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 Advice to LRO Members

Lucent Alumni Website Offers Directory of Former Colleagues and Friends

A number of members stated in the LRO survey that they would like to have a way to contact other Lucent retirees.  The Lucent Alumni Center provides an Alumni Directory of those individuals who elected to have their contact information available to others.  Since this is available through Lucent, the LRO will not spend the time and expense to duplicate this service on the LRO website.

Click here  to access the Lucent Alumni Center.  This website requires that you establish a username and password in order to login.  When you have logged in, you may click on the "Alumni Directory" option to search for former colleagues and friends or to create your personal profile to be available to those who want to contact you.

Where To Calculate Tax Basis Information On AT&T Stock

If you have sold or sell any of your shares of AT&T stock, you need to determine your tax basis in order to compute the gain or loss on the shares. The tax basis is compared to the proceeds received from the sale of shares to determine the gain or loss for income tax purposes. The tax basis may also be important for gift or estate tax purposes. Go to to access the AT&T Investor Relations website to view instructions and worksheets that will help you to calculate your tax basis.  

SEC Offers Channel For Complaints On Missing Or Late Alcatel-Lucent Annual Meeting Information

A number of LRO members who are Alcatel-Lucent shareowners have notified the LRO that they did not receive information and proxy ballots for the June 1 Alcatel-Lucent Annual Meeting in Paris. Others have stated in emails that while they received their Annual Meeting packet, there was not sufficient time to study the proposed resolutions and vote prior to the deadline.

An LRO Board member has checked with the Securities Exchange Commission in Washington, DC to determine whether the SEC would be interested in receiving complaints from individual shareowners on this issue. A representative for the SEC's Office of Investors Education Assistance said the OIEA would welcome information from Alcatel-Lucent shareowners who did not receive their Annual Meeting information or received it late.

Shareowners may file a complaint mail a letter to: ATTN: OIEA SEC 100 F Street Northeast Washington, DC 20549 The phone number for the SEC is 202-942-8088 and the website is at

 Video recordings of Alcatel-Lucent Annual Meeting presentations by Serge Tchuruk, Chairman of the Board, Jean-Pascal Beaufret, Chief Financial Officer, and Pat Russo, Chief Executive Officer, can be accessed on the Alcatel-Lucent Investors Website . The Question/Answer portion of the meeting is not available on the website. As news reports on the meeting stated, several dozen French union members angered at job losses and executive pay packages often disrupted the executives' speeches by blowing whistles and horns.


Letters from LRO Leaders

LRO Secretary Eli Shaff has written a letter to his U.S. Senators and Representative about his severe reductions in annual benefits. Other Lucent retirees may want to similarly express their views to their elected representatives in Washington, DC. Click here to read Eli's letter.

To obtain your U.S. Senators' and Representative's contact information, go to the National Retiree Legislative Network website at

If you wish to send your message electronically, click on the link to your representative's website address and type or paste your message into your representative's web form usually available under the "Contact Us" page on his/her website.

If you receive a reply from your U.S. Senators and Representative, please send a copy to Bob Martina, LRO Legislative Director, at .

Alcatel USA Retirees Merged With Lucent Management Pension Plan

The LRO has learned that Alcatel USA retirees have been merged into the Lucent Management Pension Plan (the Lucent Retirement Income Plan). According to Alcatel-Lucent, the effect of the merger is less than ¼ of 1 percent on the overall over-funded status of the combined management plan.

The LRO believes that it was wrong of Alcatel-Lucent not to inform Lucent retirees or the LRO that the merger of the pension plans was going to be implemented. LRO President Ken Raschke has sent a letter to Alcatel-Lucent requesting additional information about the merging of the two pension plans. Click here to read Ken's letter.

Because Alcatel USA management retirees are now in the same pension plan with Lucent management retirees, the LRO Board has decided to invite Alcatel USA management retirees to become LRO members. If you know retirees from Alcatel USA invite them to join the LRO. Or, send their names and email addresses to LRO Vice President Andy Guarriello at and he will contact the individuals about becoming an LRO member.

LRO President Ken Raschke’s Letter On Management Retirees' 2008 Healthcare Coverage

In an October 18, 2007 letter from LRO President Ken Raschke that was emailed to LRO members, management retirees were told that 2008 healthcare insurance and prescription drug coverage is undergoing the most significant change since their retirement. Alcatel-Lucent has advised management retirees to consider using commercial insurance.

Raschke noted that although the LRO isn’t in a position to advise individual members, the LRO Benefits Team has compiled SIDE-BY-SIDE checklists for Lucent management retirees to compare Alcatel-Lucent’s plans with commercial insurance plans. Since it may take many weeks to get quotes and possibly choose an alternative plan, the LRO has advised management retirees to START NOW to collect information on commercial plans so they will have comparisons ready when Alcatel-Lucent provides specific information for the Open Enrollment dates of November 5 through 16, 2007. Click here to read Ken's letter. Click here to visit the Benefits Team home page to download the Checklists and a How To Use guide that provides step-by-step instructions on using the checklists. Adobe Reader software is required to open these files.

Because the LRO does not have advance access to the information that Alcatel-Lucent will provide to management retirees in the final 2008 enrollment packet for the healthcare and prescription drug plans, the present "Lucent data" in the checklists are based on the company's Summary Plan Descriptions and the 2008 Pre-Enrollment Newsletter. When the final enrollment packet arrives, if there are changes that need to be made to the "Lucent data," both the "How To Use" and "Checklists" will be updated and marked with a new date. The LRO will issue an email telling retirees to download whatever is new.

LRO President Ken Raschke Makes Healthcare Benefits Request To Alcatel-Lucent

On June 4, 2007, LRO President Ken Raschke emailed a letter dealing with retirees’ healthcare benefits to Alcatel-Lucent CEO Pat Russo.  He commended Alcatel-Lucent for its work with the CWA and IBEW to gain legislation on a tax code change that will allow additional retiree healthcare funding through a special trust when pension assets are sufficiently overfunded, as is the case with the pension plan for formerly represented retirees.

Ken noted that "The win in Congress makes it possible for Alcatel-Lucent to now offset healthcare cost for represented retirees who represent the lion’s share of your corporate healthcare costs in the USA." He then asked, “The LRO would like to know whether this major corporate savings will result in a reprieve from the financial burdens that management retirees and their dependents have experienced in recent years in the form of huge increases in their healthcare costs?”

In closing, the letter stated that “The LRO would welcome the establishment of a dialogue with Alcatel-Lucent about the future healthcare benefits of Lucent management retirees.” Click here to read Ken’s entire letter.

 Alcatel-Lucent Says 2008 Healthcare Details Will Be Sent To Retirees Before End Of July

On May 12, 2007, LRO President Ken Raschke sent a letter to Alcatel-Lucent CEO Pat Russo to inquire when the company was going to provide information to retirees about 2008 healthcare benefits. Last fall, the company stated in the 2007 healthcare enrollment information that plans for 2008 would be communicated to retirees “early in 2007.”

John Hickey, Alcatel-Lucent Human Resources Vice President, called Ken on May 24, 2007 to inform the LRO that information about 2008 healthcare benefits would be mailed to retirees before the end of July. Mr. Hickey did not give any indication on what might be in store for retirees’ healthcare and prescription drug coverage in 2008.


LRO President Ken Raschke Emails Follow-Up Letter To Alcatel-Lucent About Lost Personal Information

Because of the high number of emails and phone calls the LRO has received from retirees concerned about their lost personal information and that of their dependents, LRO President Ken Raschke has emailed a second letter to Alcatel-Lucent CEO Pat Russo on the subject of the missing computer disk.

Ken stated in the letter that the LRO Board has concluded that the less-than-timely flow of information and the minimal practical actions and advice from Alcatel-Lucent's USA team have been, thus far, inadequate. "We believe that, by not being as forthcoming as this high profile incident warrants, the image of your new company is being jeopardized - - not only with employees, retirees, and their dependents, but with your customers and your markets and with American government leaders and the public as well."

The letter continued..."It is our intent to reflect to you the urgency of the situation and to offer specific suggestions that help both the retirees with whom we clearly share an interest and who may suffer serious impact as a consequence of these events and to help you better mobilize to find effective ways to resolve a situation that could possibly deteriorate further." Click here to read the entire letter.

LRO President Sends Letter To Alcatel-Lucent CEO About Missing Disk With Personal Information

LRO President Ken Raschke has sent a letter to Alcatel-Lucent CEO Pat Russo expressing Lucent retirees' concern about their personal information and that of their dependents that was on the missing computer disk. Ken offered a number of suggestions on what Alcatel-Lucent should do to help lessen the concerns of retirees and their dependents now and in the future about the security of their personal information. The LRO has offered to work with Alcatel-Lucent on future communications to retirees. Click here to read Ken's letter.

LRO Sends Letter To Pat Russo Seeking Information On 2008 Healthcare Benefits

Last fall when Lucent distributed the healthcare insurance enrollment information for 2007, the company promised to communicate details about 2008 healthcare benefits "early in 2007." LRO President Ken Raschke has sent a letter to Alcatel-Lucent CEO Pat Russo noting that we are well into the fifth month of the year and retirees want to know when they are going to receive the promised information. Click here to read Ken's letter.

LRO President Asks Alcatel-Lucent To Share Microsoft Lawsuit Dollars With Retirees  3/1/07

Alcatel-Lucent Turns Down LRO’s Request For A Meeting

The LRO is disappointed that executives for the new North America Region for Alcatel-Lucent have turned down LRO President Ken Raschke's request for a meeting.

The reason cited for refusing to meet with the LRO was: “the LRO’s active support of ongoing litigation involving retirees.” The LRO views this “reason” as a convenient excuse for Alcatel-Lucent to not address issues of concern to Lucent retirees.<>  It is disappointing that Alcatel-Lucent would take this position as a result of the LRO’s support of retiree causes in legitimate court proceedings and not withstanding that the LRO is not, and cannot be, a plaintiff in these lawsuits since the LRO does not have standing in the eyes of the courts.<>  Alcatel-Lucent North America Region leaders are obviously attempting to prevent the LRO from seeking explanations for a wide range of issues affecting retirees that have nothing to do with issues being litigated. We hope Alcatel-Lucent will reconsider its position to not engage in any a dialogue with the LRO.

 Click here to read Ken’s December 21, 2006 letter to Cindy Christy, President & CEO of Alcatel-Lucent North America Region.

 Click here to read the response from Patrick J. Vogeler, Vice President, Human Resources for Alcatel-Lucent North America Region.

Letter From Raschke To Members On Lucent-Alcatel Merger

Message From LRO President Ken Raschke Focuses On Lucent's 2007 Healthcare Enrollment

In a November 4 message to LRO members, President Ken Raschke stated that months ago, the LRO Board asked Lucent for information about its healthcare and prescription drug coverage intentions for 2007, but Lucent maintained its pattern of not sharing advance information with the LRO. As of November 4, the LRO knows that many retirees still have not received their personalized enrollment packet. Those who received their enrollment information in late October or early November, have the first specific information on the 2007 costs for healthcare and prescription drug plans. Thus, retirees must decide during the enrollment period from November 6 at 8:00 a.m. (Eastern Time) through November 17, 2006, at 6:00 p.m. (Eastern Time) whether to stay with the Lucent plans or change to “outside” plans. The short time frame leaves little time for comparing plans from other insurance companies and gaining medical certification when it is required. Click here to read some important points to keep in mind regarding the 2007 open enrollment.

LRO Seeks Lucent's Assurance That Pension Plan Won't Be Tapped For Layoff Allowances

After a November 7, 2006 news article reported that Lucent would layoff 150 U.S. employees with 30 days, LRO Present Ken Raschke sent a letter to Lucent Chairman and CEO Pat Russo. Ken requested assurance that Lucent would not use management pension plan assets to pay for layoff allowances. In a November 14, 2006 letter, William R. Carapezzi, Jr., Lucent's chief attorney, stated, "...the Lucent Retirement Income Plan is not being used for severance for any of the 150 affected employees. And as we have said in the past, there are no current plans to use the Lucent management pension plan to fund any other restructuring actions." Click here to read Ken's letter. Click here to read Mr. Carapezzi's response.

Department of Labor Responds To LRO Letter

On July 10, LRO President Ken Raschke sent a letter to Secretary of Labor Elaine Chao requesting that she call upon Assistant Secretary Ann L. Combs and her Employee Benefits Security Administration staff who are charged with ERISA enforcement to expeditiously intervene and require Lucent and Alcatel to take the following actions as a prerequisite to gaining the U.S. Government’s approval for the acquisition:

 1. DOL exercise its authority provided under ERISA to require Lucent to publish full Pension Plan financial and actuarial data. The data must be of such detail that an independent actuary can verify the basis for current levels of funding as professed by Lucent.

 2. Prompt action be taken by Lucent to bring the funding level of the Management Pension Plan (P-001) to 100% before the merger is effected. [By Lucent’s own admission, based on FASB standards, this Plan is currently under-funded by approximately $1.2 billion.]

 3. Require Lucent to make available to pension plan participants, as ERISA demands, the “Master Trust”—also called the “Irrevocable Trust”—agreement or other instruments under which the plan was established or operated. Lucent has repeatedly refused the LRO’s request for a copy of the Master Trust.

4. Require Lucent to immediately appoint independent fiduciaries to ensure that fiduciaries discharge their duties solely in the interest of the participants and beneficiaries as ERISA requires.

Details of whatever actions Lucent and Alcatel intend to take with regard to the pension plan are to be immediately made public so they can be examined to ensure they are in the recipients’ best interests. Click here to read Ms. Combs’ September 12, 2006 letter responding to the LRO.


Lucent’s Corporate Attorney Responds To LRO Letter To Pat Russo

On February 24, 2006, LRO President Ken Raschke wrote an open letter to Lucent Chairman & CEO Pat Russo. The purpose of Ken’s letter was to voice retirees ’ questions as to why,in her February letter to retirees and in her responses to retirees questions at the Lucent shareholders meeting, Ms Russo did not disclose the potential future risk associated with the management pension plan, and the healthcare and life insurance benefits. 

On March 8, 2006, Ken received a response from Lucent – not from Ms Russo, but from the Lucent corporate attorney, Mr. William R. Carapezzi, Jr.  In the last sentence of the Lucent response Mr. Carapezzi made the following request: “I ask that you please post this response on the LRO website. Ken sent an email back to Mr. Carapezzi acknowledging receipt of the letter and made the following suggestion: “In fairness to both Lucent Technologies and to its retirees, the LRO will post your letter on our website if you will agree to post my letter to Ms. Russo on your Lucent Alumni website. I shall look forward to your response.” 

The LRO has always posted Lucent letters, both to and from them, and Ken thought it was time and only fair that Lucent also share the LRO’s letter on its website.  Although Mr. Carapezzi has not responded to Ken’s "fairness" proposal, the LRO officers have decided to post Mr. Carapezzi’s letter plus the LRO comments on the five points stated in the letter.
  Click here to read Mr. Carapezzi’s letter.   Click here to read the LRO’s comments.

Ken Raschke Sends "Open Letter" To Pat Russo On Need To Present Retirees' Issues More Clearly

In early February, Pat Russo sent a letter addressed to Lucent retirees with information about pension and healthcare benefits.  She also responded to a number of questions from retirees on this issue at the Lucent Annual Meeting earlier this month.  The LRO appreciates the effort Pat expended in reaching out to communicate.  But as the attached "open letter" to Pat Russo states, we believe there are issues that need to be presented more clearly to retirees so they understand the total picture associated with the pension, healthcare and life insurance benefits. 

Based on the questions from retirees that the LRO has received, when all the facts are put together, retirees’ pensions, healthcare and life insurance benefits are a source of considerable concern--as is the governance process that got us to the current state.  Click on these links to read Ken's letters to LRO members and to Pat Russo.  A copy of the letter to Pat Russo has been sent to all Lucent Board Members.
Click here to read Pat Russo's February 2006 letter to Lucent retirees.  

Lucent's Board Has Corporate Attorney Respond To Ken Raschke's Letter

LRO President Ken Raschke has sent letters to the 11 members of Lucent's Board of Directors.  He pointed out that unfortunately, despite the LRO’s repeated requests, Lucent’s senior executives have refused to allow a meeting of independent LRO experts with members of the firm currently auditing the pension fund.  Also, Ken reminded the Lucent Board Members that their vigilance in exercising their responsibilities to all shareholders is both lawfully required and ethically and morally essential.  He urged them to investigate Lucent’s management of the Lucent Retirement Income Plan [LRIP] and Life Insurance Trust.  Ken's November 18, 2005 letter received a response dated December 12, 2005--not from a Lucent Board Member but from William R. Carapezzi, Jr., Lucent's Senior Vice President and General Counsel.  Click here to read Ken's letter.  Click here to read the response from Lucent's attorney.

Ken Raschke's Update On LRO Activities Related To Lucent And Alcatel Merger

LRO President Ken Raschke has written a message for LRO members to inform them about what LRO leaders have been doing related to the impending Lucent and Alcatel merger.  Included in Ken’s message are links to a letter that Ken sent to Lucent Chairman and CEO Pat Russo and Alcatel Chairman and CEO Serge Tchuruk, a link to a letter with Pat’s response and a follow-up letter from Ken to Pat requesting a meeting between the LRO leaders and Lucent executives. Click here to read Ken's message and the letters exchanged between Ken and Pat Russo.

Lucent’s Pat Russo and LRO’s Ken Raschke Exchange Letters

Lucent Chairman and CEO Pat Russo has replied to Ken Raschke’s June 19, 2006 letter requesting a meeting with Lucent executives in order to become better equipped to respond to questions the LRO is receiving from LRO members about the future of their pension and benefits in connection with the impending Lucent and Alcatel merger. Although Ms. Russo declined the request for a meeting due to regulatory rules associated with the Lucent and Alcatel merger, she did offer in her letter that Lucent would consider responding to a “limited number of questions” that retirees may have about the Form F-4 that Lucent and Alcatel filed with the U.S. Securities and Exchange Commission.
Click here to read Ms. Russo’s letter.

Ken sent a letter back to Ms. Russo to thank her for her offer to respond to a few questions. Click here to read Ken’s reply.

 Click here to access the Lucent and Alcatel Form F-4 filing. LRO members are invited to review the F-4 filing and promptly email their questions to the LRO at The LRO will review the questions and send to Ms. Russo the ones that are of greatest interest to retirees.

LRO Board’s View of How Retiree Shareholders Should Vote on the Merger of Alcatel and Lucent

Lucent has begun distributing to its shareowners the proxy proposal for the Alcatel acquisition/merger that will be voted on at a special meeting of Lucent shareowners on September 7, 2006 in Wilmington, Delaware. Click here to read the LRO Board's recommendation for consideration by LRO members who are Lucent shareowners.

LRO President Ken Raschke Sends Questions To Lucent

In Lucent Chairman and CEO Pat Russo's July 13, 2006 letter to LRO President Ken Raschke, she invited the LRO to send a limited number of questions about the Lucent and Alcatel merger. Click here to read the letter and 12 questions that Ken sent to Ms. Russo on July 28. Ken noted in his letter that individual LRO members have different concerns and the questions were framed so that these different concerns of the LRO members and other Lucent retirees are being asked. The LRO wants to thank the LRO members who took the time to submit questions. We regret that only a limited number of questions could be submitted.

LRO Responds to Lucent’s Effort To Discredit LRO Board Member’s Story In The New York Times That Used The Lucent Pension Plan As An Example Of Why Accounting Change Is Needed

The LRO regularly goes to the news media as a way of making its voice heard in an effort to protect the pension and benefits of Lucent retirees.  The latest example of this was in a November 8, 2005 New York Times article whose purpose was to explain an important meeting of the accounting profession to change pension rules.  LRO Board Member Herb Zydney held up for scrutiny the management of the Lucent pension plan as an example of why changes would benefit everyone, including Lucent's shareholders.  Click here to read the article: A Pension Rule, Sometimes Murky, Is Under Pressure.
After the article appeared, the LRO was disappointed to see that Lucent Chief Financial Officer Frank D’Amelio elected to post on Lucent’s website a message to discredit Mr. Zydney’s comments, the LRO and The Times’ reporting.  The LRO believes it is unfortunate that Mr. D’Amelio did not focus on the substance of The Times article—accounting pension reform.  Click hereto read Mr. D’Amelio’s letter. 

The most disturbing part of Mr. D’Amelio’s letter is that Lucent continues to maintain that its pensions remain well-funded under the federally mandated ERISA (Employee Retirement Income Security Act of 1974) guidelines.  Lucent has not answered to the LRO’s satisfaction what is it going to do about the $1.7 billion underfunding of the management pension plan.  The $1.7 billion shortfall is Lucent’s own figure in its filing with the Securities and Exchange Commission based on FASB calculations.   Most pension experts believe FASB calculations provide a more accurate evaluation of the true status of a pension fund.  Many of the pension plans that the PBGC (Pension Benefits Guarantee Corporation) has had to take over were considered fully funded under ERISA rules.  The LRO doesn’t want that to happen to our pensions.

Mr. D’Amelio’s rebuttal is a continuation of Lucent’s tactic to attempt to discredit the LRO after major coverage in the news media of Lucent retirees’ concerns.  A year ago, after the LRO criticized in the press Lucent’s elimination of the health care subsidy for certain dependents, Lucent sent a mailing to management retirees in which it disparaged the work of the LRO to protect pension and benefits.  The LRO responded then with a statement-by-statement rebuttal.  Once again, the LRO will not be silent in the face of Lucent’s charge that the LRO is engaged in an “unjustified campaign.”  Click here to read the LRO’s comments about Lucent’s statements in the article and in Mr. D’Amelio’s letter.  Then, you can decide whether the LRO’s campaign to protect retirees’ pensions is justified.

LRO President Ken Raschke's Letter To SEC

LRO President Ken Raschke to the Securities And Exchange Commission pointing out the unfairness of Lucent and other corporations not accepting a simple majority vote by shareholders as a mandate for action on proxy proposals.  Click here to read Ken's letter.

LRO Attempting To Learn More About Lucent's Medical Coverage Refunds

A number of management retirees have recently received checks from Lucent to refund some of their contributions for medical coverage in 2005.  Lucent's action has raised questions from some LRO members.  In a effort to address those questions and learn details about Lucent's action, LRO President Ken Raschke has sent a letter to Pamela Kimmet, Lucent Senior Vice President for Human Resources.  Click here to read the letter.

Understanding And Protecting Defined Benefit Pension Plans

Recently a great deal has been written in the press about Defined Benefit Pension Plans and proposed legislation in Congress to better protect retirees' pensions.  Click here to read a letter to LRO members on this subject from LRO President Jim Breslin.

Patricia Russo Responds To LRO Request To Place Portion Of Tax Refund Into Health Care Trusts For Retirees

LRO President Ken Raschke sent a letter to Lucent Chairman and CEO Patricia Russo on November 15 (click here). The letter requested that Lucent apply a sizable portion of its $816 million tax refund, plus $45 million in interest, as a contribution to health care trusts for management and represented retirees.  Ms. Russo has responded (click here) that Lucent will use the tax refund for "general corporate purposes" and will not direct any of the money into health care trusts for retirees.  

PBGC Explains Policies In Letter To LRO President

The Pension Benefit Guaranty Corporation has responded to a letter from LRO President Ken Raschke who asked for an explanation of the agency's policies.  Click here to read the letter from the PBGC.


Ken Raschke Sends Follow-Up Letter To SEC

On October 26, LRO President Ken Raschke sent a follow-up letter to the Securities And Exchange Commission.  In this letter (click here) Ken provides the SEC some quantitative support for the LRO's request that the SEC include Lucent in its investigation of practices and policies of major pension funds.

LRO Asks SEC To Examine Lucent Pension Plan

LRO President Ken Raschke has written a letter (click here) to the Securities & Exchange Commission commending the SEC for its investigation in corporate pension plans and requesting a meeting with the Enforcement Division Director to discuss whether Lucent has properly exercised its fiduciary obligations in regard to its pension plan.
In a news release (click here) about the LRO's request, Ken stated: "The SEC is the only authority capable of unraveling the mystery of what has happened to Lucent's pension plan and to issue corrections for needed change," said Ken Raschke, LRO president.  <> “Lucent has rejected our repeated requests to gain an independent audit of the pension trusts.  PricewaterhouseCoopers, the firm that audits both Lucent’s corporate books and the pension trusts, has declined to provide answers.  And, the Employee Benefits Security Administration, the federal agency with ERISA enforcement authority, has been non-responsive to our pleas for assistance.” 

Ken Raschke Continues Exchange of Emails With Henry Schacht; Emphasizes Need For Meeting And Independent Audit Of Pension Trusts

During the past few weeks, Lucent Board Member Henry Schacht and LRO President Ken Raschke have exchanged emails with regard to matters of concern to Lucent and the Lucent Retirees Organization.  In his emails, Ken continued to press for a face-to-face meeting with Lucent executives and an independent audit of the Lucent pension trusts.  Click here to read the four emails. 

LRO Asks Federal Agency To Audit Lucent's Pension and Benefits Trust Funds

The LRO is continuing its efforts to draw the attention of federal agencies to the plight of Lucent retirees.  In mid-June, LRO President Ken Raschke sent letters to Secretary of Labor Elaine Chao and SEC Chairman William Donaldson.  The letters detailed Lucent's rejection of the LRO's request for meetings to discuss proposed agenda items on our health care trusts and the company's denial of the LRO's call for an independent audit of the pension trust fund. The leaders of the two federal agencies were asked what advice or support they could provide to Lucent retirees who want genuine assurance that their pension and benefits trust funds are protected. 
  On July 27, Jack Hardy, SEC Branch Chief, responded saying that he had forwarded the LRO letter to the Employee Benefits Security Administration in the Department of Labor.  Ken used the contact information supplied by Mr. Hardy to send a letter (click hereon August 3 to the EBSA.  Ken closed the letter with a request for the agency to perform an independent audit of Lucent's pension and benefit trust funds. 

 Notice that a copy of the letter was sent to nine individuals with the hope this will add leverage to the LRO's request.   When you are in contact with your elected U.S. leaders in this election year, point out that after seven weeks there has not been a response to the LRO from the Secretary of Labor.  Also, note the importance for retirees to be able to obtain answers from federal agencies to know that their pension and benefit trust funds are secure.

LRO Claims 1913 Document Proves Lucent's Cancellation of Death Benefit Was Inappropriate

The LRO has issued a news release (click here) claiming that a 1913 AT&T document (click here) it has uncovered is proof that Lucent Technologies should not have cancelled the Death Benefit for surviving spouses of retirees.  The news release was issued after LRO President Ken Raschke sent a letter (click here) to Lucent Chairman and CEO Patricia Russo requesting that Lucent self-initiate restoration of the Death Benefit because the language is clear in the 1913 pension and benefits plan that changes shall not be made without the beneficiaries consent.

Ms. Russo responded in a letter (click here) that: "As a matter of policy the company does not comment or discuss pending litigation."  Three class action lawsuits filed by Lucent retirees challenging Lucent's elimination of the Death Benefit are pending in U.S. District Court in New Jersey.

Where Is Theodore Vail Today When Retirees Need Him?

Among the documents uncovered during research for the LRO Documents Library is a January 1, 1913 message from Theodore Vail, the AT&T President who presided over the creation of The Bell System.  Mr. Vail's comments were printed in archived editions of the Bell Telephone News and Western Electric's employee publication.  Click here to read Mr. Vail's statement that launched significant enhancements to The Bell System's pension and benefits plans. 

Mr. Vail's words animated the original AT&T Benefit Plan from its outset and for years and years thereafter. Lucent is surely aware of the history of the AT&T Pension and Benefit Plans. In light of all the cuts in benefits Lucent has ordered, every retiree should ask: How did Lucent's management convert Theodore Vail's words of assurance to mean that benefits once vested can be terminated? Or didn't Lucent know?

Letters Seek Assurance That Lucent Retirees' Trust Funds Are Protected

LRO President Ken Raschke wrote a letter (click here) to Bradley Belt, the Executive Director of the Pension Benefit Guaranty Corporation, seeking what advice or support the PBGC could provide to Lucent retirees who want genuine assurance that their pension and benefits trust funds are protected.  Mr. Belt responded (click here) with some recommendations.  Based on information provided by Mr. Belt, Mr. Raschke sent a letter (click here) to U.S. Senator Judd Gregg, Chairman of the Senate Committee on Health, Education, Labor and Pensions.  A similar letter was sent to U.S. Representative John Boehner, Chairman of the House Committee on Education and the Workforce. 

After reading the letters, LRO members are encouraged to share with their elected representatives their personal views on the importance of retirees being able to gain greater insight into the status of their pension and benefits trust funds. 

LRO Calling Political Leaders' Attention To Retirees' Concerns

In an effort to bring retirees' issues to the attention of America's political leaders during this election year, LRO President Ken Raschke requested that a list of issues be compiled on "Why Lucent Retirees Are Concerned."  Ken has sent a letter (click here) and the 20-page list (click here) to the three presidential candidates and the top Republican and Democratic leaders in the US House of Representatives and Senate. 

A response has been requested from each candidate and the Congressional leaders.  If responses are received, their comments on issues important to retirees will be shared with millions of retirees through the LRO and other retiree organizations' websites.  LRO members are encouraged to use issues on the list in communications with their elected representatives. 

LRO Asks Secretary of Labor:  "What's A Retiree To Do..."

LRO President Ken Raschke has sent a letter to Secretary of Labor Elaine Chao asking the Department of Labor for advice on what the LRO should do to gain genuine assurance that the pension and benefit trust funds for Lucent retirees are secure.  The letter seeking guidance from the DOL was written after Lucent Chairman and CEO Patricia Russo rejected a request from the LRO for an independent audit of the Lucent pension trust funds.

In rejecting the LRO's request, Ms. Russo stated: "PricewaterhouseCoopers LLP (PwC), serves as Lucent's Independent Auditor and performs an annual audit of the records and accounts of our pension plan as required under ERISA guidelines."  PwC is the same firm that audits Lucent’s corporate books.  The LRO believes these simultaneous roles as the auditor of both the Lucent corporate books and the assets of the pension and benefit funds held for retirees have an inherent conflict of interest.  Lucent’s pension fund has assets of approximately $30 billion.  This is equal to roughly twice the company’s market capitalization.

Copies of the three letters were sent to the Wall Street Journal with a request that the newspaper do an article on Lucent's rejection of the LRO's request for an independent audit and the LRO's appeal to Secretary Chao for help.

No matter how many times Lucent says "trust us" on the security of our pension and benefit trust funds, the LRO will continue to seeks ways to gain an independent evaluation that the trust funds are secure and being managed properly. Click here to read the letter to the Secretary of Labor followed by the letters exchanged between Mr. Raschke and Ms. Russo.

LRO Urges SEC To Include Shareholder Nominees For Directors In Proxy Process

The Securities and Exchange Commission is in the process of making a decision on what could be one of the most important reforms to be adopted by the SEC.  Under consideration is a proposal to require companies to include shareholder nominees for corporate directors in the proxy process.  Click here to read LRO President Ken Raschke's letter to the SEC.

LRO Sends Letter To SEC Seeking New Rules For Pension Fund Managers 

The LRO has sent a letter to the Securities and Exchange Commission (SEC) requesting that pension trust fund investment managers come under the same rules that the Commission is considering for mutual fund investment managers.  The letter was written by LRO Board Member Herb Zydney, who is Acting President while Ken Raschke is on vacation.  Click here to read the letter.  Shorter versions of the letter were sent to Secretary of Labor Elaine L. Chao and Senator Richard C. Shelby, Chairman of the U.S. Senate Committee on Banking, Housing and Urban Affairs.

LRO President Ken Raschke's Message To Henry Schacht

As a follow up to Henry Schacht's meeting with LRO leaders on November 3, LRO President Ken Raschke has sent a letter and a revision of the LRO's Mission and Principles to the former Lucent Chairman and current Board member.  Click here to read the documents.

LRO President Asks SEC To Investigate Aetna President's Appointment To Lucent Board

Ken Raschke has sent a letter to SEC Chairman William H. Donaldson requesting that the SEC investigate whether it was appropriate for Lucent Technologies to appoint the President of Aetna, Ronald A. Williams, to its Board of Directors since Aetna will be only one of two health care insurance providers for Lucent retirees in 2004.  Click here to read the letter.

Exchange Of Views Among LRO Representatives, Henry Schacht & Accompanying Lucent Officers

On November 3rd, Henry Schacht, previous Lucent Chairman and CEO and currently a member of the Lucent Board of Directors, came to Greensboro, NC for a third meeting with several LRO officers and volunteer specialists.

LRO Second Meeting with Lucent Executives

This focused on health care issues. Lucent has agreed to respond to a Q&A sent following the meeting.

Health care, death benefits, and pensions (May 20, 2003)

LRO First Meeting with Lucent executives (April, 2003)



LRO Activities Archives

The NRLN’s Role in Health Care Reform

Congress and the White House made it clear at every turn that health care reform was about making health care insurance available to those who did not have it, but not about retirees whose health care benefits were being eroded. Despite their declared position, the NRLN pursued changes that would protect and secure health care benefits for retirees. Read more...

LRO Board Adopts Goals For 2009

The Lucent Retirees Organization Board of Directors has adopted the LRO Goals for 2009. The Board seeks the support of LRO members in its efforts to accomplish the goals.

LRO Has Chapter In Georgetown University Dissertation

The Lucent Retirees Organization has a chapter in a dissertation written by David Lawrence Madland in partial fulfillment of the requirements for his Doctor of Philosophy degree from Georgetown University. The title of the dissertation is "A Wink and A Handshake: Why the Collapse of the U.S. Pension System Has Provoked Little Protest."

The dissertation examines the reasons why cuts to pensions and other employer-based retirement benefits in the United States have provoked relatively little protest from those who have been harmed. Through case study and survey analysis, the dissertation argues that people have rarely protested because they haven't been mobilized into action by an organization and have ideological concerns about government intervention in the economy. As a result, they have low expectations for the success of protests. In making this argument, the dissertation deepens understanding of the concepts of ideology and ambivalence, as well as provides a needed corrective to the standard Social Movement Theory account of collective action.

The title of the chapter dealing with the LRO is “Retiree Health Benefit Cuts at Lucent Technologies.” It begins on page 148. Click here to read the dissertation.

LRO Members Address Questions To Pat Russo During Lucent's Shareowners Meeting

During the 45-minute question and answer segment at the end of Lucent's annual shareowners meeting on February 15, 2006 in Wilmington, DE, LRO board members and members who are Lucent shareowners asked Pat Russo as many questions as time allowed.  The microphone for the questions had to be shared with a number of other shareowners. The LRO has captured from the Lucent webcast the LRO questions and Lucent's responses on the security of Lucent pensions, health care and life insurance benefits.  To listen to the questions and Ms. Russo's response, click on the following links. (If you have Windows Media Player or other audio software it will take several seconds to a few minutes for each audio clip to load, depending on the speed of your Internet connection.)

Bill Kadereit's question Bill, LRO Legislative Affairs Director, questioned Ms. Russo about management pension funding and future plans for health care for management and formerly union represented retirees.

Paul Bayliss' question  Paul, LRO New England Regional Director, asked about the $1.2 billion underfunding of the management pension plan based on FASB calculations that Lucent reported to the SEC on December 14, 2005.  This question was mostly answered by Frank D'Amelio, Lucent COO and CFO.

Walt Ehmer's question Walt, LRO Southeast Regional Director, asked about pension reporting - FASB vs. ERISA. Telephony magazine reported " Russo seemed noticeably perturbed at one point when a retiree [Walt] asked her why the company has described its pension plans as adequately funded despite a more than $1 billion deficit in the management pension plan."

Jim Stickel's question  Jim, a Bell Labs retiree who submitted one of the proxy proposals, asked Ms. Russo about the future security of Lucent's life insurance benefit.

Ed Prescott's question  Ed, a Zionsville, PA retiree, questioned why the base compensation for the Lucent Board of Directors was being increased from $125,000 to $165,000 annually. 

Lucent Retirees Organization Reaches 10,000-Member Level

The Lucent Retirees Organization registered its 10,000th member on April 8, 2006.  Registrations have surged to twice the normal level since news of a Lucent and Alcatel merger first appeared on March 24.  The LRO received its charter as a non-profit organization in January 2003.  Reaching the 10,000-member level in a little over three years is considered a significant accomplishment by most retiree organization standards.

While this is a major milestone, the LRO recognizes there is more recruiting work to be done to gain a higher membership percentage of the 114,000 Lucent retirees.  Existing members are urged to invite their former co-workers to become LRO members.  Individuals may register by going to the LRO website  and clicking on the "Join Us" icon.  Registration can also be accomplished by mailing dues and contact information to: The LRO, P.O. Box 1535, Cranford, NJ 07016-1535.  Dues are $25 for annual membership or $350 for lifetime enrollment. 

Lucent Retirees' Proxy Proposals Receive Majority of Votes Cast At Lucent Annual Meeting

In recent years, Lucent Technologies Inc.'s retirees have seen many of their benefits cut. Now they are fighting back -- proposing to rein in the compensation of the executives doing the cutting.

Lucent's shareholders today are voting on a proposal to restrict the pay of the top brass. The proxy proposal, which was put forward by retirees, would make 75% of executive stock grants dependent on the telecom-equipment maker's performance. It is partly a reaction to last year's sharp increase in the bonus of Lucent's chief executive, Patricia F. Russo.

The LRO-sponsored proxy proposals both received a majority of the votes cast at the Lucent Annual Meeting.  Joanne Raschke's proxy proposal received 54% of the votes cast while Jim Stickel's proxy proposal received 53% of votes cast.  Mrs. Raschke's proposal requested that Lucent adopt a policy whereby at least 75 percent of future equity compensation (stock options and restricted stock) awarded to senior executives be performance-based and the performance criteria adopted by the Lucent board be disclosed to shareowners.  Stickel's proxy proposal requested that the Lucent board use a measure of earnings that excludes pension accounting credits from the calculation of performance-based compensation for Lucent executive officers.  These non-cash "pension credits" result from projected (not actual) returns on pension fund assets and are not available for operating purposes or pay dividends.

"We are delighted that the majority of the Lucent shareholders who voted decided to support our proposals," said Ken Raschke, LRO President.  "The essence of our American democracy is that the majority of those who vote determine the outcome of an election.  We hope the Lucent Board will implement our proxy proposals as corporate policy since the majority of Lucent's voting shareowners have revealed their position.  It would be un-American for the Lucent Board not to adhere to their shareowner's wishes."

Click here to read the Wall Street Journal Article.

LRO-Supported Proxy Proposals Will Be On Lucent's 2006 Annual Meeting Ballot

Joanne Raschke, wife of LRO President Ken Raschke, and LRO Member Jim Stickel have received notices from Lucent that their LRO-supported proxy proposal will be on the ballot at Lucent's 2006 Annual Meeting. The meeting will be held February 15, 2006 in Wilmington, Delaware.

Joanne's proxy statement, if passed, would require Lucent to adopt a policy whereby at least 75 percent of future equity compensation (stock options and restricted stock) awarded to senior executives be performance-based.  And the performance criteria adopted by the Lucent Board would be disclosed to shareowners. That proposal received 50.2% of the votes cast at the 2005 Lucent Annual Meeting, but it did not pass because the company counts abstentions as votes against shareholder proposals.

Jim's proxy statement, if passed, would require future awards of performance-based compensation for Lucent executive officers to use a measure of earnings that excludes non-cash "pension credits" that result from projected returns on employee pension fund assets.  And Lucent would have to report annually to shareholders on the specific financial performance measure used to award performance pay. Last year "pension credits" provided 98% of Lucent's reported net earnings in 2004 -- an accounting gimmick that gives management a personal incentive to reduce retiree benefit costs. 

If you own Lucent stock, be sure to vote your shares in favor of these proposals.  Click here to read the 2006 proxy proposals.

Documents LRO Leaders Used In Meetings With Lucent Executives

For LRO members who are interested in reading the handouts and other documents relating to the LRO leaders meetings with Lucent on January 14 and August 16, 2005, please click here to access this information.

Summary of LRO Board Minutes

The LRO Board has posted a summary of its minutes from its semi-annual meeting in Greensboro, NC on September 16 and 17, 2005.  Click here to read the document. 

LRO And Lucent Leaders Meet For Third Time This Year

Representatives from the LRO and Lucent met on August 16 for the third time this year in Murray Hill, NJ.  LRO leaders Ken Raschke, Chuck Graves, Bill Kadereit and Herb Zydney are analyzing the information received from Lucent in the three-hour meeting and will prepare follow-up requests. Click here to read the report by LRO President Ken Raschke on the LRO team’s perspective on the meeting.

LRO Makes Presence Felt At Lucent Annual Meeting

Nine LRO members who are Lucent shareowners attended the Lucent Annual Meeting on February 16 in Wilmington, Delaware.  Two of the LRO members and the wife of a third made presentations on why their proxy proposals should be supported. When the tabulation of the ballots was announced, the LRO-sponsored proxy proposals had not garnered enough votes to pass.  Click here to read more about LRO members' participation in the Lucent Annual Meeting.

LRO And Lucent Executives Meet And Agree To Work Together On Issues Important To Retirees

Representatives from the LRO and Lucent met on January 14, 2005 at Lucent’s Murray Hill, NJ Headquarters.  The meeting was an effort to begin the process of exchanging meaningful information that will hopefully rebuild retirees’ confidence in the security of their pensions and understand the financials associated with health care coverage, life insurance and prescription drug benefits. (Click here to read the entire LRO report on the meeting.)

LRO Sets The Record Straight On Lucent’s “Facts” Mailing

Management retirees received a mailing from Lucent in November 2004. The LRO wants Lucent to communicate important information to its retirees.  However, to the LRO the “Facts” sheet reads as a calculated effort to discredit and neutralize the LRO’s efforts to protect retirees’ pensions and prevent the further erosion of health care benefits.  After careful consideration of Lucent's document, the LRO Officers have concluded the mailing was filled with generalities that did not provide concrete evidence to support Lucent’s contentions that:
--the pension plan is secure,
--health care costs are prohibitive,
--executives’ compensation is justified, and
--the mission of the LRO is contrary to the interests of retirees.

To read the LRO response to Lucent's mailing, click here.

The mailing was done by Lucent with full awareness that it controls the list with retiree’s names and addresses. Therefore, we ask our members to printout the LRO’s response to the mailing (click here for a printable copy) and share it with their former co-workers who do not receive LRO emails or access the LRO website. When you share this information with them, please encourage them to become an LRO member and to send a check for $25 dollars to the LRO for annual dues to help in our collective efforts on behalf of retirees.

With the attack on the LRO by Lucent, it is clear retirees need a strong voice to advocate their rights.  It is through your dedication and financial support that we’ll be able to accomplish our mission to preserve and urge the enhancement of pension, healthcare and other benefits earned by retirees.  And, to the extent consistent with retirees’ interests, we will help strengthen Lucent to the best of our ability. 

LRO Members Send Their Responses To Lucent's Facts Mailing

LRO members are writing letters to Lucent in response to Patricia Russo's letter and the accompanying "Facts About Lucent Retiree Healthcare and Pension Plans."  Click here to read the letters.

Lucent Will Use New Law To Distribute Increased Costs Of Health Care To Retirees

Although LRO members flooded Congressional offices with emails in an effort to stop the Lucent-sponsored Section 719 in the new tax bill, the legislation passed and is headed for an expected signing by President Bush.  A reporter for The Wall Street Journal has dug into what the provision will mean to retirees from Lucent and other large companies.  According to the article, the new law will allow Lucent to distribute increased costs of health care across the entire management retiree population.  And the provision could also apply to union-represented retirees going forward. 

LRO Board Spends Two Days Focusing On Pension And Benefit Issues

The LRO Board met in Greensboro, NC on September 17 and 18, 2004 with its prime objective focused on ensuring the viability of the Lucent pension fund. This included gaining advice from a prominent ERISA legal authority as to what future actions might be taken on behalf of all retirees. Click here to read the summary report on the meeting.

Retired Lucent Shareholders File Three Proxy Proposals

Raise Company's Performance And Accountability Standards

With support from the LRO, a group of retired Lucent shareholders who want to set higher performance and accountability standards for their former employer have filed three proxy proposals to address present shortcomings.

The LRO has issued a news release (click here) announcing the filing of the proxy proposals with Lucent.  The three proxy statements (click here), intended for a vote by Lucent shareholders at the company’s annual meeting in early 2005, focus on establishing auditor independence, requiring performance-based executive stock options and limiting golden parachute packages.

Lucent Adopts LRO-Sponsored Proxy On Severance Policy

The Wall Street Journal reported on May 6 that Lucent disclosed that it will seek shareholder approval in the future for some severance agreements.  This is in response to 65% of the shareholders at the annual meeting voting in favor of the proxy sponsored by the LRO.  The LRO will monitor the application of the policy to make sure that the proxy is administered as the LRO intended it should be.  Click here to read The Wall Street Journal article.

LRO Officers and Directors gathered in Dallas on March 26 and 27

to review LRO survey results, evaluate first-year accomplishments, report on audits of Lucent’s pension and health care trust filings, reaffirm previous objectives and formulate new goals and strategies for 2004.  Click here to read the full report on the meeting.The single message the LRO wants to convey in this report is that we are making progress.  We will extend every effort, persist in every initiative, and employ every resource in championing the rights of our members.  This, you want us to do.  And this we pledge.

If you send a response to the LRO about this report, please note your home state so your response can be forwarded to your Region Director.

LRO Members Express Their Opinions In LRO Survey

In preparation for the LRO leaders' annual planning meeting at the end of March, an email survey was sent to LRO member asking their opinions on a number of issues. One of the things asked of members was to identify their most important concerns that they wanted the LRO to work on.Click here to read dozens of comments from LRO members.

The comments (without names) are shown exactly as they were written (except for a few spelling corrections). Quotation marks are at the beginning and the end of each individual's statement. The LRO leaders found the feedback from the survey very valuable and they want to thank the members who responded.

LRO Survey Responses Provide Priorities For Future Actions 

The LRO Board of Directors wants to express its appreciation to the 3,742 LRO members who completed the online LRO opinion survey.  The high response rate of 43.4% of LRO members with Internet access has provided the LRO with very good insights into issues important to LRO members.

The data from the survey was the focal point of the LRO Board members’ planning meeting in Dallas on March 22 – 24.  Hours were spent on presentations and discussions about the responses in the survey and how the data should guide the LRO’s priorities in the future.

In addition to the posted results, there were over 1,000 comments and suggestions from members. While these are too numerous to post, we will be addressing many of these issues in future emails and LRO Newsletter articles.  One area where suggestions have already been adopted is in the new design of the LRO website. 

Feedback In LRO Survey Provides Valuable Input For 2004 Objectives

Feedback received from members in the LRO Survey was in the forefront of LRO leaders' thoughts when they met in Dallas on March 26 and 27 to set objectives for 2004.  If you have read the report about the meeting posted on the LRO website, you may have recognized some of your input. In addition, there have been a number of items added to the LRO website due to requests made in the survey.  Click here to read a summary of the survey results.

If you send a response to the LRO about this report, please note your home state so your response can be forwarded to your Region Director.

Walt Ehmer's Report On Lucent's Annual Meeting- 2/21/04

click here to read report and questions asked


Items from Lucent for the LRO

Alcatel-Lucent Informs LRO Of Error In Open Enrollment Materials

Alcatel-Lucent has informed the LRO that there is an error in the open enrollment materials (Alcatel-Lucent Information and Action Guide for Management Plan Design Retirees). The sentence, "If you retired before 3/1/90 and you waive medical coverage, you will also be waiving dental coverage." on page 24 should not have been there. If you waive medical coverage, you can still elect dental coverage. This is true for both pre- and post -3/1/90 retirees. Alcatel-Lucent apologizes for any confusion.

If you opt out of Alcatel-Lucent coverage for 2009, you may opt in during open enrollment for 2010. As a pre-3/1/90 retiree, you would not be responsible for a monthly premium. At this time, Alcatel-Lucent expects to again offer the SecureHorizons MedicareDirect option to Medicare-eligible retirees for 2010.

LRO Gains Important Information From Alcatel-Lucent To Aid With Health Care Decision For Medicare Retirees

LRO President Andy Guarriello sent an email to Alcatel-Lucent Human Resources, stating the following: "Some people have received their "yellow" envelopes and have emailed me that they do not see any reference to or statement to the effect that they are losing their group plan and are eligible for guaranteed issue coverage. Are they missing it or is it just implied. If implied how would they show a potential Medigap provider that they have guaranteed issue rights?"

ALU responded as follows: "Retirees who will no longer have access to Alcatel-Lucent's Traditional Indemnity option are considered to be losing their current Alcatel-Lucent group plan coverage, and are eligible for guaranteed issue Medicare Supplement coverage. Retirees eligible for guaranteed issue are entitled to a Medigap plan without medical underwriting, and freedom from preexisting condition exclusions."

Retirees are correct that there is no reference in the open enrollment materials to the impact of their losing their group plan coverage. Medicare Supplement plans are regulated at the state (and not federal) level, and therefore, the rules will vary by state. Therefore, all retirees are encouraged to check with their states' insurance departments for specific information.

"Retirees should advise the Medicare Supplement plans they are investigating of the situation with their current group coverage (they can refer to their open enrollment materials). We are not aware of a Medigap plan requiring written documentation of losing group coverage."

This is a one-time opportunity for guaranteed issue to access a Medigap plan without being limited by a preexisting condition. Congress is considering Medicare legislation that would mandate changes in how doctors and hospitals are chosen for group Medicare Advantage Private Fee-for-Services health care plans such as the SecureHorizons MedicareDirect plan being offered by Alcatel-Lucent.

Alcatel-Lucent Responds To LRO's Request For More Information On Merger Of Pension Plans

John Hickey, Alcatel-Lucent Human Resources Vice President for Compensation and Benefits, has responded to LRO President Ken Raschke's letter requesting additional information about the company's action to merge Alcatel USA retirees into the Lucent Management Pension Plan (the Lucent Retirement Income Plan - LRIP). The LRO will ask its legal counsel who is well versed in USA pension laws to review Mr. Hickey's response and the document he attached to his response.
 Click here to read Mr. Hickey's email.

 Click here to read the Alcatel USA, Inc. Consolidated Retirement Plan document.

Alcatel-Lucent Issues Letter About Prescription Drug Coverage And Medicare

Medicare-eligible Lucent retirees have been sent a letter from Alcatel-Lucent with information about their Alcatel-Lucent prescription drug plan and their options under Medicare's prescription drug coverage. 

At the end of the letter, recipients are reminded to keep the notice because if they decide to join one of the Medicare prescription drug plans, they may be required to provide a copy of the notice when they join to show whether or not they have maintained "creditable coverage" and whether or not they are required to pay a higher premium/penalty. Click here to access a copy of the letter. 

Alcatel-Lucent Attorney Responds To LRO's Concerns About Lost Personal Information

On May 27, 2007, LRO President Ken Raschke emailed a follow-up letter to Alcatel-Lucent CEO Pat Russo about Lucent retirees' concerns over the lost personal information and offered recommendations and assistance on the issue from an LRO Board member with expertise in personal information security (see letter at

Alcatel-Lucent General Counsel Steve Reynolds responded with an email to Ken on May 29, 2007. He basically recapped the Alcatel-Lucent information that the LRO has already distributed to its members and said nothing about the LRO's recommendations and offer to provide expert assistance. The letter noted that Alcatel-Lucent is "Sending a letter by mail to all former Lucent employees and retirees and their adult dependents informing them of what has happened and information about the credit monitoring services we have arranged for them." Mr. Reynolds did not indicate when the letter would be forthcoming. Click here to read Mr. Reynolds entire letter.


Alcatel-Lucent's Notification On Loss Of Personal Information

Alcatel-Lucent has asked the LRO to assist in the notification that a computer disk containing some personal information on U.S. employees, retirees and their dependents has not been located.

The disk contained personal information including name, address, Social Security number, date of birth, and salary information for Alcatel-Lucent U.S.-paid employees who worked for Lucent, their dependents and Lucent’s retirees and their dependents. This disk did not include any credit card numbers, bank account numbers, password information or information about employee savings plan accounts, stock option accounts or pensions.

As part of the company’s regular business, Alcatel-Lucent uses certain record retention providers and benefits consultants to assist with its employee and retiree programs. Alcatel-Lucent learned last Monday, May 7, from one of its vendors that a computer disk containing some personal information could not be located. The disk was prepared by Hewitt Associates for delivery by UPS to another of the company’s vendors, Aon Corporation. Alcatel-Lucent is still investigating this matter, but believes the disk was lost or stolen between April 5 and May 3.

Although Alcatel-Lucent does not have information that any of the personal information has been misused, the company reports it is committed to making sure you have the support you need to monitor your credit and know how to respond if you identify any problems. Alcatel-Lucent is in the process of finalizing arrangements to provide you and your dependents with identity theft protection and credit monitoring for one year free of charge. These services will include unlimited online access to your credit report and score, monitoring of all three national credit bureau reports, email alerts to inform you of key changes to your credit report, and fraud resolution and assistance.

Click here to read Alcatel-Lucent's letter on this subject.

 Click here to read Alcatel-Lucent's Q&A.

Alcatel-Lucent Issues Additional Q&A's On Computer Disk With Personal Information

Based on questions that Alcatel-Lucent has received, the company has issued additional Q&A's about the missing computer disk with personal information on Lucent USA employees, retirees and their dependents. Click here to read the Q&A's.

Lucent’s Questions & Answers On Alcatel Merger

Lucent Explains Investments Allocations For Its Pension Plans

Recently, Lucent announced a change in its occupational pension plan asset investment allocations, going from a 75% equities and 25% fixed income mix to an allocation of approximately 50% equities and 50% fixed income. LRO President Ken Raschke requested from Lucent a clarification about news reports on this subject. He received a response that explained that the allocations for the management pension plan has not changed and remains a 75/25 mix of equities and fixed income, respectively. Click here to read Lucent's response from Mary Lou Ambrus, Vice President - Public Relations.

Pat Russo Responds To LRO's Questions

In an August 16, 2006 letter, Lucent Chairman and CEO Pat Russo has responded to the 12 questions that LRO President Ken Raschke sent to her in his July 28 letter. The LRO appreciates the time that Ms. Russo and her staff devoted to responding to the questions and we hope to keep the communications channels open with Alcatel Lucent following the acquisition/merger. Although some of the responses fall short of the information the LRO hoped to gain, a number of the responses provide important insights into Lucent's possible future plans on retirement issues. Click here to read Lucent's responses to the LRO's questions.

Lucent’s Questions & Answers On Alcatel Merger

Click here to read questions and answers about the Lucent and Alcatel merger posted by Lucent on May 8, 2006. The information is arranged by topic and drawn from several sources, including the All-Employee Broadcast with Pat Russo on April 4, and the Town Meeting with Frank D'Amelio on April 3. Also included are frequently asked questions that were prepared for the merger announcement. Some questions won't have an answer until the integration process moves ahead or the merger is complete.

Alcatel’s Form F-4 Registration Statement Filed With SEC On May 9, 2006

On April 2, 2006, Alcatel and Lucent announced that they entered into a definitive merger agreement.  Click here to read Form F-4 filed by Alcatel with the SEC on May 9, 2006. The form includes the Preliminary Proxy Statement for Lucent's upcoming Special Shareholder Meeting. 

Lucent Leadership Transitions*

October 1, 1996 – Chairman & CEO – Henry Schacht
October 1, 1996 – President & COO – Rich McGinn
October 10, 1997 – CEO – Rich McGinn
January 20, 1998 – Chairman & CEO – Rich McGinn (Schacht retires, continues as Board Member) October 23, 2000 – Chairman & CEO – Henry Schacht (Schacht returns after McGinn's resignation)  January 7, 2002 – President & CEO - Patricia Russo 
February 19, 2003 – Chairman & CEO – Patricia Russo  (Schacht retires again, continues as Board Member)

*From Lucent Press Release Archives

Viewgraphs Used By Henry Schacht In Meetings With Lucent Retirees - Fall 2003

Click here to see the viewgraphs used by Lucent Board Member Henry Schacht during his 10 meetings across the country with Lucent retirees in September and October 2003.

Lucent Responds To Questions From LRO Members.

Questions & Answers From Henry Schacht's Meetings - October 2003

Lucent retirees had many questions for Lucent Board Member Henry Schacht when he held 10 meetings with retirees across the nation in September and October of 2003.  

Lucent Refuses To Meet With LRO About Healthcare And Trust Fund Issues

Following months of extensive research and data gathering, the LRO sent proposed agenda items on May 10, 2004 to Lucent’s leadership requesting meetings on two issues of utmost importance to Lucent retirees.  The LRO contended that the proposed agenda items required one face-to-face meeting on healthcare issues and a separate meeting to gain deeper insight into the management of retirees' pension and healthcare trusts.

The LRO believed that Lucent should be willing to have a dialogue with the LRO on the proposed agenda items.  The LRO hoped that frank discussions between LRO officers and Lucent executives might clear the air and provide a better understanding on a number of critical issues.Lucent turned down the LRO’s good-faith effort to schedule the two meetings. 

 Instead, Lucent executives, lawyers, public relations staff members and possibly others jointly drafted a response to each of the proposed agenda items.  The LRO is extremely disappointed that Lucent leaders elected to hide behind its written corporate spin rather than face us in a candid discussion.

Because Lucent is unwilling to engage in a constructive dialogue, the LRO has no choice but to try to gain answers through other means, including the news media, regulatory bodies, government leaders and by possibly employing accounting and legal experts to provide us guidance.  As you can appreciate, advice from qualified experts would be expensive.  Therefore, we need the help of LRO members to recruit new members so their added dues and contributions will help provide the financial support necessary to dig deeper into the issues that Lucent has refused to discuss with us.

If you are appalled by Lucent’s unwillingness to meet with the LRO and are disturbed by the general nature of the written responses, you may want to talk with or write to your U.S. Senators and Representative to express your personal views that there needs to be more specific rather than broad accountability by corporations on how they are handling trust funds and healthcare benefits.

We believe that LRO members should understand the agenda items proposed by the LRO and be informed of the responses from Lucent.  Therefore, we are posting both along with the LRO’s reaction to each of the responses. Click here to read the exchanges between the LRO and Lucent.

Lucent Discloses Pension Governance Process and Fund Performance November 11, 2003

Lucent Responds To Three LRO Questions Submitted At Annual Meeting

If you read Southeast Region Director Walt Ehmer's report on Lucent's February 18 Annual Meeting, you'll recall that the LRO submitted questions in writing to Lucent since there was not enough time to ask the questions from the meeting floor. Click hereto read responses to three of the questions submitted. The LRO considers Lucent's answers evasive, incomplete and self-serving!

Henry Schacht Responds To Letter Stating LRO's Overview & Guiding Principles

Henry Schacht, Lucent Board Member, has responded to LRO President Ken Raschke's December 9, 2003 letter in which the LRO's Overview and Guiding Principles were stated. To read Mr. Schacht's reply, click here page1, page2

Lucent Responds To Questions On Benefit, Pension And Management Issues

Prior to Henry Schacht's meeting with Lucent retirees in Lisle/Naperville (Chicago area), Don Boulter, a member of John Woodruff's North Central Region Team, sent a list of questions to Lucent.  Click here to read Lucent's responses to the questions on Benefit, Pension and Management issues.10/10/03

Lucent answers an extensive list of your questions.

These answers cover benefits, revisiting retirees choices following the cancellation of benefits, and many specific details about pension plans and retirees. Lucent answered these questions quickly and, in many cases, completely. If the Q&A brings more questions to mind, please use this web site to bring them to our attention.  7/15/03

Lucent Position - Elimination of the Death Benefit

Many retirees have written to Lucent to protest the elimination of the death benefit. Pat Russo's letter to Lucent Retirees, with an  explanation of changes to health and death benefits. Click on the page numbers to read the letter >> [Page1] [Page2] [Page3] [Page4]



(Click on headline to read letter)

Art McCrea Relates Frustrating Experience In Switching Prescription Drug Plans

Art McCrea, who retired in 1989 after 38 years with Bell Labs and AT&T in New Jersey and now lives in Frederickburg, TX, has shared with the LRO how difficult it was for him to communicate with the Alcatel-Lucent Benefits Resources Center (Hewitt Associates) and impossible to communicate with the Alcatel-Lucent Human Resources organization. Click here to read the details of Art's frustrating experience.


LRO Member Eli Shaff's Letter To Alcatel-Lucent Human Resources Vice President 11/15/07



C. R. Farris Sends Email To Pat Russo With His Views On Loss Of Disk With Personal Information  5/18/07


Pete McCarthy, LRO Mountain Region Director, Has Sent Letter To Editor At The New York Times 3/07

Don Jensen, LRO Arizona State Leader, Sends Letter-to-the-Editor at Arizona Daily News.

LRO Members Share Their Comments On Increased Lucent Healthcare Costs For 2007
A number of LRO members have shared their comments on the increased costs of Lucent healthcare insurance premiums for 2007. And in some cases they have described how much the increased cost will erode their Lucent pension, creating a financial hardship. Click here to read their email messages to the LRO. If other LRO members want to add their story to these, please email your comments with your name, phone number and city where you live to Ed Beltram, LRO Communications Director, at

Leroy Terry, a Shreveport Lucent retiree, Had His Letter Published In May 2006 Issue of the AARP Bulletin

Eli Shaff, LRO Secretary, Sends Email to Pat Russo Asking "affordable" to Whom on Health Care Costs

Denver Retiree Dick Kemp responds to WSJ Article: 'Alcatel's Merger With Lucent Stirs Cultural Questions'

Howie King Sends Joe Parano's Obituary to Pat Russo With Some Comments

LRO Member Ed Prescott Shares His View On Lucent's Annual Shareholders Meeting.

LRO Arizona Leader Don Jensen Writes Editor About Broken Healthcare Promises

Spotswood New Jersey Retiree Sends Letter To Pat Russo

LRO Member Cautions Retired Friends After Delphi Bankruptcy Announcement

LRO Member States His Views In Letter To LRO Leaders - 1/05

Hal Worley's Letter To Winston-Salem Journal - November 15, 2004

Oklahoma City Retiree Troy Segler Sends Email To Lucent Leaders - October 15, 2004

Jim Stickel Sends Letter To Patricia Russo Requesting Independent Audit of Pension Trusts  10/13/04

Susan Gibson Emails Henry Schacht Over Tone Of His Email To Ken Raschke  9/28/04

Merrick Cohen Engages Patricia Russo In Email Exchange 9-24-04

Don Steiner Asks CNBC Newsmen To Investigate Lucent's Refusal To Allow Independent Audit Of Pension Trust -September 23, 2004 

Retiree's Wife Sends Letter to D'Amelio and Russo - 9-13-04

Lou Dietrich Shares Emails Exchanged With Patricia Russo  - 9/11/04

Jim Peltier Is "Uncomfortable And Untrusting" Of Pension Fund Management

Patricia Russo Delegates Response To Retiree's Heartfelt Letter

Geraldine "Jerry" Mauck, an Oklahoma City Works retiree, wrote a heartfelt letter to Lucent Chairman and CEO Patricia Russo about her "deep concern about continuing to receive my monthly pension checks."  Click here to read the text of Ms. Mauck's letter that was handwritten.  Ms. Russo delegated the response to Ann Curovic in Lucent's Benefits & Equity Operations.  Click here to read Ms. Curovic's response.

Merrick Cohen Exchanges Emails With Lucent's Patricia Russo- 8/4/04

Joe George Explains Why He Joined The LRO

LRO Member Demonstrates Belief in LRO with $500 Contribution