cision ~ Dec 11, 2019

PFAS Plaintiffs Score Partial Win Over DuPont in Ohio Litigation
Bloomberg Environment ~ Nov 26, 2019

DuPont Faces ‘Dark Waters’ as Oscar-Bait Film Nears Release
By Aoyon Ashraf; Bloomberg ~ Nov 08, 2019

DuPont to Explore Divestiture of Its Transportation Unit
By Kiel Porter, Myriam Balezou & Rick Clough; Bloomberg ~ Nov 07, 2019

DuPont Stock ‘Is Too Cheap’ and Has Catalysts
By Al Root; Barron’s ~ Nov 01, 2019

DuPont’s Earnings Beat the Street. They Also Point to a Stronger World Economy.
By Al Root; Barron’s ~ Oct 31, 2019

DuPont employees face ongoing pay issues
By Ashley Schafer; Midland Daily News ~ Oct 08, 2019

Market Too Focused on Corteva's Near Term
By Seth Goldstein, Morningstar – Oct 7, 2019

DuPont Rises After Strong Boost by New Analyst
From Scott Van Voorhis; TheStreet ~ Oct 04, 2019

DuPont painted as villain in trailer for movie 'Dark Waters'
By Sarika Jagtiani & Ryan Cormier; The News Journal ~ Sep 21, 2019

DuPont changes continue with toxic chemical pledge and $450M sale of semiconductor biz
By Karl Baker; The News Journal ~ Sep 11, 2019

Buy DuPont Stock Because It Could Break Up Again, Citigroup Says
Al Root, Barron’s – Sept 11, 2019

DuPont Partners with Habitat for Humanity on energy-efficient home building projects
Via Habitat for Humanity International; Cision ~ Aug 13, 2019

DuPont Considers Sale of Biosciences Unit That Could Fetch $20 Billion
Kiel Porter, Dinesh Nair and Richard Clough, Bloomberg – Aug 7, 2019

DuPont Considers Sale of Biosciences Unit That Could Fetch $20 Billion
By Kiel Porter, Aaron Kirchfeld & Myriam Balezou; Bloomberg ~ Aug 06, 2019

DuPont Just Beat Earnings Estimates. Here’s What It Means for the Stock.
By Al Root; Barron’s ~ Aug 01, 2019

Buy Dow Stock for the Dividend as the Breakup Dust Settles
By Ian Bezek, InvestorPlace – July 23, 2019

Class Suit Filed Over DuPont Pension Funds
By Katheryn Tucker; Law.com ~ Jul 12, 2019

Dow, DuPont and Corteva Sued for Allegedly Ducking Pension Obligations
By John Manganaro, Plan Advisor – July 9, 2019

Pension Participants Claim ERISA Breaches in Dow DuPont Pension Transfer
By John Manganaro; Plansponsor ~ Jul 09, 2019

Union leaders asked rebooted DuPont to change more than its slogan
From Joseph N. DiStefano; The Philadelphia Inquirer ~ Jul 08, 2019

Class action pension suit filed against Corteva, DuPont
Delaware Business Now – July 6, 2019

DuPont becomes independent company
By Scott Francis; CompositesWorld ~ Jul 03, 2019

Chemours files lawsuit against DuPont
By Jess Mancini; The Marietta Times ~ Jul 03, 2019

DuPont Unveils First Dividend Since DowDuPont Breakup
By Lawrence C. Strauss; Barron’s ~ Jun 27, 2019

DuPont Stock Requires ‘a Leap of Faith.’ Not All Analysts Are Jumping.
By Al Root; Barron’s ~ Jun 20, 2019

Is DuPont a Buy? The new specialty materials company will have the highest operating margin of the three DowDuPont spinoffs.
By Maxx Chatsko; The Motley Fool ~ Jun 11, 2019

The New DuPont Stock Is a Winner on Wall Street as a Price Target Is Doubled
By Al Root; Barron’s ~ Jun 05, 2019

DuPont re-emerges as freestanding company
Delaware Business Now ~ Jun 04, 2019

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