Allegations Over 401(k) Forfeitures
The lawsuit, filed in March by former employees Laura Garner and Lawrence Adams, accused the Falls Church, Virginia-based aerospace and defense contractor of placing corporate interests ahead of retirement plan participants.
At the heart of the dispute was how Northrop Grumman used forfeited assets within its Northrop Grumman Savings Plan. The plaintiffs alleged the company redirected those forfeitures to reduce its own contributions, rather than applying them to lower or eliminate administrative costs borne by plan beneficiaries.
They framed the practice as a breach of fiduciary duty under ERISA — a statute designed to safeguard employee retirement benefits — and alleged prohibited transactions and a failure to properly monitor plan management.
But in December, Judge Trenga concluded those claims did not plausibly state a violation of federal benefits law. He dismissed the fiduciary breach and related claims, leaving standing only one narrower allegation: that Northrop Grumman failed to provide certain requested plan information, potentially triggering ERISA statutory penalties.
