Steamfitters Local 449, Pittsburgh, filed a lawsuit Thursday in federal court, claiming Austin Capital Management breached its fiduciary duty and liability under ERISA by investing in a feeder fund managed by Bernard L. Madoff Investment Securities.
The suit, filed in U.S. District Court in Pittsburgh on behalf of the unions $95.7 million pension fund, seeks class-action status. Also named as defendants are several Austin Capital Management executives and Austins parent company, Victory Capital Management, and its parent, KeyCorp, according to court filings.
Beginning in 2006, the Steamfitters fund invested a total of $7.9 million in Austin Capitals Safe Harbor Fund, which invested as much as 7.5% of its assets in the Rye Select Broad Market Fund which was managed by BLMIS, according to court documents. The suit seeks restitution of losses and legal costs.
Austin Capital Managements funds were closed in April. Executives of the firm and Victory Capital and KeyCorp executives could not be reached by press time for comment.