|  | | 2004 News and Press Releases | | |
HEADLINE NEWS:
A Penchant For Pension Suits – Plaintiff Law Firms Find New Cause Of Action In Suits Over Pension Plans Whose Worth Has Plummeted
Leigh Jones
Broward Daily Business Review. December 17, 2004
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EXCERPT: Employees who squirreled away portions of their pay-checks for retirement only to have their plans for the future dashed by stock scandals and employer bankruptcies are boosting business for attorneys scuffling over whom to blame. The plaintiffs are employees, former or present. The defendants are often huge, publicly traded companies, either suffering or bankrupt. And whether the actions involve 401(k) plans or so-called traditional pension plans, an increasing number of attorneys are working on cases where a company's retirement well is running low. Yet despite the rush of recent lawsuits, resolution most likely will be slow in this largely untested area of the law. "There's a body of law evolving, but it doesn't answer a lot of penultimate questions," said Proskauer Rose partner Myron Rumeld. … Different from typical shareholder actions where plaintiffs allege damages when stock prices plummet upon news of alleged accounting fraud, most of the current ERISA actions claim that plaintiffs, such as employees who own their employers' stock as part of their 401(k) plans, lost money when their value sank. Keller Rohrback was a pioneer in 401(k) company-stock cases, said Sarko, a former associate at Arnold & Porter of Washington and clerk for 9th U.S. Circuit Court of Appeals Judge Jerome Farris. He points to a seminal ERISA case that his firm handled, Whetman v. Ikon. The Ikon case, among other things, recognized ERISA class actions as separate from shareholder securities actions. The court held that ERISA claims were not subject to the stringent pleading standards required in many securities cases. |
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