Hagens Berman Appointed Co-Lead Counsel in Washington Mutual ERISA Case
SEATTLE – Today the U.S. District Court in Seattle appointed Hagens Berman Sobol Shapiro co-lead counsel in the case against Washington Mutual (NYSE: WM), claiming the company and its fiduciaries failed to adequately manage employees' company stock investments through the 401(k) plan, causing a total loss in excess of $150 million.
Judge Marsha Pechman ruled Hagens Berman and Keller Rohrback display the greatest efforts in investigating claims, and have the experience, knowledge and best resources to adequately serve the class.
As of December 31, 2006 the plan held $341,404,922 - at the time of the case filing on November 29, 2007 that had plummeted by 60 percent. Under ERISA law fiduciaries are obligated to eliminate imprudent investment vehicles from 401(k) plans and warn plan participants of risky investments. The lawsuit alleges that Washington Mutual's fiduciaries and insider-appointed benefits committee failed to do so.
According to the complaint, Washington Mutual's involvement in the subprime mortgage industry contributed to the decrease in stock value and employee savings plans. The company held billions of dollars in subprime loans that it had originated, many of which had gone into foreclosure in the last year.
The complaint goes on to explain that Washington Mutual's risk was exacerbated by the fact that the company engaged in a fraudulent appraisal scheme under which it artificially inflated the appraised values of homes. This means the loans in the company's portfolio were inherently overvalued but when Washington Mutual securitized those loans and sold them to investors they were perpetuating a massive fraud that created another risk - they would have to re-assume ownership of those loans if the scheme was revealed.
Washington Mutual employees who are interested in joining this class-action lawsuit can receive more information by calling 206-623-7292, or going to the Washington Mutual ERISA case page.
About Hagens Berman
Hagens Berman Sobol Shapiro is based in Seattle with offices in Chicago, Cambridge, Los Angeles, Phoenix and San Francisco. Since 1993, it has developed a nationally recognized practice in class-action and complex litigation. Among recent successes, HBSS has negotiated a $300 million settlement in the DRAM memory antitrust litigation; a $340 million recovery on behalf of Enron employees; a $150 million settlement involving charges of illegally inflated charges for the drug Lupron, and served as co-counsel on the Visa/Mastercard litigation which resulted in a $3 billion settlement, the largest anti-trust settlement to date. HBSS served as counsel in a $850 million Washington Public Power Supply settlement and represented Washington and 12 other states against the tobacco industry that resulted in the largest settlement in history. For a complete listing of HBSS cases, visit www.hbsslaw.com.
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