Aon Corporation 401k Plan
Practice Area: Employee Benefits
Cohen Milstein Sellers & Toll PLLC filed a lawsuit in October 2004 on behalf of participants in the Aon Savings Plan (the “Plan”) for violations of the federal pension law (ERISA) in connection with loss of value in Aon Corp.’s stock acquired and held by present and former employees of Aon through the Savings Plan. The goal of this litigation is to restore losses in Aon Corp. stock to the accounts of employees in the Plan.
The lawsuit alleges that the fiduciaries of the Aon Savings Plan violated their fiduciary duties by investing Plan assets in Aon stock from October 31, 2002 to October 19, 2004, during which time Aon failed to disclose certain harmful business practices. In particular, Aon had a system of steering unsuspecting clients to insurers with whom it had lucrative payoff agreements, and soliciting rigged bids for insurance contracts. As a result, Aon’s stock may have traded at artificially inflated prices, as demonstrated by the decline in the stock price following the disclosure of these practices. The lawsuit asserts that the fiduciaries of the Plan breached their duty to act prudently by continuing to invest in the assets of the Plan in Aon stock when the stock of the corporation was grossly inflated as a result of the undisclosed business practices.
On May 3, 2005, the Court appointed the law firm Wolf Haldenstein Adler Freeman and Herz as Interim Lead Class Counsel and on August 22, 2005, a consolidated amended complaint was filed. Defendants moved to dismiss the consolidated amended complaint which motion was denied on April 12, 2006. A copy of the Opinion denying the Motion to Dismiss is attached.
Plaintiffs moved for Class Certification and on November 29, 2006, Judge Charles R. Norgle ruled that the action may proceed as a class action. The Court approved the following class definition:
- all persons who were participants in or beneficiaries of the Aon Corporation 401(k) Savings Plan from October 19, 1998 through October 19, 2004, inclusive (the “Class Period”), and whose accounts included investments in Aon Corporation common stock. Excluded from the Class are the Defendants named in this action, Aon's Board of Directors throughout the Class Period, members of their immediate families, and their legal representatives, heirs, successors, or assigns, and any entity in which any Defendants have or had a controlling interest.
See Attached Class Certification Order.
The parties are completing fact and expert discovery and it is anticipated that if the case is not settled it will be tried before the Judge Norgle in 2010.
Questions regarding the status of the case are directed to Adam J. Levitt of the law firm of Wolf Haldenstein Adler Freeman and Herz at (312) 984-0000.