Seattle, WAA class action lawsuit has been filed against Dell Inc., on behalf of participants and beneficiaries of the company's 401(k) plan for violating the Employee Retirement Income Security Act (ERISA).
The suit, filed September 29 in Seattle, claims that Dell and various defendants breached their fiduciary duties to 401(k) participants. According to the suit, Dell:
Failed to prudently manage the Plan's assets,
Failed to provide participants with accurate information regarding problems with Dell's financial condition, and
Failed to appoint and monitor the performance of other fiduciaries.
The price of Dell stock and the value of the stock owned through Dell's 401(k) retirement plans have fallen sharply in recent years. The Securities and Exchange Commission (SEC) and the U.S. Attorney's Office for the Southern District of New York are investigating Dell following allegations that the company inflated financial results through improper accounting.
In August of 2006, Dell announced five straight quarters of disappointing results.
In September of 2006, Dell announced that the U.S. Attorney's office had subpoenaed Dell for documents regarding accounting and financial reporting from 2002 through 2006. Dell reported that two separate investigations, by the SEC and by Dell, indicated possible misstatements in financial reports that may have affected financial results.
That same month, Dell was threatened for Nasdaq delisting due to its failure to file Form 10-Q for the quarter that ended August 4. The company stated that the inability to file the form was connected to the investigation by the SEC into its accounting and financial reporting.
Misstatements by Dell may have exaggerated the company's financial position. People who are members of Dell's 401(k) plan and lost money because of Dell's failure to manage the 401(k) may be eligible to join the class action suit against Dell.