The court rejected Comcast’s assertion that a previous ruling in a case against Avaya Inc. extended protection for fiduciaries who decided to offer Comcast stock as an investment option since the plan is an eligible individual account plan (EIAP). In its opinion, the court pointed out that the Avaya plan mandated that company stock be offered as an investment option (See Court Finds Employees Missed ERISA Fiduciary Breach Case ) entitling Avaya fiduciaries to a presumption that it was prudent to offer company stock, whereas the Comcast plan only said company stock “may” be offered to participants.
However, the court dismissed plaintiff Robert Urban’s claim alleging a breach of the fiduciaries’ duty to “provide complete and accurate information,” citing the 3 rd U.S. Circuit Court of Appeals finding in Avaya “[t]hat defendants did not inform Plan participants about several adverse corporate developments prior to Avaya’s earnings announcement, [did] not constitute a breach of their disclosure obligations under ERISA.” (See Bad Corporate News Not Dire Enough to Dump Company Stock )
Finally, the district court moved forward Urban’s claim that Comcast breached its fiduciary duty to monitor other plan fiduciaries, finding Urban stated a claim upon which relief could be granted.
The case was brought on behalf of all those who were participants in or beneficiaries of the the Comcast Corporation Retirement-Investment Plan at any time between February 1, 2007 and the present. According to the opinion, during this time the plan’s fiduciaries painted a bullish picture for the future of the company to participants and the public even while the company was failing to reach sales goals, top company executives were selling their company stock holdings, and the company’s stock price was falling.
The opinion in Urban v. Comcast Corporation is here .
« Employers Oppose Govt. Health Coverage Requirement