Lockheed 401(k) suit headed to trial

By BenefitsPro


By Nick Thornton

After eight years of legal wrangling, a trial date been set for the thousands of Lockheed 401(k) participants suing their employer for alleged breach of fiduciary duty.

The case of Abbot v. Lockheed Martin Corp. has seen appeal of district court finding by both the plaintiffs and defendants, and even a recent trip to the U.S. Supreme Court, which kicked the case back to the U.S. Southern District Court of Illinois, where the claims were first filed.

U.S. District Judge Michael Reagan set a tentative trial date of Dec. 1 for the trial to begin.

One last option remains to avoid the trial. In a memo released last week, Judge Reagan said he intends to appoint a retired circuit judge “for the purposes of mediating a resolution to this case.”

Jerry Schlichter, founding partner of the firm representing Lockheed’s employees, said he’s not holding out much hope for a settlement.

“We’re fully expecting to go to trial,” said Schlichter.

The Lockheed case is one of the first excessive fee cases filed by Schlichter, Bogard & Denton, a St. Louis, Mo.-based firm that went on to successfully bring excessive fee cases against some of the biggest plan sponsors in the country.

There are more than 100,000 Lockheed employees and retirees involved in the excessive fee claims against the Bethesda, Md.-based defense contractor.

The case originated on claims that excessive fees paid on mutual fund options were a breach of Lockheed’s fiduciary duty, that the Stable Value Fund was not properly disclosed to participants and was not a prudent investment, and that the Company Stock Fund was not a prudent investment.

Originally published on BenefitsPro.com