A class action lawsuit has been filed in Kansas federal court against Sprint Nextel Corporation, alleging they violated the Employee Retirement Income Security Act. The lawsuit claims the violation occurred when Sprint Nextel failed to remove its common stock as an investment option for employees which caused the German telecom giant's retirement savings plans to suffer tens of millions of dollars in losses.
The complaint indicates that Sprint Nextel should have known as early as May 2007 that its stock was an unwise investment for employee savings plans, citing statements about disappointing fourth quarter and full-year 2007 financial results announced in February by Dan Hesse, Sprint Nextel CEO. The lawsuit goes on to say that has Sprint Nextel performed their fiduciary and/or co-fiduciary duties the plans would have avoided a substantial portion of the losses. The plaintiffs will be investigating whether the company's administrators bear any responsibility by failing to prudently and loyally manage the savings plans' investments.
