Lockheed Settles Revenue Sharing Lawsuit Hours Before Trial
Another 401(k) revenue sharing lawsuit moved toward settlement this week — hours before the trial was scheduled to begin.
Lockheed Martin Corp. agreed on Dec. 16 to settle a federal class-action lawsuit that had alleged the firm’s retirement plans charged excessive fees to more than 100,000 investors, and that the firm failed to prudently administer its stable value fund as an investment option.
Lockheed Martin had countered that such claims "are false," and that the aerospace firm and defense contractor was “committed to defending against the allegations at all stages of the litigation." In announcing the tentative settlement, Lockheed Martin said only that the details were being finalized.
According to published reports, the tentative deal averted an anticipated 4-week trial in the 8-year-old case, involving as much as $1.3 billion in potential damages. Terms of the settlement were not disclosed.
A trial without a jury, scheduled to start Dec. 15, was postponed for last-minute negotiations by U.S. District Judge Michael Reagan on Dec. 14. "The parties have battled over virtually everything, leading the court to refer to a recent skirmish as a 'tempest in a teapot,'" Reagan wrote, according to Bloomberg. "The aggressive, sometimes intractable stances the parties have taken at various times help illuminate why the case has not been settled." Reagan stated that he would not consider any proposed settlement once the first witness was called to testify, according to the report.
Reagan has scheduled a Jan. 8, 2015 status conference on the proposed settlement, using that to set deadlines for preliminary approval.