'Now we're euchred,' one says after the Chapter 11 filing

By Danielle Kost and Frank Bilovsky
Democrat and Chronicle

(Tuesday, January 29, 2002) -- When Charles Faggiano retired in 1995 after spending two-thirds of his life working for Rochester Telephone Co. and later Frontier Corp., he expected a worry-free future.

He had worked hard for 38 years as a communications technician and figured he had earned some financial security and leisure time.

But that all changed Monday morning when Faggiano, 63, learned that Global Crossing Ltd. which purchased Frontier in 1999, filed for Chapter 11 bankruptcy protection.

The move made his 2,000 Global Crossing shares instantly worthless, he said.

"Most of the boys that retired were using that as an income or a nest egg," said Faggiano, who is also president of the Communications Workers of America Local 1170's retiree club. The union represents Frontier workers, many of whom became Global Crossing employees as the company changed hands over the last three years.

"Now we're euchred," Faggiano said. "We're going to have to tighten up our belts."

Roughly 150 to 200 retirees will be affected, said Linda McGrath, president of CWA Local 1170. Another 850 active union members, Frontier Corp. employees whose 401(k) retirement plans were invested largely in Global Crossing stock, will also be hit.

"We didn't expect the stock to be thrown away," McGrath said.

McGrath was concerned that union-represented Frontier employees' pension plans would also be affected. But Citizens Communications Co. has assured her that those pensions will be transferred to Frontier as part of its July purchase of Frontier, she said.

"We're just keeping our fingers crossed," she said.

William Scrymgeour, a 64-year-old Greece resident, has had his fingers crossed for the last several months as Global Crossing shares tumbled toward penny-stock status. The 14,000 shares of Rochester Telephone Co. stock that he inherited in 1974 had skyrocketed to $60 a share in early 2000.

"Now I'm out $700,000 or $800,000," he said glumly after listening to the Global Crossing news on CNBC. "I'm ready to blow my brains out at this point. The president of the company says the company is in great shape. No layoffs, no closing of anything, everybody gets paid. Everybody but the stockholders."

Scrymgeour said that he called his lawyer later in the day.

"I told him I know the creditors get paid and the stockholders are at the bottom," he said. "I have 15 copies of everything Global said, reported, whatever, since 1999. I was going to send them to Congress, the FCC and the SEC. But now that they are in Chapter 11, I don't believe there is a lot I can do by doing that. I think it would be a waste of time at this point."

So Scrymgeour said he'll bide his time until the new majority owners take over. But he hasn't lost hope of recouping some of his losses.

"After that, I told my lawyer, class action, whatever," he said. "He's going to keep track of it. Then we'll decide what to do."