Lehman Brothers 401(k) Lawsuit

Current and former employees of Lehman Brothers who hold company stock in the Lehman Brothers 401(k) Savings & Investment Plan may have a claim to recover losses in their retirement investment.

On July 30, 2008, employees of Lehman Brothers Holdings, Inc. filed a lawsuit on behalf of current and former employees of the company who invested in the Lehman Brothers 401(k) Savings & Investment Plan between September 13, 2006, and the present. The lawsuit, which was filed in the U.S. District Court, Southern District of New York, alleges that Lehman Brothers violated the Employee Retirement Income Security Act of 1974 ("ERISA") by continuing to make and maintain investments in Lehman Brothers stock despite the company's alleged mismanagement of the risk of assets held by the company and its failure to maintain adequate capital and liquidity.

Under ERISA, Lehman Brothers employees can file a lawsuit if the Administrator of the Plan put employees' retirement savings at risk, thereby violating the Administrator's fiduciary duty to its employees. A fiduciary is the person who exercises discretion over the management of plan assets or exercises discretionary control over the administration of the plan. If a Plan Administrator imprudently invests employee retirement fund assets in the company's own stock, it may have breached its fiduciary duty.

At this point, several ERISA cases have been filed against Lehman Brothers in New York federal court. The employee/plaintiffs in these actions have moved to consolidate their cases and have proposed a leadership structure to designate the lead plaintiff(s) and lead counsel in the case. Once the preliminary matters of consolidation are discussed and deadlines established, the case will proceed. If the employees are successful, they will obtain recovery on behalf of all plan participants and beneficiaries.

If you have further questions about the lawsuit, please feel free to call our office toll free at 800.755.0098.