Roseville (Mich.) Employees’ Retirement System filed a lawsuit Thursday against Textron, claiming the aircraft and industrial parts manufacturer misled investors about its stability and profitability.
The lawsuit, filed in U.S. District Court in Providence, R.I., claims that between July 17, 2007 and Jan. 29, 2009, Textron accepted orders for business jets from startup or distressed fleet operators “who neither intended to, nor possessed the financial resources to, pay for or take delivery of aircraft during 2008-‘09 and beyond. This practice materially inflated Textron’s ‘backlog’ of unfilled orders for the company’s Cessna segment, which in turn materially overstated the company’s current financial condition and future prospects.”
The lawsuit is seeking class-action status. The value of the plan’s holdings in Textron could not be immediately learned.
The Roseville pension plan was valued at $126.8 million as of June 2008, according to the 2009 Money Market Directory.
Textron spokesman Mike Maynard declined comment. Roseville board chairman John Chirkun could not be reached for comment by press time.