A federal judge on Friday said the U.S. Pension Benefit Guaranty Corp's lawsuit accusing billionaire Ira Rennert's Renco Group Inc. of trying to evade pension obligations of its RG Steel unit should go to trial, Reuters reported on Friday. U.S. District Judge Richard Sullivan in Manhattan rejected requests by both sides to decide the case in their favor. He scheduled a trial for July 6. The PBGC had sued Renco in January 2013 for $97 million, claiming that it sold a 24.5 percent RG stake to private equity firm Cerberus Capital Management LP mainly to escape the steelmaker's pension plans, which were underfunded by $70 million. The PBGC said that it had been preparing on Jan. 13, 2012 to terminate RG's pension plans, but agreed not to after Renco assured it would not imminently cut its ownership stake to below 80 percent, the level at which it would retain the pension liabilities. Instead, the PBGC said Renco did just that four days later when it sold a stake to Cerberus, saying the transaction would bolster RG's finances. The steelmaker ultimately filed for bankruptcy in May 2012, and the PBGC took responsibility for its pension plans six months later.
