The RadioShack 401(k) Plan and ESOP are being sued in the Northern District of Texas. A brief look at the complaint shows that this is primarily a company stock drop suit. These suits are becoming as routine as shareholder derivatives following a stock decline, but two things stand out in this complaint:
- Although RadioShack stock has been very volatile, over the past decade it has actually outperformed the S&P 500. Over a five-year holding priod, returns have been only slightly negative. It is hard to see how plaintiffs will establish imprudence or damages without any long-term losses.
- Tacked onto the end of the complaint is a claim that the 401(k) plan’s mutual fund fees were excessive. Is this a sign that 401(k) fee suits are becoming so routine that plaintiffs are beginning to tack these claims onto every class action?
2 responses so far ↓
1 Carnival of Employee Benefits #5 // May 25, 2007 at 6:00 pm
[…] Hoes of the ERISA Class Action Watch provides a copy of the Complaint in Radio Shack Hit with Stock Drop & Fee Suit, commenting that tacked onto the end of the lawsuit is a claim that the 401(k) plan’s mutual […]
2 Suzanne Wynn // May 26, 2007 at 10:44 am
Great post. I included a link to it in this week’s Carnival of Employee Benefits, posted at my blog, the Pension Protection Act Blog - http://www.qualifiedpensionconsulting.com/ppablog. Terrific blog. Tackling the topic of ERISA class action suits provides such a great service to the ERISA community.
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