‘Leaching’ Retirement Savings?
Lockheed not only relied on these underwhelming funds but actively promoted them to employees, allegedly misleading workers into believing they were the best—and in some cases, the only—investment choices. The company also automatically enrolled employees into these funds if they failed to make a selection themselves.
With Lockheed’s retirement plans managing $50 billion in total assets for around 180,000 plan participants, the financial stakes are enormous. The lawsuit claims that, instead of removing the underperforming funds in 2019 when their weaknesses became clear, Lockheed expanded their use—introducing new funds for younger employees targeting retirement dates in 2065 and 2070.
“In essence, contrary to what loyal fiduciaries would have done, defendants ran a leaching operation that extracted value from plaintiffs’ retirement savings,” the workers argued in the filing.
The lawsuit seeks to represent all participants in Lockheed’s retirement plans from March 19, 2019, to the present, aiming to recover the alleged financial losses suffered due to Lockheed’s investment decisions.
