Pension Benefit Guaranty Corporation us- 1200 K Street. N.W.. Washington, D.C. 200054026 

March 27, 2003 

Re: Appeal No. 2003-0382; Trans World Airlines, Inc. 

(TWA) Retirement Plan for Pilots (the Plan) 

The Appeals Board reviewed your appeal of PBGC1s September 13, 

2002 determination of your PBGC benefit. For the reasons stated 

below, we must deny your appeal. 

PBGC determined that you are entitled to a PBGC benefit of 

$2,221.59 per month starting on your Actual Retirement Date 

(June 1, 2001) payable as a Modified Cash Refund Life Annuity 

(MCRLA) .' PBGC included a Benefit Statement, which shows 

information the former Plan administrator (TWA) used to calculate 

your Plan-defined benefit. The Statement also shows that PBGC used 

TWA's Plan-defined benefit amount to calculate your PBGC benefit. 

Your form-letter appeal said that (1) PBGC did not provide you 

with sufficient information on the analysis that underlies the 

determination, and (2) without such information, it is difficult 

for you to know whether errors not apparent to you were made. Our 

Discussion below addresses those issues, and the other issues you 

raised. 

Discussion 

3. Request for Additional Information 

Because your appeal. requested more information about your 

benefit calculation, the Appeals Board sent your request to PBGC1s 

Disclosure Officer and informed you in a letter dated November 14, 

2002 that you had the option of supplementing your appeal within 30 

days after his response. PBGC records show that the Disclosure 

Officer responded to your request on November 26, 2002 with copies 

of the documents in your personal PBGC file. One of those 

documents shows how your Plan benefit was determined. See 

1 Your MCRU pravi'des a benefit for the rest of your life. Also, because the 

Plan's former sponsor made special contributions on your behalf, you beneficiary 

will receive a benefit if you die before you receive pension payments equal to 

the special contributions balance. 
Enclosure 1. The Appeals Board has not received any supplemental 

correspondence from you. 

2. Calculation of Your Plan-Defined Benefit and Your PBGC Benefit 

After the Plan terminated on January 1, 2001, PBGC personnel 

conducted an audit of the procedures TWA used in administering the 

Plan and calculating participants' Plan-defined benefits. After 

calculating benefits for a sampling of participants and comparing 

the results with the amounts that TWA calculated and stored in 

TWA's pension database, PBGC auditors concluded that the benefit 

amounts in TWA's database were reliable. So, in most cases and in 

your case in particular, PBGC accepted TWA's calculations, and then 

adjusted them to account for (1) pre-age-62 supplements, (2) early 

or late retirement, (3) annuity types selected by participants 

and/or their spouses, and (41 limitations on benefits set by 

Congress under the Employee Retirement Income Security Act of 1974, 

- as amended (ERISA). 

Documents in PBGC files reveal that the Plan did not have 

sufficient assets when it terminated on January 1, 2001 to provide 

all benefits that PBGC guarantees under ERISA. As a result, the 

provisions of the Plan, ERISA, and PBGC's regulations and policies 

determine the amount of: 

your guaranteed benefit, 

D your ERISA 5 4044 benefit, and 

P your ERISA 5 4022 (c) benefit. 

Enclosure 2 shows how PBGC calculated these benefit amounts. 

PLEASE NOTE that PBGC will always, even after an appeal is 

closed, consider any 5, specific evidence that you present 

showing that you may be entitled to a higher benefit. If you have 

or obtain any such evidence, PBGC will certainly review it. Please 

send any such information to PBGC's Insurance Operations 

Department, Attention: Trusteeship Processing Division #1, at P.O. 

Box 19153, Washington D.C. 20036. If you need additional 

information from PBGC, please call the Customer Service Center at 

1-800-400-7242. 

3. Federal Litigation 

Your form-letter appeal includes claims that are being 

litigated against PBGC and other parties in two federal courts. 

The plaintiffs in the court cases allege among other things that 

the Plan was improperly terminated under ERISA. The form letter 
says that you are raising these issues in order "to ensure that all 

my rights with respect to the issues in contention in those 

litigations are fully preserved." 

By way of background, Carl Icahn was the former controlling 

shareholder of TWA. TWA filed a bankruptcy petition in 1992 in the 

Bankruptcy Division of United States District Court for the 

District of Delaware. One of the issues involved in the bankruptcy 

was the status of TWA's underfunded pension plans, and the extent 

of Carl Icahn's liability, if any, in the event the plans 

terminated. Among other things, Mr. Icahn conditioned his 

willingness to provide TWA with a $200 million loan (which was 

necessary for TWA to survive and emerge from bankruptcy) upon some 

provision that fixed the amount of liability that he might incur 

towards the pension plan. Throughout these proceedings, the 

interests of the retired and active pilots were represented by the 

Air Line Pilots Association (ALPA). 

On January 5, 1993, TWA, ALPA (and other unions that 

represented TWA employees), and PBGC signed a "Comprehensive 

Settlement Agreement" (CSA) under which: (1) Carl Icahn would loan 

TWA $200 million; (2) an Icahn-owned concern called Pichin took 

over sponsorship of the TWA Pension Plans, and agreed to become 

responsible for any minimum funding costs of the Plans that were 

not covered by a $300 million payment guaranteed by TWA; (3) it was 

agreed that the Plans would terminate if certain events occurred 

after 1993; and (4) if the Plans were thereafter terminated by 

PBX, it was agreed that Icahn would pay PBGC $240 million dollars. 

The Bankruptcy Court approved the CSA, and it was later 

incorporated in a Plan of Reorganization approved by the Bankruptcy 

Court. Neither ALPA nor any other party took an appeal from that 

decision, which became final and binding. 

The TWA Pension Plans were terminated in 2001. Even though 

ALPA was one of the parties that negotiated and signed the CSA, it 

filed a suit to stop the termination and void its own aettlement 

agreement. Judge Ricardo Urbina of the United States District 

Court for the District of Columbia dismissed the case on March 29, 

2002. Also, the Allied Pilots Association has assumed 

representation of former TWA pilots, and it is now litigating the 

appeal of Judge Urbina's ruling1. Furthermore, on May 15, 2002, 

eight former TWA pilots filed another lawsuit challenging the 

termination, also in Washington, D.C. The judge postponed 

litigation in the second case until the appeal of the first case is 

decided. 

1 A copy of Judge Urbina's decision (http://www.dcd.uscourts.gov/00-3113.pdf) 

is available on the court's wcbsite ~http://mw.dcd.uscourts.gov/).