Courts Favor Employers On Prudence In ESOP Suits

Law360, New York (June 14, 2010, 1:57 PM EDT) -- A 20-year study of litigation involving employee stock ownership and 401(k) plans has found that courts generally side with employers when it comes to granting a presumption of prudence in holding company stock.

But courts have generally sided with plaintiffs when it comes to granting former participants standing, according to the June report from the National Center for Employee Ownership, a private nonprofit research group based in Oakland, Calif.

The report analyzed 141 cases involving private company ESOPs and 34 involving public company plans from 1990...
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