Compliance

ERISA Stock Drop Suit Filed Against Exxon Mobil

Misrepresentations regarding climate change caused Exxon Mobil's stock price to be artificially inflated, the compliant says.

By Rebecca Moore editors@assetinternational.com | December 05, 2016
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A participant in the Exxon Mobil Savings Plan has filed a complaint on behalf of himself and other similarly situated current and former employees of Exxon Mobil Corporation, or its predecessor companies, alleging plan fiduciaries breached their fiduciary duties under the Employee Retirement Income Security Act (ERISA) by continuing to offer company stock when it was no longer prudent to do so.

The action was brought under Section 502 of ERISA to recover “many millions of dollars of damage suffered in their retirement accounts due to breaches of fiduciary duties owed to [participants],” the complaint says.

The plaintiff claims defendants’ breaches of fiduciary duty occurred when they knew or should have known that Exxon’s stock had become artificially inflated in value due to fraud and misrepresentation, thus making Exxon stock an imprudent investment under ERISA and damaging the plan and those plan participants who bought or held Exxon stock.

The complaint states that throughout the class period, Exxon repeatedly highlighted the strength of its business model and its transparency and reporting integrity, particularly with regard to its oil and gas reserves and the value of those reserves.

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