Magistrate Judge Recommends Dismissing PRT Case Against Allegheny Technologies 

A magistrate judge in Pennsylvania recommended dismissing a pension risk transfer complaint against Allegheny Technologies Inc., concluding the plaintiffs lack standing to sue.  

U.S. Magistrate Judge Kezia Taylor, presiding in U.S. District Court for the Western District of Pennsylvania, wrote that the plaintiffs in Schoen et al. v. ATI Inc. et al. failed to properly show that they had suffered an injury following the transfer of $1.5 billion in pension obligations by the company to Athene Annuity & Life Assurance Co. 

The plaintiffs claim the pension fund’s trustees violated fiduciary duties under the Employee Retirement Income Security Act by not following a prudent process when selecting Athene as the annuity provider. This alleged failure, the plaintiffs argue, significantly increased the risk that they would not receive their full pension benefits.  

However, Taylor pointed out that the plaintiffs have been receiving their monthly payments as they did when the plan was administered by their employer. 

Dismissing a complaint for lack of standing is more significant than dismissing it on other grounds, because it could potentially discourage similar complaints from being filed. In a separate PRT complaint, also decided after being considered by a magistrate judge, the U.S. District Court for the District of Massachusetts dismissed a PRT complaint against AT&T but found the plaintiffs did have standing.  

According to Davis Harman LLC, which represents employers in ERISA cases, there are 10 outstanding PRT complaints currently being considered in U.S. courts. Six of those, including Schoen, have received an initial judicial opinion, two of which survived a motion to dismiss; three were dismissed.  

Schlichter Bogard LLC represents the plaintiffs, and Morgan, Lewis & Bockius LLP represents the defendants in the Allegheny Technologies case.