Opinion ID: 683147
Heading Depth: 2
Heading Rank: 1

Heading: Public Disclosure of Allegations

Text: 9 The district court based its dismissal in part on statements made at a creditors' meeting following CF & I's bankruptcy filing. At that meeting, Frank Cummings, counsel for CF & I, said: 10 [T]here were what we believe to be miscalculations, putting the kindest possible face on it, by the actuary for this plan who was retained by the former parent of the company, Crane. And those miscalculations--it is a pejorative term. Those calculations which did not display what we believe should have been displayed were not discovered until at or about the time of the spin-off which occurred in 1985. 11 The district court viewed this statement as tantamount to a public allegation of fraud. 12 Cummings also stated, however, that the rise in the unfunded pension liability after the spinoff was the result of a number of additional factors: actuarial assumptions, downsizing in the steel industry (where special early retirement benefits arise when facilities shut down), and discount rate changes all contributed to the massively underfunded debt. Moreover, Cummings also said that [y]ou can be underfunded in this universe in any industry including steel simply by obeying the law that allows a forty-year amortization period for the pension liability. When viewed in this context, Cummings' offhand remark, although hardly complimentary, is by itself insufficient to rise to the level of a public allegation of fraud on the part of Crane.