Third Point founder Daniel Loeb has cancelled a planned appearance at a Washington, D.C., institutional investor conference after representatives of a national teachers' union threatened to question his stance on defined-benefit pension plans.
Loeb had been scheduled to speak on a Council of Institutional Investors panel with California State Teachers Retirement System corporate governance chief Anne Sheehan and Jana Partners' Barry Rosenstein. Rosenstein will still appear, but Loeb pulled out yesterday.
The American Federation of Teachers had threatened to confront Loeb with his alleged opposition to defined-benefit pensions at the conference. The union says it is wrong for hedge fund managers like Loeb to market their wares to such plans while seeking their end.
Loeb said in a letter to the CII that his position on defined-benefit plans has been twisted.
"Over the past week, incorrect statements about my positions on the issue of defined-benefit pension plans have been made in conjunction with my planned appearance at CII's conference," Loeb wrote. "I have never taken a position against DB plans nor has any philanthropic organization I lead."
The AFT has cited Loeb's support for StudentsFirst, an educational reform group which has urged states to "move from defined benefits to retirement plans that are more sustainable," and his position as a board member of the Manhattan Institute, which also supports an end to defined-benefit plans.
"I deeply regret but understand Dan Loeb's decision," Sheehan said.
The AFT today plans to issue a list of 34 hedge fund executives it claims are opposed to defined-benefit plans, including Loeb, Elliott Management's Paul Singer and AQR Capital Management's Clifford Asness.
"Does the American Federation of Teachers think they should divest?" Michael Powell, an assistant to AFT President Randi Weingarten, asked of teachers' union pension plans. "The answer would be yes."
"I have an issue with people thinking they can play both sides," Jay Rehak, president of the Chicago Teachers' Pension Fund, told The Wall Street Journal. "They come to us with their hand out, and then they are stabbing us in the back."
"My support for and contribution to DB Plans is demonstrated by maximizing returns for union members who rely on us to deliver their pension goals," Loeb wrote.