Great Northern Paper Bankruptcy Leaves 1,000 Maine Workers with Pennies on Dollar of Promised Pensions

Approximately 1,000 former Great Northern Paper workers in Millinocket and East Millinocket, Maine began receiving bankruptcy settlement checks representing ‘a small fraction’ of the pensions, vacation pay, and severance they spent decades earning at the once-dominant paper mills. Workers who expected six-figure pensions at full maturity instead received payouts as low as $345.54 after 15 years of bankruptcy proceedings. The most common individual payout totaled just over $1,000. Retired millworker Michael Manzo, who worked at the mill for 30 years, called it ‘a total ripoff,’ stating: ‘Of course, it is good to get a little money, but it is nothing compared to what we have lost. I thought there were supposed to be laws to protect us.’ Great Northern Paper, formed in 1899 and once producing 16.4 percent of all newsprint in the United States, filed for bankruptcy on January 9, 2003 after years of declining investment, international competition, and corporate ownership changes. The mills changed hands repeatedly through hostile takeovers and asset stripping: Georgia-Pacific acquired it in 1990 for $3.8 billion and sold to Bowater in 1991; Canadian company Inexcon bought it in 1999 and went bankrupt in 2002; Brascan/Brookfield Asset Management purchased it in 2003; and Cate Street Capital of New Hampshire acquired it in 2011. Brookfield laid off workers in 2008 before the mills closed in September 2008. When the bankruptcy case finally concluded on June 18, 2018, Great Northern had abandoned $203 million in assets, distributed only $15.5 million to claimants, and discharged $302.8 million in obligations without payment. The collapse devastated workers, many now at retirement age, who had joined Great Northern as teenagers or young adults expecting that mill work would provide economic security as it had for their fathers, grandfathers, and great-grandfathers. The Great Northern Paper bankruptcy exemplified how corporate ownership through private equity and asset management firms systematically extracted value from industrial communities while abandoning workers to poverty, using bankruptcy law to evade pension obligations earned through decades of labor.