California ERISA Lawsuit Drags on for a Decade, Remains Unresolved

0 Comments
By

Los Angeles, CA: In the latest salvo of an ERISA lawsuit that’s been ongoing for a decade now, employees of Northrop Grumman Corp. (plaintiffs in the ERISA complaint) this week made a request to a federal judge in California asking that certain witnesses for the defense should be blocked from testifying, together with various audits performed by the US Department of Labor (DOL). The plaintiffs hold that audit documents, and the testimony from the named witnesses, should be deemed as inadmissible.

It was in September of 2006 that four class representatives launched a putative class action lawsuit against defense giant Northrup Grumman – together with three committees and a handful of executives – over the alleged mismanagement of two 401(k) plans under ERISA.

The Employee Retirement Income Security Act (ERISA, as amended 1974) is designed to protect investors and members of group retirement plans. Plan managers have various fiduciary duties to the plans, and to plan members, and are required to conduct investments and management related to ERISA plans with the best interests of the members at the forefront, rather than for any perceived benefit of the employer or any other parties.

The ERISA lawsuit was originally filed in US District Court for the Central District of California. In addition to the lawsuit filed in 2006, another employee of Northrup Grumman with an ERISA lawyer in tow filed a similar class action, in the same court, in 2007. Four years later, in 2011 US District Court Judge Margaret M. Morrow, the original justice assigned to the case, certified two consolidated putative class action lawsuits – but not before an appellate court became involved, deeming the relief appropriate in the two cases.

Judge Morrow was later petitioned, in December of 2015, to reconsider a partial order of summary judgement. The plaintiffs had since petitioned US District Court Judge Andre Birotte Jr., who was reassigned to the case and took over from Judge Morrow, to consider the possibility that Judge Morrow had failed to consider a precedent previously rendered under the US Court of Appeals for the Ninth Circuit, regarding if receipt of retirement account statements constituted “actual knowledge” of an underlying violation subject to a three-year statute of limitations, rather than depending upon what the plaintiffs referenced as a mistaken reading of a decision by the US Supreme Court.

Judge Birotte Jr. determined that the district court, under Judge Morrow, had committed “no clear error in ruling that the plaintiffs’ receipt of communications disclosing the selection of the high-fee funds was sufficient to give plaintiffs actual knowledge of their investment fees claim.”

Judge Birotte Jr. rendered his decision on that matter in March of last year. Next month, a bench trial is scheduled for March 14. The plaintiffs involved in the two consolidated ERISA class actions, made their overtures to Judge Birotte Jr. ahead of that bench trial starting.

The specifics of the allegations involved in the alleged mismanagement of 401(k) funds under ERISA, were not spelled out.

The ERISA lawsuit is In Re Northrop Grumman Corp. ERISA Litigation, Case No. 06-cv-06213 in US District Court for the Central District of California.

You might also like

No Comments

Leave a Reply


Note: Your name will be published with your comment.


Your email will only be used if a response is needed.


Legal Help Form

Please complete this form to request a review of your complaint by an attorney.