Court rules that Owens Corning employees were too slow in suing pension fiduciaries
This week the Sixth Circuit Court of Appeals upheld a lower court's ruling that the fiduciaries who managed the Owens Corning pension and profit-sharing plans were entitled to a dismissal of the employees' claims. The employees brought suit in 2006, arguing that the various fiduciary defendants had not met their special duty to the employees in the management of the pension investments. Most employees' vested benefits (in some cases their own contributions) were wiped out when the value of company stock in their individual plans dropped in 1999 from $35 dollars per share to less than a dollar per share.
Originally, employees were required to invest in Owens Corning stock and the employees argued that as bankruptcy loomed for Owens Corning, the fiduciaries were negligent in failing to either move these investments or failing to advise employees to move them. The Court held, however, that the employees had all the facts they needed to file suit by 2003, and therefore their 2006 lawsuit was filed too late (beyond the statute of limitations which can be three or sometimes six years). They will not be able to pursue compensation from the fiduciaries for the loss of their retirement life savings.