DOL Eyes Amicus Filing While States, Industry Back Lockheed Martin in PRT Case 

A growing chorus of government and employer voices has lined up behind Lockheed Martin Corp. in its high-profile appeal backing the legality of a pension risk transfer challenged by retirees. 

The case, Konya v. Lockheed Martin Corp., now before the U.S. 4th Circuit Court of Appeals, could shape the future of the PRT market, which has continued to grow in recent years. 

For example, single-premium buy-in sales—when the pension liability and the annuity contract to pay it stay on the company’s books—jumped 328% in the third quarter to $4.3 billion, according to LIMRA’s U.S. Group Annuity Risk Transfer Sales Survey, the highest-recorded quarterly sales for buy-in products. 

Meanwhile, in other ERISA litigation news, the solicitor general urged the Supreme Court to review two pending Employee Retirement Income Security Act cases and to side with the defendant employers, Parker-Hannifin Corp. and The Home Depot Inc. The Supreme Court, in April, asked the solicitor general to weigh in on a 401(k) excessive fee lawsuit against Home Depot. The high court, in July, sought federal input on the Parker-Hannafin case, which is about whether the company violated ERISA by retaining target-date funds that were high cost and underperformed their benchmarks.

The briefs, submitted Tuesday in collaboration with attorneys from the Department of Labor, represent a notable departure from the DOL’s historical position. Previously, the agency has typically supported employees in litigation, but in these cases, the government is advocating for the employers. 

DOL Signals Possible Support for Lockheed 

The U.S. Department of Labor asked the 4th Circuit on December 5 for more time to decide whether to file an amicus brief in support of Lockheed Martin, citing the need for internal consultation with the solicitor general, as well as leadership changes at the department. The agency noted that recent funding lapses had delayed its review and requested a 30-day extension—a motion the court granted on December 9, giving the DOL until January 9, 2026, to weigh in. 

The DOL motion emphasized its “primary authority to interpret and enforce” the Employee Retirement Income Security Act and its interest in maintaining “uniformity of enforcement” in the retirement law’s application—signaling that its eventual position could have nationwide ramifications. 

State Attorneys General Defend Insurance Oversight 

The same week, Iowa and nine other states—Alabama, Arkansas, Idaho, Indiana, Louisiana, Montana, Nebraska, Oklahoma and Texas—filed an amicus brief asserting that the plaintiffs in the case lack standing to sue because they have suffered no injury as a result of the PRT deals. The states argued that PRT transactions, in which pension obligations are transferred from an ERISA-governed plan to a state-regulated insurer, are safe and overseen by regulators. 

The retirees’ lawsuit “is a collateral attack on State regulation of insurance,” according to the states’ brief, which stressed that insurers like Athene USA Corp. (Lockheed’s partner in the transaction) are well-regulated by “adept and well-equipped state regulators” and that “not a single pensioner has lost a single penny from a pension risk transfer transaction in decades.”  

Employer Groups Warn Against ‘Speculative’ Litigation 

Three of the nation’s largest employer advocacy organizations—the ERISA Industry Committee, the American Benefits Council and the Committee on Investment of Employee Benefit Assets—also filed a joint brief on December 10 supporting Lockheed’s appeal. The coalition contended that the retirees’ claims rest on “speculative” allegations and threaten to chill lawful corporate pension management. 

“Plaintiffs do not cite a single instance … in which any participant was paid less than their ERISA plans would have paid them,” the brief stated. “Despite the complete absence of any participant harm, the large dollar values of these transactions make them attractive targets for class action litigation.” 

The employer groups’ filing echoed the themes in previous amicus briefs filed by the companies, which described the case as part of a “flurry of PRT lawsuits” that “have not caused any concrete or certainly impending harm,” but have “a real chilling effect on these legally permissible transactions.”  

Legal Context: Standing at the Center 

The appeal to the 4th Circuit concerns whether retirees can sue over PRTs at all. Lockheed Martin argues that because the plaintiffs continue to receive the same benefits on the same schedule, they lack standing—a position reinforced by the employer groups and states that filed friend of the court briefs, as well as by judges in their reasoning for dismissing similar cases. A judge in U.S. District Court for the District of Maryland denied Lockheed’s motion to dismiss, allowing discovery to proceed, but the appellate court agreed to hear an interlocutory appeal on the standing issue. 

The DOL’s potential entry into the case could prove pivotal: The agency’s interpretation of ERISA fiduciary duties in pension transfers would carry considerable weight, and its brief could either reinforce or complicate Lockheed’s defense. 

Retiree Perspective: A Sense of Unease 

While corporate and government filings stress regulatory safeguards, retirees remain wary. Tommy Steed, chairman of the Association of BellTel Retirees, a nonprofit organization seeking to protect workers’ pension benefits, describes the loss of federal ERISA protections when a pension is transferred to an insurer-backed annuity as “a huge loss.” 

Under ERISA, he says, retirees received annual plan disclosures, and the Pension Benefit Guaranty Corporation guarantees lifetime benefits, even if the former employer became insolvent. Under state insurance guaranty schemes, he warned, protections are patchwork—capped between $250,000 and $500,000, depending on the state—and “after you hit that cap, you’re done.” 

He says many retirees “don’t even know what happened” when their pension checks suddenly began coming from an insurance company instead of their former employer. 

“We’re terrified this trend is creeping across America,” he says. “People don’t realize the risks until it’s too late.” 

In 2012, the association sued Verizon in an effort to stop the $8.4 billion transfer to Prudential of pension assets covering 41,000 retirees. Though Steed says there have only been “minor conflicts” thus far, outside the loss of PBGC and other legal protections, he says the transfers put retirement assets at risk, since retirees do not know enough about the insurers’ investments. 

“We don’t know where they’re going, and we don’t think that they’re invested prudently,” Steed says.