Major Hedge Fund Owner and FairPoint Investor Says Company Must Treat Workers Fairly

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FOR IMMEDIATE RELEASE, September 23, 2014

Contact:
Amy Masciola, 202-285-6955, amy.masciola@gmail.com

Unions Call on Angelo, Gordon to Push Company to Return to Bargaining

Augusta, ME–On September 5th, Angelo, Gordon & Co. president Lawrence Schloss responded to New York State Comptroller Thomas DiNapoli’s request that the hedge fund’s CEO urge FairPoint “to find common ground with its workforce” in the current labor dispute in northern New England. In addition to owning almost 20 percent of FairPoint stock, Angelo, Gordon & Co. has a designee on FairPoint’s board of directors.

DiNapoli is sole Trustee of the New York State Common Retirement Fund (CRF), the nation’s third largest public pension fund. The CRF is an investor in the AG Super Fund, a hedge fund managed by Angelo, Gordon & Co.

According to Schloss, “Angelo, Gordon agrees with [DiNapoli’s] belief that a company with a constructive relationship with its workers will become a stronger, more profitable and more enduring enterprise.” Furthermore, Schloss said the hedge fund owners believe that, “FairPoint must treat its workers fairly and in compliance with all laws.”

Schloss went on to say that the hedge fund owners have communicated to FairPoint that “we are against the termination of defined benefit and retiree health plans where there are other cost reductions available that can obtain similar financial savings.” Schloss concluded, “Angelo, Gordon has made clear its desire that both the company and the employees be willing to make the concessions necessary to reach a long-term agreement.”

Leaders of the unions representing almost 2,000 members at FairPoint Communications in Maine, New Hampshire, and Vermont welcomed Schloss’s intervention on behalf of FairPoint’s largest investor, but called on him to take additional action to resolve the dispute. “While we are pleased that Mr. Schloss has responded to Mr. DiNapoli’s concerns, we call on Angelo, Gordon to go further,” said Peter McLaughlin, chairman of the International Brotherhood of Electrical Workers (IBEW) System Council T9 and co-chairman of the unions’ bargaining committee. “Our bargaining team has been willing to compromise with the company from the beginning, offering counter proposals that would save the company more than $200 million, but the company has rejected every substantive proposal we’ve put forward. We urge executives at Angelo, Gordon to use their influence as the largest owner of FairPoint stock to persuade company negotiators to return to the table and engage in meaningful bargaining.”

Union leaders said they would continue to educate investors, the board of directors, and the public about the company’s attempts to destroy good jobs in northern New England and the impact on customers of FairPoint’s indiscriminate cost cutting. “Mr. Schloss claims that the company wants a swift and fair resolution, and maybe that’s what FairPoint CEO Paul Sunu has told his board of directors and his biggest investors,” said Don Trementozzi, president of the Communications Workers of America (CWA) Local 1400 and co-chair of the unions’ bargaining committee. “However, if that were true, why has the company abandoned the bargaining process after months of refusing to compromise on any proposal? If that were true, why has the company imposed terms and conditions on its workers that allow them to outsource all our jobs to out-of-state and foreign contractors? Actions speak louder than words. If Angelo, Gordon really wants a swift resolution, it should urge FairPoint to return to the bargaining table immediately and bargain in good faith.”

IBEW System Council T9 includes local unions in Maine, New Hampshire, and Vermont and represents nearly 1,700 employees at FairPoint Communications. CWA Local 1400 represents nearly 300 FairPoint employees in the three states.