USA, by State
· North Carolina
· Reynolds American
|Jump to full article: Business Journal of the Greater Triad Area, 2002-05-20|
Author: late June 2000, the Nabisco stocks had r
An employee of R.J. Reynolds Tobacco Co. argues in a federal lawsuit that he and as many as 3,000 other 401(k) plan participants lost money when the company "froze" certain stocks during the 1999 spinoff from Nabisco.
Forsyth County resident Richard Tatum alleges in a proposed class-action suit filed May 13 that Reynolds violated the Employment Retirement Income Security Act because it failed to act in the interest of investment plan participants.
The lawsuit, filed in U.S. Middle District Court in Greensboro, says that between June 14, 1999, and Jan. 31, 2000, fiduciaries of the Reynolds investment plan didn't allow participants to direct more funds into Nabisco stocks that were part of the plan. (They could, however, sell the Nabisco stocks, Tatum's attorney said.)
On Jan. 31, 2000, the plan sold off all its remaining Nabisco stocks, as it announced it would do just before the June 15 spinoff.
Nabisco stocks steadily fell during the fall of 1999 and early 2001. Tatum alleges that it would have been more prudent had he and other plan participants been allowed to buy more Nabisco stocks while waiting for recovery, and also not to sell the stocks when they reached low points, as they did in January 2000.
Jump to full article »