Aerotech Defends Stock Plan Cash Holdings as Wise in New Lawsuit

Motion systems equipment manufacturer Aerotech Inc. defended its practice of keeping cash-like investments in its workers’ employee stock ownership plan.

Aerotech derided a legal challenge to this practice as an attempt to “manufacture a new type of claim.” It has successfully maintained its ESOP for nearly 50 years in part because it keeps sufficient funds available to repurchase workers’ shares when necessary, the company said.

A new lawsuit saying the plan holds too much cash challenges “the very system that has sustained the ESOP for decades,” the company said Monday in a motion to dismiss.

The proposed class action ...