U.S. to Pay Share of GM Pension Deficit

General Motors Corp. and other government contractors can recover some pension shortfalls from the U.S. government, a federal judge ruled.

Judge Nancy Firestone of the Court of Federal Claims in Washington ruled that the federal government must pay some share of the pension funding deficit accrued under flexibly priced contracts it had with Allison Gas Turbine, which GM sold in 1993. GM claims the government owes it as much as $252.8 million in defined-benefit pension contributions.

Detroit-based GM, the biggest U.S. automaker, has been seeking reimbursement of the costs, based on accounting adjustments as of the time of the Allison sale, since 2000.

“If the calculation results in a deficit, then the government’s share must be increased,” Firestone wrote in a June 28 opinion declining to dismiss the case. “The plaintiff is entitled to a settling-up.”

GM shares fell 55 cents to $34.22. The stock has fallen about 14% this year.