IBM Sued Over Pension Plan De-Risking Move Affecting Thousands

IBM mismanaged the retirement benefits of more than 130,000 former employees by removing them from the company’s pension plan in favor of risky annuity contracts, according to a proposed class complaint.

The lawsuit centers on a series of transactions in which International Business Machines Corp. swapped about $22 billion of its pension obligations for annuities administered by Prudential Insurance Co. of America. These transactions caused retirees to lose federal legal protections—including insurance coverage from the federal Pension Benefit Guaranty Corporation—and jeopardized their ability to receive their expected retirement benefits, according to a complaint filed Sept. 5 in the US ...