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2001 Straight Talk Archives

Rumor About D 24/37

Rumor has it that . . . Sears is to announce this week the elimination of the custom drapery and the carpet departments. Total lay-offs, including sales, buying, installation - about 1500.
__________________________________________________________________

Editor's Comment: If this report proves true, it's very sad day. D/37 had been downsized under Martinez's regime. The turnover in the sales force left few knowledgeable personnel which made costly mistakes until trained. The department lacked excitement, a saley atmosphere, and traffic and transaction producing items. We used to "own" the carpeting business which is now rapidly being taken over by Home Depot and Lowes. We were once second behind Penney's in Custom Drapery. Based on personal experience, I doubt if a monitored successful lead program was in force in D/24C. It hurts to see them go!

Another Comment: D/37 was destroyed long before Martinez ... it was destroyed by the Monitor Group (one of those idiot MBA consultant groups the company brought in to save Sears) ... in 1987 they convinced senior management that the way to make profit was to avoid owning any inventory and to shift as much expense onto the sources as possible ... (like the sources weren't going to overbill for all this service) ... so they convinced Sears management to:

1)  discontinue all of Sears proprietary carpet lines
2)  toss $3 million worth of carpet samples into the garbage
3)  close Sears 3 distribution centers
4)  sell only factory cut order, open line merchandise

The problem with this approach was:

1) Sears lost the very effective good, better, best marketing ability that they depended upon for success

2) Sears average cost of goods increased 28% ... exactly the number I predicted before the conversion

3) Sears lost most of their 2,500 installed salesmen who rebelled at the notion

4) Sears found itself trying to sell the exact same merchandise as the competition ... but Sears MU was 42% while the competition was selling at 30%

5) Sears still tried to make 28% on top of the installation charges while competition charged installation at cost

Further, Monitor Group convinced Sears management to liquidate inventory of the very lucrative Decorator Rug line which had a Markup on Receipts of 78% .... by selling their inventory to a third party who warehoused and distributed it for them ... and then charged it back to them at 20% higher cost than Sears had originally paid for it.

The result ...

1) Sears installed carpet business dropped from close to $500 million in 1988 to less than $200 million

2) Sears Decorator, Colonial and Accent rug business dropped from over $60 million to less than $20 million

Alternatively, at the same time the Monitor Group was giving such bad advice to Senior Management, D/637 (me) offered a plan to close its three existing distribution centers ... because all were located in high cost, high expense locations and were operating at 17-21% of the cost of goods ... and build a single new facility in North Georgia, close to all mfgs in Dalton,GA ... which would have operated at 7% of the cost of goods ... the site had been selected and area political leaders had promised everything from site preparation and roads to tax holidays to utility installation to you-name-it .... for the jobs such a facility would produce for the area.

1) Sears would have maintained its proprietary good-better-best product structure

2) Sears would have enjoyed the quantity cost advantages legally available (about 30% less than competition)

3) Sears would have maintained it professional sales force

4) Sears installed carpet would have been competitively priced for the consumer AND profitable to the company

In addition, a secret study was undertaken by D/637 (me) in 1987 and a recommendation was made to Senior Management to purchase Color Tile ... which would have added their $500 million non-competing hard surface business to Sears $500 million soft surface business thus creating an unassailable $1 billion floor covering super store ... Senior Management said Color Tile was too "pipe rack" looking (they were far prettier than Sears at that time) and declined ... a month later they bought Western Auto!!!!!! Go figure!!!!!!!

As much as I'd like to tar Martinez with this brush, and as much as I hate the *&^#%$!#!, THIS debacle had its roots in a prior time ... and ... I told them so!

When is Sears going to learn that every dollar you take OUT of the net cost of goods goes right to the bottom line ... if you force sources to absorb more and more of the cost of doing business, they are going to load their profit factor on top of the cost to provide those services and they WILL overbill the cost of the product to reflect this ... the key to making profit is to MANAGE ALL the costs of doing business better than the other guy ... Sears is now so far behind in this that even if they woke up to the fact they would not survive ... too bad ... I told them so! ... but I am still heartbroken ...

In Memorium - James Wilson Button
Published in the Chicago Tribune - December 10, 2001

James Wilson Button, age 84, retired Sears Marketing Executive and Navy Veteran, beloved husband of Lurena Stubbs Button,  loving father of James W. Button, Jr., of St. Louis, MO, Douglas S. Button, of Louisville, TN, and Katherine Button Bell, of St. Louis, MO; dear grandfather of eight; great-grandfather of five; brother of the late Bland Ballard Button, Jr.

During his career, he ran Sears' New York office and was President of Simpson Sears in Canada, before returning to serve as Vice President of Merchandising and finally as Senior Vice President of Sears in Chicago. Mr. Button served as Director on the Boards of Sears, Simpson Sears, Allstate Insurance, Chemical Bank Granger, Harris Bank, GTE Telephone as well as the Council of Economic Education.

Visitation will be held from 5:30 to 9 p.m. Wednesday, December 12, at Wm. H. Scott Funeral Home, 1100 Greenleaf Ave., Wilmette. Services and interment will be private. In lieu of flowers, memorials may be made to The Palliative Care Center and Hospice of the North Shore, 2821 Central St., Evanston, IL 60201 and to the University of Chicago, c/o Gwen Jessen, 1116 E. 59th St., Chicago, IL 60637. For info: 847-251-8200.

Representative Tierney Needs Help for
Hearings on HR 1322

November 28, 2001

Congressman Tierney, sponsor of HR 1322 (the Emergency Retiree Health Benefits Protection Act of 2001), needs your help. He needs e-mails (snail mail is NG at present) that support the bill.

The Association asks you to email the Congressman, thank him for his leadership in sponsoring this bill and for his efforts in pushing for the bill's passage. Add a personal note as to why this bill is important to you. You can also give him a story about how your healthcare coverage has been reduced, or the cost increased, since your retirement.

1. Go to www.house.gov/tierney

2. Scroll down the left side of the home page to "E-mail Congressman Tierney" and click on the mailbox.

3. Fill in your name, address and other information in the mask. If you are not in the Congressman's area, put your city, state and zip in the second line of the address box.

4. Type your message and send.

Sears Retiree Group Life Insurance
Litigation Notice and Claim Form

November 1, 2001

The Notice and Claim Form that is being sent to Sears Retirees is also set forth in Settlement. You may download the Claim Form which appears after the Notice by clicking on "Get Claim Form" below.

The Claim Form must be signed and submitted according to the mailing instructions on the Claim Form. Alternatively, if you are not able to print the claim form from you computer, or if you do not receive a Notice and claim form in the mail in the next few days, you can phone 800-347-0716 - press option 2 - and Sears will mail you a claim form.

Please keep in mind that the claim forms must be signed and returned by the January 17, 2002 deadline.

Notice of Proposed Settlement

Get Claim Form

Narse Proposed Life Insurance Settlement
Important Dates
October 31, 2001

Court Hearing
The Court Hearing originally scheduled for July 31, 2001 was rescheduled several times before actually being held on October 10, 2001. It was attended by ten NARSE members.

During the hearing Judge Moran expressed his pleasure that the two sides had reached an agreement and noted that the law was not on the side of the retirees.  We are to receive from the lawyers a transcript of his exact comments.

After the hearing, the plaintiffs’ lawyers met with NARSE for over two hours of discussion,
expanded explanations, questions, expression of feelings, etc.  The lawyers feel that “nothing was left on the table”.

The below is the best understanding that NARSE can make of what we have read and/or heard. We are NOT lawyers and are NOT advising or suggesting what any individual's actions or choices should be.  Each Sears Retiree should make his/her decision and may wish to seek legal counsel before making the final decision.

PROPOSED SETTLEMENT
Sears CEO Alan Lacy said it was settling because management ''wants to reunite the Sears family and believes that this settlement constitutes an important first step in consolidating the confidence and goodwill of its large retiree base.''

Sears Roebuck and Co. workers who retired between 1978 and 1997 will retain more of their life insurance benefits under a settlement plan between retirees and the company tentatively approved Wednesday (October 10, 2001) by a federal judge in Chicago.

The proposed Settlement extends to all Sears Retirees who are subjected to Sears’ reductions of their retiree life insurance benefit and who prior to the reductions had more than $5,000 in Sears Retiree Group Life Insurance.

1. At a minimum, the 10% Life Insurance reduction scheduled for the Year 2003 would not be taken for retirees who file claims. Depending on the claims experience (the number of retirees filing claims and the size of their life insurance benefits) some additional planned reductions beyond 2003 could possibly occur.

2. The minimum 10% and the $5,000 life insurance under the “1997 Plan” could never be reduced later by Sears

3. In addition, the estates of retirees who have died since Jan. 1, 1998, or who die before Dec. 31, 2002, will receive a Sears gift card of $100, according to court documents.

Proposed Settlement - Critical Times **

November 1, 2001 ** 
Mailed Notice.  
This should be an envelope clearly marked on the outside stating: “Important Class Action 
Settlement Notice and Claim Form For The Sears Retiree Group Life Insurance Litigation from the 
Clerk of the United States District Court.”

November 8, 2001 ** 
Publish Newspaper Notices.

December 10, 2001 ** 
Deadline for receipt of objections and Requests for Exclusion.  
Sears can cancel the Settlement if more than 1,000 class members validly request exclusion 
from the Class.

January 7, 2002 ** 
Deadline for Sears to exercise option to cancel settlement.

January 17, 2002 ** 
Deadline for submission of Claims Forms.

March 5, 2002 ** 
Court hearing on the fairness of the Settlement.  
Objections to the settlement will be heard by the judge at this hearing. You will want to read the 
Settlement Notice carefully as it presents you with several choices:

** Sign and Send In Blue Claim Form Before January 17, 2002: 
You must file a claim to receive 10% more life insurance and eliminate Sears planned reduction 
for 2003. Eg.: Insurance was $17,000, total 10 year reductions were $12,000, one year 
10% savings = $1,200. One year savings of $1,200 plus the $5,000 now guaranteed. In this example 
Sears cannot reduce the final insurance amount in the ten year reduction program  to less than $6,200.

** Do Nothing. 
If you do not file a claim or request exclusion and the Settlement is finally approved by the Court,
 the reductions will continue as scheduled for all ten years.  Sears cannot reduce the final 
insurance amount to less than $5,000.

** Object to the Settlement. 
You may file an objection or otherwise comment on the Settlement.  If you file an objection 
you may also wish to file a claim because if your objection is overruled and you have not 
filed a claim, you will not benefit from the 10% savings resulting from the elimination of 
Sears’ planned reduction for 2003.

NOTE: Whether you file a claim form or not, you are bound by the terms of this settlement,
 including release of life insurance claims against Sears, unless you request exclusion.

** Request exclusion. 
You will not participate in or benefit from the Settlement if it is approved. Sears can cancel the 
Settlement if more than 1,000 class members validly request exclusion from the Class.
If you request exclusion you can not file a claim form or benefit in any way from the Settlement. 
You can retain counsel and file your own suit against Sears. You will want to consult your attorney 
concerning the deadline for filing your suit. The temporary stay of the statute of limitations ends for 
class members requesting exclusion as of the date of the Final Approval of the Settlement.

Reminder: 
Review carefully the proposed settlement information when received to determine your 
course of action(s).

NARSE has presented this to help you better understand the situation and your choices, but it is your 
choice to make.  A member who had missed a couple of meetings but attended the October 10th 
hearing and the meeting after with the lawyers sent this email: “If Dick Bruce and Tom Dowd 
endorsed the settlement, I am going with their vote. I believe these two persons were in the best 
position to win their case and they opt for the settlement - at least that is what I perceive, 
and I don't have every little detail.” 
(Editor’s note: Dick and Tom were in D/707 Human Relations, have been very active in NARSE, 
and were involved in the negotiations.  It appears that they might have won more on an 
individual basis, but chose a group settlement.)

Again, each Sears Retiree should  make his/her decision and may wish to seek legal counsel 
before making the final decision.

NARSE was organized to protect benefits earned by and available to Sears Retirees.

Preliminary Approval to Settlement

October 11, 2001

U.S. District Judge James Moran gave preliminary approval to a proposed settlement between Hoffman Estates-based Sears, Roebuck and Co. and 80,000 of its retirees that partially restores company-paid life insurance benefits. A final hearing is scheduled for March 5, 2002.

Sears has agreed to forgo one year of life insurance cuts in 2003, which will cost the retailer somewhere between $22 million and $34 million, depending on how many retirees participate. The value of the restored benefits is between $47 million and $106 million, according to actuarial estimates. Sears also has agreed to never reduce life insurance benefits below $5,000 per retiree.

Attorneys from 16 different firms representing retirees have asked for a maximum of $5.4 million in fees, costs and expenses, which would be paid solely by Sears.

For more details, Insurance Settlement Approval

Willowbrook's O'Hare is Making a Splash

By Alice Hencinski - Liberty Suburban Chicago - October 10, 2001
 

(Ed. Note: George O'Hare former Sears Executive and current VP Media Relations for narse was recognized in a surburan Chicago newspaper.)

From Rockford to Quincy, George O'Hare has been making quite a splash. In just two months, the Willowbrook resident has earned 12 gold medals while competing in five Senior Olympics contests.

At the spry age of 74, O'Hare also has received recognition as the oldest honorary member of the Hinsdale South Hornet Swim Team. Although he belonged to swim teams at Austin High School and the University of Illinois, his alma mater, O'Hare last competed with the Great Lakes U.S. Naval Training Station swim team in 1944.

But when asked to deliver a keynote address to the Rockford Area Senior Citizen Olympics in 1991, O'Hare felt a sudden urge to enter the 50- and 100-yard swimming contests.

"I won a gold medal for each of the events without practicing. After the contest I could barely get out of the water because I was so beat," O'Hare recalled. "But I thought that the Senior Olympics was one hobby I might want to pursue someday."

Ten years later, O'Hare finally took the plunge and registered for numerous Senior Olympic events throughout Illinois. Since August the Ridgemoor resident has dived into aquatic activities with energy and enthusiasm.

In August, O'Hare won three gold medals for the 50-, 100- and 200-yard breastroke meets at the Rockford Area Senior Olympics. In the weeks that  followed, O'Hare earned nine more gold medals in backstroke contests, including the Southland Senior Games at the Oak Lawn Park District, Great River Golden Games in Quincy and South" western Illinois Senior Olympics in Fairview Heights.

During the most recent event held Sept. 29 in Springfield, O'Hare felt humbled upon receiving his first silver medal for the 50-yard backstroke contest.

"I was a bit surprised to be beaten by an 87-year-old man! But then I learned he was a former Olympic backstroke swimmer. And I did get the gold medal in the 100-yard race,'' O'Hare quipped.

Clearly, the 3 "Rs" common to some septuagenarians _ retirement, relaxation and rest remain foreign to O'Hare's vocabulary. Since retiring from Sears, Roebuck and Co. in 1984, O'Hare embarked on his second career as a motivational speaker. His message is familiar to Lions, Rotary, AARP, and Kiwanis groups, who are taught to "accentuate the positive."

In 1989, former Illinois Attorney General Neil Hartigan appointed O'Hare director of senior citizen advocacy, a position he maintained under former Illinois Attorney General Roland Burris. In his speeches, O'Hare presents his theory of longevity. "Two things cause premature death. They are inactivity and bad diet, or both," he said.

O'Hare, who has enjoyed 50 years of marriage to his wife, {Jean}, considers himself "the luckiest man alive." He regards comedian-activist Dick Gregory as his mentor. "I am very grateful to him for changing my life physically and spiritually. Because of him I'm a better Catholic. He brought me the gift of humor,'' O'Hare said.

"I'm 74 years old and don't get sick. I've been a vegetarian for 28 years. I eat only fresh fruits, vegetables, vitamins, herbs and drink bottled water."

To prepare for the contests, O'Hare swims 400 yards daily at the Oak Brook Park District. While training for the Spring" field competition, he was dismayed to discover the Oak Brook pool had been closed for renovations. Quickly, O'Hare visited Frank Kuchta, swim coach at Hinsdale South, his sons' alma mater. Kuchta allowed O'Hare to swim daily in the campus pool after school hours. Impressed with his athletic commitment, Kuchta feted O'Hare by naming him an honorary member of the Hornet Swim Team.

 

Response from Sears Regarding the
I
ncreased Costs of Medical Premiums

Understanding Your Medical Costs

October 9, 2001

Below is a response from Sears regarding the increased costs of medical premiums:

Sears contribution to retiree medical coverage is frozen based on 1995 levels or the year of retirement, if later. Because retirees bear the full cost of premium increases, a 20% increase in the overall premium results in a higher percentage increase in retiree contributions.

For instance, let’s assume the total monthly premium for HMO coverage is $200. Let’s assume that in 2001, Sears paid $100 of this and the retiree paid $100. Let’s also assume that the total cost increases by 20% to $240 in 2002. Since the retiree pays the entire increase, the retiree’s contribution will rise to $140 in 2002, which is a 40% increase.

As outlined in the annual election materials, and as you can read in almost any newspaper, these increasing costs are being experienced by employers in every industry across the country. The only alternatives Sears has are to (1) change plan benefits and (2) eliminate those plans that propose unreasonable premium. Sears has used both strategies to keep premium increases as low as possible.

One way retirees can help cut their costs is by asking their physicians to prescribe generic or preferred brand drugs and by requesting convenient home delivery of up to a 90-day supply of these drugs. With prescription drug costs soaring Sears has provided these options to keep plan costs down while providing retirees with additional savings.

Sears retiree Dan Fapp asked the following question and Sears response is below his comment:
While I understand Sears response (above), the example in the first line of the second paragraph concerns me. It was my understanding, as far as a pre-2000 retiree was concerned, Sears pays 75% and the retiree 25%. Sears portion, in dollars, never increases from that point on. With this example, it looks like 50/50 at year one.

Sears response:

Here's some additional explanation from Benefits on how the split works. Hope this helps clarify.

1) Prior to 2000 retirees, Sears contributions in the year of retirement were 75, 65, 55 or 45% based on length of service. Not all retirees got a 75/25 split.

2) Because retirees pick up the cost of increases, a split that starts out as 75/25 in year one is going to migrate to something different in year 2, year 3 and year 4. For instance, if a $100 premium is split $75 company and $25 retiree in year one and the rate goes up 20% the next year, in year two the premium will be $120; the company's share will be $75 and the retiree's will be $45. The split is now 62% company and 38% retiree. etc.

New Court Date for Proposed Life Insurance Settlement
Wednesday - October 10, 2001

Sept. 29, 2001

The attorney for the plaintiffs, Mike Mulder, called to advise that another, and we hope final court date and time has been set.

Judge Moran has scheduled 10:30 a.m. on Wednesday, October 10, 2001 for his determination as to whether the proposed settlement should be released to Sears Retirees. The hearing will be held in the US District Court Dirkson Building in Chicago.

As noted previously, we believe that it would be favorable for as many NARSE members available to be in the Courtroom. There may not be an opportunity for those present to be heard. Objections are presented to the presiding judge at a fairness hearing probably late 2001 or early 2002. The judge will consider any objections raised at that time, and has the option of refusing to approve the proposed settlement because the Court agrees with the objecting parties, or agreeing to approve the settlement over their objections.

 

In Memoriam - Peter Malloy
October 1, 2001

Peter Malloy, was a retiree of Sears. He worked for them for 35 years having retired in 1982. He worked in the Southwest Territory in Purchasing for Store Planning. He was Manager of Dept 806SW.

He passed away on September 28, 2001 at the age of 82 and will be buried in the National Cemetary in Dallas October 1, 2001.

 

Pertinent Facts on the Proposed
Retiree Life Insurance Settlement

Information from Attorney - September 7, 2001

Latest Court Delay

The August 31 court date was canceled for the following reason: When Met Life searched the Sears retiree file in preparation to mail every retiree the proposed settlement, they found that approximately 1,800 retiree names were not included in the current retiree data base. These individuals were on a medical leave of absence, workers compensation leave, etc. at the time Sears made the decision to dismantle our promised benefit. In fairness to each of the overlooked retirees, it was decided by both parties (Sears and attorneys for the plaintiffs) to delay the hearing and present the Judge with the full and correct database. While some may question this as a delaying tactic, in NARSE’s opinion it was justified and proper.

NARSE is not and has not been a plaintiff in the class action suit against Sears. NARSE does not have a vote in the approval process. NARSE was given an opportunity to “endorse” the proposed settlement. The final approval will be made by approximately 80,000 Sears retirees after they have an opportunity to review the proposed settlement, return their approval/rejection or choose to disregard the offer.

DISCLAIMER
The following information has been supplied by Attorneys' for the plaintiffs. NARSE is not responsible for the contents or any claims or damages resultant to the release of the information.

Latest information from the plaintiffs attorneys
It is expected that within the next six weeks, retirees should receive a formal notice of the terms of the settlement. The Court is scheduled to consider the preliminary approval of the settlement very soon. A mailing date for the formal notice of settlement is currently set for approximately October 1.

From the attorneys, below are some attachments that will make it easier for retirees to understand what has been going on. It includes a “case history” and a list of the reasons given by some of the named plaintiffs and class counsel in the settlement agreement itself as to why they believe this is a prudent settlement. Also, is a summary description of the settlement terms and an information sheet in a Q & A Format on “opting out” of the settlement, which is one of the options retirees have as they look ahead. If a retiree decides to “opt out”,’ it is suggested that they contact either the plaintiffs attorneys as listed below, or any other attorney of their choosing before making the decision to be excluded from the settlement. If there are further questions after retirees have reviewed the information supplied by the attorneys, contact Ann Watson at 612-339-7131.

Primary attorneys are:

Michael M. Mulder
Meites, Mulder, Berger & Mollica
208 South LaSalle Street, Suite 1410
Chicago, IL 60604
Ph: 612-339-7131 Fax: 612-339-6591

Wood R. Foster, Jr.
Siegel, Brill, Greupner, Duffy & Foster

1300 Washington Square
100 Washington Ave. S.
Minneapolis, MN 55402
Ph: 612-339-7131  Fax: 612-339-6591

“HISTORY” OF THE CASE

Origination of Suit: In September 1997, Sears announced that retiree life insurance benefits under the Plan would be cut back for all Plan participants who retired after January 1, 1978, at the rate of 10% per year on each retiree's life insurance amount in excess of $5,000. At the end of ten years, each retiree would have a $5,000 retiree life insurance policy, regardless of original amount. Sears reserved the right to reduce benefits even further, or to terminate the Plan entirely. Thereafter, a number of suits were filed against Sears by retirees who alleged they had been promised “free” or “paid up” life insurance for the rest of their lives. All lawsuits were eventually consolidated in the United States District Court for the Northern Distract of Illinois and were assigned to Judge James B, Moran.

Claims: Sears retiree life insurance benefits were (and are) governed by the terms of a plan set up by Sears many years ago. In general, the complaints alleged that Sears had breached the terms of the Plan by cutting back the amount of the life insurance: that Sears had entered into - and breached - a separate contract with Class Members concerning life insurance: and that Sears had breached its fiduciary duty to Plan participants by making materially misleading and incorrect statements about retiree benefits to Plan participants before they retired.

Defenses: Sears denied that it violated any statutory or common law obligation, to its retirees. and asserted that it had a full legal and contractual right at all times to modify or terminate the terms of the Plan.

Judgment Granted For Sears On Certified Claims: In order for Plaintiffs to proceed on behalf of all retirees as a class, they were required to satisfy Judge Moran that the case met all of the requirements provided to the Federal Rules of Civil Procedure for “certification” of class actions. After extensive briefing, the Court certified a class action only with respect to the “plan enforcement” aspects of the case. but denied class certification with respect to the breach of fiduciary duty claims and other claims brought by the Plaintiffs, The Court ultimately granted Sears’ summary judgment on the “plan enforcement” claims.

Uncertified Claims Set for Trial: What remained were claims for breach of fiduciary duty - claims that were not certified by Judge Moran for class action treatment, proposed conditional class be certified and the Settlement be finally approved, There were initially 71 named Plaintiffs in the various consolidated cases, five of whom have since died. At the Plaintiffs’ request, the Court directed the parties to select 12 of the 66 Plaintiffs whose cases would be tried in September 2001 on the issue of breach of fiduciary duty and promissory estoppel. The parties engaged in extensive discovery, including dozens of depositions throughout the United States of present and former Sears employees and upper level executives, in preparation for the trial.

Mediation and Negotiations: During ongoing trial preparations, the parties began a process of negotiation and formal mediation, using a professional mediator to assist them in moving toward a settlement. In the settlement negotiations, several of the named Plaintiffs were regular participants, along with representatives of NARSE, the National Association of Retired Sears Employees, which had taken a very active interest in the prosecution of the case.

Settlement: On July 5, 2001, after three months of mediation and negotiations, the parties agreed to settle the lawsuit and signed a Memorandum of Understanding. At a hearing to occur in the near future, the Court will be asked to give preliminary approval to the proposed Settlement, to approve a proposed Notice to all Class Members of the terms thereof and to set a date for a Fairness Hearing. At the Fairness Hearing, the Court will consider the request of the parties that the proposed conditional class be certified and the Settlement be finally approved. The Court will also consider any objections to the Settlement and any requests for exclusion as well as rule on the petition for attorneys’ fees, costs. expenses, and class representative incentive awards.

REASONS FOR SETTLEMENT

Plaintiffs and Class Counsel recommend the Settlement to all Class Members for the following reasons:

1. As noted in the case history, Judge Moran has denied class certification with respect to the only claims that remain viable in the case. Unless the case is settled on a “class” basis, which is what this settlement contemplates, retirees would be left with only the right to file individual suits against Sears. Such suits would be time consuming, costly, and procedurally complex. Plaintiffs and their advisors believe that only a relatively small percentage of the approximately 80,000 retirees affected by the insurance cutback would file individual suits. There would, of course, be no guarantee as to the outcome of those individual cases.

2. This settlement prevents Sears from further increasing the rate of cutback for all retirees, and it prevents Sears from reducing the final insurance benefit below $5,000. Without the settlement, Sears continued to reserve the right to amend or terminate the plan. Sears could have accelerated the cutback or changed the final amount to zero, or both, at any time. This benefit accrues to all Class Members, whether or not they file a Claim Form.

3. The settlement provides an additional benefit to those who believe they were significantly misled by Sears and who sign the Claim Form. All such persons will, without having to engage in further litigation, receive at least one less annual reduction in the amount of coverage, and perhaps more (depending on the number of persons filing Claim Forms).

4. The settlement was achieved with the participation - and endorsement - of the National Association of Retired Sears Employees (NARSE), which has offered steady assistance in communicating the terms of the settlement to Sears retirees, as well as several retired Sears employees not affiliated with NARSE.

5. All costs of suit will be borne by Sears; the benefit negotiated for Class Members is not diminished to pay for attorneys’ fees, costs, expenses, representative plaintiff incentive awards, or costs of administration.

SUMMARY OF SETTLEMENT TERMS

1. Whether or not you file a Claim Form, the Settlement Agreement provides that Sears cannot further accelerate the life insurance reduction schedule that began in 1998 and it cannot reduce the final insurance amount to less than $5,000.

2. Timely submitted Claim Forms shall be considered approved unless Sears challenges a claim based upon substantial evidence of fraud, in which case the validity of the claim will be resolved by a mediator.

3. Class members who timely mail Claim Forms that are approved are guaranteed at least one less annual reduction than the scheduled ten reductions. Their final insurance amount will therefore be at least $5,000 plus the amount of one year's reduction. The “skipped” reduction will be the reduction previously scheduled for the year 2003.

EXAMPLE
If you started with $15,000 of retiree life insurance, your insurance amount has decreased $1,000 per year since January 1, 1998. Under this Settlement, if you timely file an approved Claim Form, the previously scheduled reduction for year 2003 will be skipped, and the final amount of insurance in year 2007 and thereafter will be $6,000 instead of $5,000. The table below show this works:

TABLE 1

Example: - Effect of Settlement On A Retiree With $15,000 Policy 1998 Who Files An Approved Claims Form

Year

Old Reduction 
Schedule

New Reduction Schedule Under Proposed Settlement

Insurance Before
Reduction Began $15,000 $15,000
1998 $14,000 $14,000
1999 $13,000  $13,000
2000 $12,000 $12,000
2001 $11,000 $11,000
2002  $10,000               $10,000  Freeze
2003 $ 9,000 $10,000
2004 $ 8,000 $ 9,000
2005 $ 7,000 $ 8,000
2006 $ 6,000 $ 7,000
        2007 (Final) $ 5,000  $ 6,000

Total of 10 reductions:
final insurance amount
$5,000

Total of 9 reductions: final insurance amount
$6,000

4. Those Class Members who timely file approved Claim Forms (”Approved Claimants”) may be entitled to have Sears forego more than the guaranteed one year reduction in 2003 depending on the number of Class Members who file claims. Exact quantification is not possible until all the Claim Forms are received; further details are discussed in paragraph 5 of this Summary.

5. Under the Settlement Agreement, only a one-year freeze in the life insurance reductions is guaranteed for Approved Claimants. However, depending on the number of Class Members who file claims, Approved Claimants may be entitled to have Sears freeze more than the guaranteed one year reduction in 2003. That depends on certain actuarial calculations, as described below.

bullet The parties will first determine the “Participation Rate” by taking the total number of Approved Claimants and dividing it by the total number of living Class Members as of the date this notice was sent.
bulletThe parties then will calculate the “net present value” (an actuarial term defined in the Settlement Agreement) of the cost to Sears of freezing the scheduled reduction for the year 2003 for all Approved Claimants (“the 2003 Freeze Cost”). The parties estimate that if 100% of Class Members were to file claims, the 2003 Freeze Cost would be roughly $34.1 million.
bulletThe 2003 Freeze Cost for a particular Participation Rate cannot be predicted in advance, because it depends on the size of the policies of the Approved Claimants. For example, if the Participation Rate is 35%, the 2003 Freeze Cost will be bigger if the Approved Claimants are the 35% with the largest insurance benefits, rather than the 35% with the smallest insurance benefits..
bulletAfter determining the Participation Rate and calculating Sears’ 2003 Freeze Cost, the parties compare the 2003 Freeze Cost to the “Guaranteed Minimum Amount” for the corresponding Participation Rate in the following table:

TABLE 2

Participation Rate Guaranteed

Minimum Amount

51% or Higher $28 Million
50% $27.97 Million
49% $27.67 Million
48% $27.37 Million
47% $27.07 Million
46% $26.77 Million
45% $26.47 Million
44% $26.17 Million
43% $25,87 Million
42% $25.57 Million
41% $25.27 Million
40% $24.97 Million
39% $24.67 Million
38% $24.37 Million
37% $24.07 Million
36% $23.77 Million
35% $23.47 Million
34% $23.17 Million
33% $22.87 Million
32% $22.57 Million
31% $22.27 Million
30% or less $21.97 Million
bulletIf Sears’ 2003 Freeze Cost is the same as or larger than the Guaranteed Minimum Amount for the corresponding Participation Rate in the above table, then Sears will freeze the life insurance reduction for Approved Claimants only in the year 2003. However, if the 2003 Freeze Cost is smaller than the Guaranteed Minimum Amount for the corresponding Participation Rate, then Sears will freeze the life insurance reduction for Approved Claimants in the year 2003 and, in addition, will freeze additional life insurance reductions for the Approved Claimants (on a pro rata basis) in 2004 and possibly later years, until the net present value of the total cost to Sears is equal to the Guaranteed Minimum Amount for the corresponding Participation Rate.
bulletA concrete example will help to illustrate this abstract explanation. Assume that the Participation Rate is 35% (that is, the number of Approved Claimants is equal to 35% of the number of living Class Members as of the date this notice was sent). That means the Guaranteed Minimum Amount, the right-hand column in the table above, is $23.47 million. If Sears’ 2003 Freeze Cost is $23.47 million or larger, then Sears will freeze the life insurance reduction for Approved Claimants only in the year 2003. However, if Sears’ 2003 Cost For Approved Claimants is smaller than $23.47 million, then Sears will freeze the life insurance reduction for Approved Claimants in the year 2003 and, in addition, will freeze additional reductions for the Approved Claimants (on a pro rata basis) in 2004 and possibly later years, until the net present value of the total cost to Sears is equal to $23.47 million.
bulletThe same conditions apply for each line of Table 2. If Sears’ 2003 Freeze Cost for a particular Participation Rate in the left-hand column is smaller than the corresponding Guaranteed Minimum Amount in the right-hand column, there will be additional benefit for the Approved Claimants.
bullet# As Table 2 shows, if the Participation Rate is 30% or less, the Guaranteed Minimum Amount is $21.97 million. Thus, even if only a small percentage of the Class files approved claims, Sears will freeze life insurance reductions for Approved Claimants (and possibly reinstate prior years’ reductions for Approved Claimants) until the total cost to Sears is $21.97 million.
bullet# If money is left over after foregoing all remaining scheduled reductions and reinstating all prior reductions for Approved Claimants, the remaining amount will be distributed pro rata to the Approved Claimants, unless the remaining amount is less than $1.5 million, in which case it will be donated to charity.

6. The benefits under this proposed Settlement apply to all Class Members, whether or not they paid “replacement premiums” to avoid Sears’ cutbacks. However, Class Members must file Claims Forms to obtain the benefits its paragraphs 3-5.

7. The estates of retirees who die (or have died) between January 1, 1998 and December 31, 2002 will receive a $100 unrestricted Sears gift certificate. (The gift certificate will be sent to the beneficiary receiving the highest percentage of the life insurance payment for that retiree, or, if all beneficiaries for that retiree receive an equal percentage, the beneficiary whose first name comes first alphabetically.) Disputes about entitlement will be decided by a mediator.

8. Sears will pay each of the 71 named plaintiffs who brought the lawsuits a $5,000 special payment for the risk, time and efforts they expended in bringing the case. The activities the named plaintiffs participated in included obtaining counsel, working with counsel, filing suits, producing documents, answering written questions from Sears lawyers and traveling to depositions, where they answered oral questions under oath asked by the lawyers for Sears.

9. Attorneys fees and costs of the litigation will be paid by Sears, not the class. The Court will decide the amount of fees and costs Sears must pay, which cannot exceed $5.4 million.

10. If the Settlement is approved, it will be binding on all Class Members who do not request exclusion. If more than 1,000 retirees request exclusion, Sears has the right to terminate the proposed Settlement.

“OPTING OUT”

THE IMPLICATIONS OF REQUESTING EXCLUSION
FROM THE SEARS CLASS ACTION SETTLEMENT

What does it mean to “opt out”?
If you “opt out” (which is exactly the same thing as “requesting exclusion”) from this or any class action settlement, it basically means you will not receive any of the settlement benefits, and you will not release Sears from any claims you might have. The settlement will go forward without you, and you will retain all legal nights you have to sue the defendant - in this case, Sears.

Why do people opt out?
There are several reasons why people might opt out of this lawsuit:

I. People who genuinely want and intend to sue Sears individually must opt out if they want to pursue their individual suit. If people who wish to sue Sears individually fail to opt out, they are bound by the settlement, and lose their right to sue individually.

2. Some people may opt out simply because they do not wish to take part in the settlement. This might be a matter of principle, because they believe they should receive more than the settlement offers them, or because of personal religious or social convictions concerning participation in lawsuits generally.

3. People who believe that Sears was right all along and that the lawsuit should not have been brought in the first place may wish to opt out.

4. There could be a myriad of other reasons, many of them personal to the class member faced with the decision.

Is opting out the same thing as objecting to the settlement?
No. Class members who intend to participate in the settlement if it is approved may still object to the settlement as a whole. Objections are presented to the presiding judge at the time of the fairness hearing, which will occur in late 2001 or early 2002. The judge will consider any objections raised at that time, and has the option of refusing to approve the settlement because he agrees with the objecting parties, or agreeing to approve the settlement over their objections. The formal notice that you will receive explains how and when objections can be asserted.

People who opt out are no longer part of the class action suit. They do not have a right to object to the settlement, because they are no longer affected by the settlement.

What are the actual legal ramifications of opting out?
If you opt out, the settlement benefits are not available to you. You cannot file a claim form. You do not release any rights against Sears, and Sears does not release any rights against you. You retain the right to sue Sears individually. If you do not sue individually, you will eventually lose your right to sue because of the statute of limitations.

If I opt out, can Sears reduce my remaining insurance benefit even further?
In theory, yes. Sears has always claimed the right to amend or terminate the plan, and the judge has upheld the validity of the way Sears preserved that right. The fact that Sears has the right to terminate does not mean Sears will exercise that right, but there is no way to know in advance.

What is involved if I want to opt out and sue Sears individually?
We strongly advise you to discuss this directly with an attorney before deciding to opt out. In general, you should expect that there will be “up front” costs of at least several hundred dollars involved, as well as a substantial amount of your own time and energy required. You should consult an attorney to determine whether the individual facts of your case are likely to produce a favorable result. Individual attorneys may or may not be willing to take the case on a “contingent fee” basis. You should also have your attorney call one of the attorneys for the class to discuss certain timing and deadlines that must be considered.

There is no guarantee that the attorneys who have represented the class in this case will represent individuals who opt out and wish to sue individually. While they are not prevented from doing so, class counsel would wish to review each case on its merits before agreeing to represent one or more people who opt out. It is important to understand that a private fee arrangement would have to be made by each individual retaining counsel.

Gordon’s Comments:

DISCLAIMER:
JUST A REMINDER THAT ALL THE ABOVE INFORMATION HAS BEEN SUPPLIED BY ATTORNEYS FOR THE PLAINTIFFS. NARSE IS NOT RESPONSIBLE FOR THE CONTENTS OR ANY CLAIMS OR DAMAGES RESULTANT TO THE RELEASE OF THE ABOVE INFORMATION.

In Memoriam
William Wallace Tudor, Sr.

Philadelphia Inquirer - September 5, 2001

WILLIAM WALLACE TUDOR, SR., on Sept. 3, 2001, age 90, of Cherry Hill, N.J., formerly of River Forest, Illinois, husband of the late Mildred E. (nee Galloway), survived by son Thomas G. Tudor and his wife Francine, of Cherry Hill, grandchildren Wesley and Tasha, son William Wallace Tudor, Jr. and wife Marie of Monrovia, Indiana, grandsons Gregory and Bradley, great grandchildren Betsy, Braden, Whitney, and Zachary. He was employed by Sears, Roebuck and Company from 1936 until his retirement in 1974, having been Vice-President of Personnel and Employee Relations and a Director of the company for many years.

He was active in a number of charitable activities, most notably as National Crusade Chairman for the American Cancer Society in 1960. Friends are invited to attend his Viewing on Thur. 7 P.M., to be followed by the Funeral Service at 8 P.M., at the McCHESNEY FUNERAL HOME, 30 West Main Street, Moorestown, N.J. Int. will be in Indiana. In lieu of flowers, family requests that contributions be made to the American Cancer Society, 401 White Horse Pike, Haddon Heights, N.J. 08035.

Notice from NARSE Attorney
August 29, 2001

I am writing to inform you that the hearing on the motion to preliminary approve the settlement which was scheduled for August 31, 2001 has been postponed. The Court has not yet set a new date for the hearing. As you know, the parties filed a joint Memorandum of Understanding with the Court  on July 5, 2001. Since that time, Sears and the class attorneys have been drafting a formal settlement stipulation, notice to class members to be sent by mail, summary notice to be published in newspapers, a motion to approve the settlement, and memorandum in support of the settlement. The parties expected to file these documents on August 28. However, because further time is necessary for their completion, the hearing has been postponed by the Court. As soon as the new hearing date is rescheduled, class counsel will advise NARSE.

Very truly yours,
Michael M. Mulder

_______________________________________

Gordon's Comment:
The above is a copy of text just received from the plaintiff's lead attorney. I believe this is the seventh reschedule of the action. NARSE will keep you informed as to future developments.

 

Is Sears Serious About Settling with Retirees?
Let Us Know Your Thoughts!

Thursday, May 24, 2001 - N.A.R.S.E. Communications

Prior to the Sears Annual Meeting, it was widely published in the news media that Sears has been working to negotiate and resolve the life insurance fiasco. Two weeks have now passed without any word from Sears. As a NARSE Director, Tom Dowd pointed out to Sears' CEO Lacy at the Annual Shareholders Meeting, "Our patience is not everlasting", and warned that retirees will not walk away from this issue.

We'd like to have your comments and sentiments. "Is Sears serious about resolving our retiree life insurance fiasco?"

info@narse.org

Alan Lacy's Letter to Associates

April 12, 2001

Dear Sears Associate,

Sears issued today a rather complex news release covering four significant financial topics - our March sales results, a pre-announcement of first-quarter earnings, the adoption of a new accounting standard for how we report our credit results and a change in how Sears reports financial results to our investors.

I would like to provide some perspective on these four topics. Our March sales were disappointing, a decrease of 5.3 per cent for comparable stores. This was below our expectations for the month. The weather played a role in this decrease. So did the stall in the economy, as customers are being cautious with their spending. Many other retailers also had a difficult month.  But some will post gains. In order to grow during tough economic times, we  must take share away from our competitors.

Primarily related to domestic retail performance, Sears announced
anticipated first-quarter earnings per share will be approximately $0.53,
compared with $0.65 for the first quarter last year. These results were
below what the investment community expected.

Sears also announced an accounting change that will require Sears to take a
$520 million non-cash charge to earnings. Adopting this new accounting
standard is desirable to simplify the accounting for our important credit
business, and we expect our analysts and investors will welcome the change.
Please see our intranet site, InSide Sears, for more information.

Since this is an accounting change, this charge to earnings will have no impact on our 2001 incentive. However, our operating performance does.

Needless to say, our first-quarter performance was not up to our expectations. We must redouble our efforts to improve our performance for the rest of the year.

Sears announced a new structure for reporting our results by business
segment that better reflects our strategic direction and structure. These
segments now include:

bulletRetail and related services, which consists of merchandise and
related services and all Sears selling channels, e.g. retail, catalog,
online.
bulletCredit and financial products
bulletSears Canada (formerly international)
bulletCorporate and other, which includes certain home improvement services,
e.g. STPC.

Our old financial reporting structure included a fifth segment called
services. Product Repair Services results are now included as related
services with retail. Financial products results are now combined with
credit.

The media may draw various conclusions from this news release. Associates,
customers, friends and family may ask questions. All of us, especially our
front-line associates, should be prepared to answer that:

Sears is a very financially sound company. The charge to earnings
reflects a change in the way we account for our financial results, not a
deterioration in the fundamentals of our business.

bulletSears management is taking aggressive action to better meet needs of the customer.
bulletThis is a year of transition for Sears, and there will be much news as
changes occur. The changes unquestionably will be for the better, and we
are excited about our future.

What can you do? Focus on three things - serving the customer, productivity
and profitable sales growth. The full-line stores are featuring our Sears
Days promotion, offering some of the year's best values. On May 6, there is
an associate appreciation event. Every associate should encourage friends
and family to shop.

We are in the process of developing a new marketing plan that will be
implemented this summer. We are also working to re-assort the merchandise
in our stores, giving more space to merchandise categories that are winning
with customers and eliminating those in which we do not have customer
relevance. That program also will be implemented this summer.

New programs will drive better trends in the future. But there is much that
needs to be done now. We must all work better together as a team to
increase productivity and profitable sales.

Please submit your ideas to my website, Alan Online. These thoughts
automatically go to managers in the appropriate areas and to me.

I look forward to hearing from you.
 

Update: Sears Retiree Group Life Insurance Litigation
March 5, 2001

Federal Judge James B. Moran of the United States District Court for the Northern District of Illinois, has set a trial date in the Sears Retiree case for September 4, 2001. 

The court will try the individual breach of fiduciary duty and promissory estoppel claims of about a dozen Sears retirees. The retirees who will go forward in this first trial will be selected from the sixty-seven plaintiffs named in the suit. The case will be heard by the Judge in Chicago. 

According to the Court's order it will take about six days to try the plaintiff's claims. NARSE will keep you updated on developments as it continues to monitor the case.

 

Write Your Congressman 
Re: HR 1322 Health Insurance

We have made arrangements with the National Association of Bell Telephone retirees to use their website to write your Congressman regarding the above bill.

To use their website simply click here www.belltelretirees.org

Once into their site scroll down to "Write to Congress (enter your zip code) Enter your zip code again in the area entitled "Action Alert" Choose the letter you wish to send (4 choices) Modify the letter taking out reference to Bell and insert Sears Roebuck and Co. Retiree and member of narse (National Association of Sears Retirees) Change bill to HR1322 Follow directions to send.

Any questions contact narse website

WE NEED YOUR SUPPORT

narse and Amazon.com

As you can see we have formed a relationship with Amazon.com. Amazon will pay narse 8.0% commission for all merchandise ordered from our website. To do so simply click on the Amazon icon and place your order. 

If you have any suggestions for other dot.coms let us know.

Annual Meeting Notice
Important: Requires Your Immediate Attention

On September 4, 2001 the Federal District Court of Northern Illinois, Judge Moran presiding, will conduct the first trial for about twelve of the named plaintiffs in the Sears Retirees Group Life Insurance Litigation. The plaintiffs' breach of fiduciary duty claim will be heard.

THESE CLAIMS ARE NOT CLASS ACTION CLAIMS.
The district court has ruled that "breach of duty" claims must proceed on an individual-by-individual basis. You may have to make a decision about whether to file an individual claim before the outcome of the September trial is known, in order to timely reserve your claim.

AGAIN, you must decide whether to pursue individual legal action or lose your insurance benefits. To help you in your decision the National Association of Retired Sears Employees, Inc. is hosting a special meeting on May 9, 2001. Attorneys Foster and Mulder will discuss the status of the lawsuit case and address any questions you may have about what is necessary for you to do to proceed with your breach of fiduciary duty claim.

Please! Mark your calendar. Plan to attend these meetings: 

N.A.R.S.E. Annual Meeting
Wednesday, May 9, 2001

Location: Stonegate Conference and Banquet Centre
2401 W. Higgins Rd., Hoffman Estates, IL 
Time: 2:00 p.m. - 5:00 p.m.

Agenda

Welcome: Ev Buckardt 
Nomination
of officers:
Clif Hooks
ERISA & Retirees:  Mary Signorille, AARP Sr. Counsel
Retiree-Rights Bill: Congressman Tierney from Massachusetts will discuss his pending legislation.
Litigation: Attorneys Foster & Mulder will explain the litigation
Adjourn Ev Buckardt 
Social Hour: 5 p.m. Cash Bar
Dinner: 6 p.m. - $20/person

Sears Annual Shareholders Meeting

Date  Thursday, May 10, 2001 
Location Sears Corporate HQ. 
3333 Beverly Rd., Hoffman Estates, Il 
Time 10:00 a.m. - 11:30 a.m. 
We have been informed that no Admittance pass is required. Complete details & plans for the meeting will be provided at Wednesday's NARSE meeting.
Motel La Quinta Inn, 2280 Barrington Rd., Hoffman Estates, Il 
Reservations  Call 1-800-531-5900
Rate Double Occupancy - Ask for NARSE rate - $71 plus tax.
Transportation Southwest has a senior fare to Chicago for $129 each way, no advance purchase required. We fly into Midway Airport in Chicago. If you choose to fly SWA let us know so we can make ground transportation arrangements together, if possible. 

Your participation at these meetings is needed and appreciated. Space is limited, so please contact Ev Buckardt ASAP to confirm your attendance, arrangements, dinner, special needs, etc. Call 1-847-323-6702 or e-mail at beks@ameritech.net.

Thank you for your continuing support.

Ev Buckardt, Chairman 
Claude Ireson, Vice Chairman
Clif Hooks, President

Lost Sears Friend - Kelly Hodges

I am looking for a lost Sears friend. I last heard he was a Store Manager in Phoenix, Arizona and that was 4-5 years ago. If you have any information, please email me. loudolores@webtv.net

Thank you for any assistance you might have in locating him.

Louis Huggins, President
Sears Retirees,
Tallahassee, Florida

Quick Review: 
Fiduciary Trust Relationship Explanation
By Gordon Muschett - March 20, 2001

Such a relationship exists when a person or entity, such as Sears, acts primarily for another's benefit and well being. An example might be administering a life insurance program as a benefit to attract and retain employees, or as an inducement to retire. This status gives rise to certain legal obligations including to act in the best interests of the other person. In other words, when one places his/her trust and relies upon another to their detriment, such relationship is breached and the person or entity breaching this relationship, such as Sears, may be held legally accountable.

Federal Judge James B. Moran, of the United States District Court for the Northern District of Illinois, has set a trial date in the Sears Retiree case for September 4, 2001. The Judge will take some time to consider the case and then issue his decision. The documentation and depositions regarding this lawsuit are quite large. The information applies to the Sears Retirees effected by the life insurance reduction by Sears. 

Remember, this lawsuit was not given class action status. If the ruling is for the twelve Sears Retiree plaintiffs we believe that further action will have to be taken by each of us. NARSE is trying to determine what action by you, as an individual, will be necessary if the current lawsuit is successful. 

Our goal is to receive answers by the NARSE Annual Meeting on Wednesday, May 9, 2001. NARSE will follow the case and will try to keep you updated on developments.

 

Passing of Two Former Executives
March 10, 2001

We are sad to report the deaths of two former Sears Executives:

 Robert (Bob) Foster
former Zone Manager Pacific Northwest
 died March 9th

Bill Lochmoeller
former Executive Vice President Western Territory 
funeral March 3


Sears Retiree Presidents Meet with Sears Executives 
By Art Levin, Phoenix Retiree Club President & VP of narse
February 17, 2001

Eighteen Sears Retire Club Presidents were invited to attend a Sears Advisory Council meeting with Sears Chairman Alan Lacy on January 31- February 1. The meeting was held in Scottsdale, AZ and was in conjunction with Sears annual executive conference. 

Mr. Lacy presented an overview of Sears performance, current conditions, plans for 2001 and answered retiree questions in an open forum. Retiree Club Presidents challenged the decision to reduce the promised retiree life insurance benefit. Mr. Lacy said he was involve in the decision and the resolution will be determined in the legal process. Retirees made it very clear that a resolution to this sensitive issue is paramount for retirees to return to their former support of the company. Mr. Lacy promised to make every effort to protect remaining retiree benefits. He and the executives, who met with the presidents, assured the attendees this was not an attempt to circumvent NARSE. In fact, he acknowledged NARSE leadership and indicated he would meet with them again in March to further discuss concerns. Lacy also pledged to work with the newly created Sears Advisory Council on retiree issues, should they arise. Art Levin, Phoenix Retiree Club President and NARSE Regional Vice President represented NARSE at the conference. 

The March issue of NARSE Straight Talk will feature a complete recap of the meeting including photos and personal comments of those who attended the Scottsdale meeting. Sears will include a summary of the meeting in their next issue of Sears Retiree News. Attendees were assured the issue would not be a public relations effort to send a message that Sears retiree's are "happy campers" and no longer concerned about the promised retiree life insurance debacle.

New Retiree Council to Advise Sears
January 17, 2001

Seventeen Sears Retiree Club presidents have agreed to be part of the newly established Sears Retiree Advisory Council. The leadership group will meet for the first time January 31-February 1 in Scottsdale, Arizona. New Chairman and CEO Alan Lacy will welcome the group and representatives of his management team will lead the forum which will cover current directions for Sears as well as a variety of retiree issues.

"Our hope is that the Council will help us to better understand the broad range of issues that are important to our retirees," says Steve Mulligan, Sears director of corporate communications. " We will look to them for advice and counsel on current and new Retiree programs and benefit issues, as well as for ideas on how to improve our communications to our 150,000 Sears retirees."

The Council is the latest in a number of retiree communication initiatives that have been launched in the last 18 months, including the Sears Retiree News quarterly newsletter, Sears Retiree Website and monthly communication packets to Sears Retiree Club presidents.

The two-day meeting will include working sessions that will determine the future role of the Council as well as issues to be tackled. Plans are for the Council to serve as a conduit to the 275 plus Sears Retiree Club presidents, bringing their ideas and suggestions to the Council for review and recommendation to Sears.

Council members were invited to be part of the newly formed group based on the stated membership of their Clubs. "We tried to be as democratic as possible by inviting presidents of the largest clubs that represent all regions of the country," says Mulligan. "We've been very pleased with the enthusiastic response."

If you would like to share your comments and ideas for the Council, please e-mail them via the Feedback button. Write703@sears.com.

Sears Retiree Advisory Council

Lewis Babbitt, Sears Retiree Club of Chicagoland 
Francis Bagot, Southwest Florida Sears Retirees 
Roy Davis, Salt Lake City Retirees 
Tom Douglas, Sears Retired Executives (CA) 
Marvin Edwards, Memphis Retail Retirees 
Jim Griffiths, Stark County Sears Retirees (OH) 
Stanley Hreneczko, Sears Detroit Region Retirees Club 
Bob Hunt, Sears Active Employee Retiree Society (CO) 
Art Levin, Sears Arizona Retirees 
June Link, Sears Retiree Club of South Jersey 
James Nally, Sears Retiree Club of Washington (DC) 
Ruth Pilant, Central Texas Sears Retirees 
Lillian Richards, Sears Retirees Lehigh Valley (PA) 
Virginia Ruth-Shawver, Sears Best (KS) 
B.R. Lucky Silva, Sears Coral Gable Retirees (FL) 
Charlotte Sturgill, Fort Wayne Sears Retirees (IN) 
Nadine Trollinger, Kansas City Sears Retirees

EDITORS COMMENTS: 
Contact your president and ask him to be supportive of narse and at the meeting ask for the reinstatement of our life insurance.

 

 

 

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