<nobr>Mar 10, 2005</nobr>

ERIC Files Amicus Brief in Class Action Case: Langbecker v Electronic Data Systems (EDS)

ERIC filed a brief amicus curiae ("friend of the court") March 8, 2005 in Langbecker v Electronic Data Systems (EDS). The brief, in which ERIC was joined by the ESOP Association and the American Benefits Council, argues strongly against the certification of a class action lawsuit by the trial court. The case is before the Fifth Circuit Court of Appeals on an interlocutory appeal in which the appellate court was asked to intervene to decide the class action and other issues prior to a final determination by the trial court.

EDS has been sued in a class action in which plaintiffs allege that plan participants should have been protected against a decline in the value of EDS stock which is one of 17 options offered in the 401(k) participant directed plan. Plaintiffs contend that the employer stock should have been suspended from among the various options when the company allegedly knew that the value of the stock was diminishing. Moreover, plaintiffs contend that their remedy should be valued on the highest return from among the other investment options. According to EDS, however, plaintiffs continued to trade in EDS stock after allegedly suffering a loss and have profited from the increase in the stock that they continued to hold and in some cases buy.

Plaintiffs seek to bring the action not on behalf of themselves but as a "derivative" action on behalf of the plan. ERIC's brief argues the narrow issue that the plaintiffs in the case have not met the burden of meeting the standards necessary to bring a class action.

A copy of ERIC's brief is below. For further information, including other briefs, in this case contact Mark Ugoretz at ERIC.

Mark J. Ugoretz, President
The ERISA Industry Committee
1400 L Street, NW Suite 350
Washington, DC 20005
Tel: 202.789.1400 Fax 202.789.1120
http://www.eric.org

Websites:

ERIC Amicus Brief: Langbecker v Electronic Data Systems (EDS)

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