RadioShack Defeats Challenge to Stock Losses in 401(k) Plan

RadioShack Corp. executives defeated a lawsuit accusing them of violating federal benefits law by allowing workers to invest in company stock despite knowing of the company’s financial decline and impending bankruptcy.

The workers’ allegations—that the executives were imprudent by failing to respond to public information on RadioShack’s financial decline and insider information suggesting the stock was overvalued—aren’t sufficient to state a claim under the Employee Retirement Income Security Act, the U.S. Court of Appeals for the Fifth Circuit held Feb. 6.

The ruling is the latest defeat for workers who seek to hold their employers liable for offering allegedly inflated ...