A federal judge has permitted the Department of Labor access to documents amassed by plaintiffs' attorneys in claims against two of Northrop Grumman's defined contribution plans.
The case, Grabek v. Northrop Grumman Corp., is a long-running fee and expense class-action against the Virginia-based defense contractor.
U.S. federal Judge Jacqueline Chooljian partially granted the DOL's motion to intervene, permitting the plaintiffs' attorneys to release all documents they created or obtained. The DOL's own investigation of Northrop is separate from the class-action.
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The plaintiffs in the suit – represented by St. Louis, Missouri-based Schlichter, Bogard & Denton – alleged Northrop passed unreasonable expenses for third-party providers and administrators onto the plans, and that it failed to disclose to participants the costs of the plans in proper detail.
Northrop filed a motion to dismiss that was granted in California's Central District in August of 2007, on the grounds that the matter was best for the DOL to consider.
But in July of 2009, the 9th Circuit Court of Appeals vacated the lower court's dismissal of the case, and ordered the case to be reheard under a different judge, an unusual action by an appellate court.
In the appeal, the DOL submitted an amicus brief to the 9th Circuit, arguing that ERISA was clear in allowing participants to bring action against sponsors, even if the DOL has not.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
