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U.S. Steel Canada retirees seeking to get secret deal revealed

On Behalf of | Nov 30, 2015 | Civil Litigation |

Retirees from U.S. Steel Canada and the city of Hamilton, Canada, are making progress in their efforts to reveal a secret deal between the steelmaker and the federal government. The Ontario Court of Appeal approved the right of plaintiffs in the case to appeal a previous judge’s decision to maintain the secrecy of the agreement.

The controversial agreement was arrived at in 2011. Ottawa sued the U.S. Steel by citing the Investment Canada Act. Allegedly, the U.S.-based steelmaker did not fulfill the contractual promises it made prior to purchasing Stelco Inc. in 2007. Ottawa accused U.S. Steel of reneging on job and steel production promises. Meanwhile, U.S. Steel argued that it had faced unpredictable business difficulties due to steel market performance and it had no choice but to fail in its promises.

According to the more recent lawsuit filed by U.S. Steel Canada retirees and the city of Hamilton, the confidential settlement agreement between Ottawa and the steelmaker in the above case is an essential element of U.S. Steel’s affairs, as it has affected the benefits of retirees and other workers, and therefore it should be made available for scrutiny.

The first judge ruled that he did not have the power to declassify the agreement. However, the more recent ruling will allow the plaintiffs to move forward with appealing that decision.

The lawsuit to unveil this secret agreement is a part of U.S. Steel Canada’s larger goal of regaining financial stability by way of court-assisted creditor protection. In other developments on this front, the Hamilton city council unanimously voted in favor of a motion calling on federal and provincial governments to ensure that retirees and workers get their full benefits owed. Additionally, the province has moved forward with a $3 million transitional fund that will make sure retirees who have lost their benefits will get the funding they need for critical health services while they transition to other available programs.

The secrecy of a confidential settlement agreement can be challenged — as it has in this case. Particularly if the agreement will affect an interested party that was not included in settlement discussions, that interested party might be able to pursue legal action to declassify the document.

Source: The Hamilton Spectator, “Retirees want secret U.S. Steel deal revealed,” Mark McNeil, Oct. 15, 2015