Lockheed Martin sued over pension buyouts

Four Lockheed Martin Corp. retirees have filed a lawsuit against the company, alleging a violation of fiduciary duties related to two recent pension buyout transactions.
The lawsuit, Konya et al vs. Lockheed Martin Corp., was filed in U.S. District Court in Baltimore on March 13 and alleges the defense and aerospace company violated its duties under the Employee Retirement Income Security Act of 1974 in transferring a total of $9 billion in U.S. pension plan liabilities to Athene Holding subsidiaries.
According to the court filing, the plaintiffs are seeking class-action status and allege that Lockheed Martin has not fulfilled the requirements of ERISA that say corporations when completing buyout transactions require fiduciaries use the “safest annuity possible.” The filing cites Athene as a “private-equity controlled insurance company with a highly risky offshore structure.”
It is the second high-profile lawsuit by retirees against their plan sponsor this week. Four AT&T Inc. retirees filed a lawsuit March 11 in U.S. District Court in Boston against the telecommunications giant and independent fiduciary State Street Global Advisors, alleging a violation of fiduciary duties related to a 2023 pension buyout transaction.
The Lockheed Martin suit, meanwhile, is the result of the company’s gradual derisking process it has undertaken for the past several years. The most recent buyout transaction took place in 2022 when the company transferred about $4.3 billion in liabilities, which represented the about 13,600 U.S. retirees and beneficiaries, to Athene's wholly owned subsidiaries Athene Annuity and Life Co. and Athene Annuity & Life Assurance Company of New York.
In August 2021, the company purchased contracts from the same two Athene subsidiaries to transfer the benefit-paying responsibilities of about 18,000 U.S. retirees and beneficiaries from the two pension plans to the insurer, offloading $4.9 billion in pension liabilities.