Court OKs Ford, GM health care settlements

A federal appeals court on Tuesday upheld two settlements that require union retirees of General Motors Corp. and Ford Motor Co. to pay more for their health care.

GM, Ford and the United Auto Workers union reached the settlements in 2005, and U.S. District Court approved them the following year. The settlements cover 472,000 retirees and dependents at GM and 172,000 at Ford.

About 2,000 retirees objected to the settlements and appealed to the 6th U.S. Circuit Court of Appeals. Among other issues, the objectors said the settlements violate the automakers’ promises that their health care benefits would continue after retirement. They claimed the UAW had too much influence in selecting the attorney who represented the retirees and that retirees were given inadequate information on how to challenge the settlements.

In a unanimous decision, the Cincinnati-based federal appeals court agreed with the lower court that the settlements were “fair, reasonable and adequate” and that retirees were properly represented and given adequate information.

GM has said the agreement would save $1 billion after taxes each year, while Ford said it would save $200 million annually.

•Server and software maker Sun Microsystems Inc. plans to cut an unspecified number of jobs as part of a new restructuring plan, according to a regulatory filing Tuesday with the Securities and Exchange Commission.

Sun said it expects to incur total charges of about $100 million to $150 million over the next several quarters, primarily related to cash severance costs. The company expects to book most of the charges in the first half of the fiscal year ending June 30, 2008.

The Santa Clara, Calif.-based company did not disclose how many jobs would be cut.

Sun has been aggressively cutting costs since Jonathan Schwartz took over as chief executive in April 2006 from co-founder Scott McNealy.

•A year after adding books to its growing entertainment lineup, Starbucks Corp. said Tuesday it will soon begin selling its third pick, a collection of 50 stories in an oral history project compiled on book and CD.

Edited by Peabody Award winner Dave Isay, “Listening Is an Act of Love: A Celebration of American Lives From the StoryCorps Project” will go on sale at Starbucks’ more than 6,500 company-operated U.S. stores beginning Nov. 8, the company said.