December 16, 2014 – Lockheed Martin on Tuesday reached a tentative settlement with participants in its massive 401(k) plan who sued the defense contractor in federal court for allegedly allowing excessive fees to needlessly erode the value of the plan.
The provisional settlement is the latest development in a series of cases filed by St. Louis attorney Jerome J. Schlichter that are reshaping the options companies offer employees for investing the trillions of dollars held in 401(k) retirement accounts. With the continuing demise of traditional pension plans, 401(k)
In the complaint against Lockheed, workers and retirees accused the company of offering retirement investment options that in some cases cheated them of potential returns and, in others, charged needlessly high fees. The result, they said, was that plan participants missed out on hundreds of millions of dollars in investment returns that could bolster their retirement income.
“At best, these fee structures are complicated and confusing when disclosed to Plan participants,” the complaint said. “ At worst, they are excessive, undisclosed, and illegal.”
Lockheed has denied the allegations.
With $26 billion in assets and more than 150,000 participants, Lockheed’s retirement plan is among the nation’s largest.
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