Blitman & King achieves a significant win for retirement plan participants
A federal district judge allowed a proposed class of Eastman Kodak Co. workers to move forward with a lawsuit against fiduciaries of the company’s retirement plans (Gedek v. Perez, 2014 BL 355169, W.D.N.Y., No. 6:12-cv-06051-DGL, 12/17/14). Jules L. Smith, Blitman & King together with Mark P. Kindall and Robert A. Izard of Izard Nobel LLP represent the successful plaintiffs. The Kodak workers allege that the plan fiduciaries acted imprudently by keeping declining Kodak stock in the plan. In denying defendants’ motion to dismiss, the court found that the Kodak workers had cited a “damning” array of publicly available information detailing the company’s financial struggles and forecasting its bleak future and impending bankruptcy; “the point is that, according to the plaintiffs, over the course of the class period it became clear to all but the willfully blind that Kodak was headed for bankruptcy, and that its stock price had no reasonable hope of turning around.” This is one of the first rulings in an action challenging declining employer stock value since the U.S. Supreme Court revised the standards applicable to “stock drop” lawsuits in June 2014. See Fifth Third Bancorp v. Dudenhoeffer, 134 S.Ct. 2459 (2014).