Stember Feinstein Doyle & Payne, a Pittsburgh law firm, is investigating allegations that the Baltimore energy company committed a fiduciary breach in its handling of the company stock in its Constellation Energy Group, Inc. Employee Savings Plan 401(k).
A news release from the law firm said it is looking into whether actions by Constellation Energy Group violated the Employee Retirement Income Security Act (ERISA) by making inaccurate statements about its financial health and causing its share price to be artificially inflated.
Specifically, the firm is investigating whether Constellation committed the breach by continuing to offer Constellation Energy common stock as an investment option for participant contributions when it was imprudent to do so; failing to take action to sell Constellation Energy stock or otherwise protect the Plan’s assets; and accepting a deal with MidAmerican Energy Holdings Co. that allegedly does not provide full value for the shares held by plan participants.
“Stock drop’ lawsuits are one of several litigation varieties facing plan sponsors (see “It’s a Jungle Out There“).