Pension Risk Transfer Litigation: No New Cases but New Developments in Existing Cases Show This Litigation Trend is Not Over

Twelve pension risk transfer (PRT) litigation cases were filed in 2024, a single case was filed in 2025, and none have been filed in 2026 thus far. Plaintiffs’ lawyers file suits in areas where they see opportunities to win, so the sharp decline in filed cases speaks loudly to their lack of confidence in these cases. However, one adverse circuit court decision could completely change the outlook, so, as is the case in virtually all ERISA litigation, we can’t view PRT litigation in the rearview mirror. This article reviews the current PRT litigation landscape and discusses two new court developments.

Because of the consolidation of suits against the same defendants, those thirteen cases resulted in ten total suits.

• Six dismissed. Six of the ten suits have been dismissed by the district court, but five of the six could still be revived – or have been revived already – either through an amended complaint or on appeal.
  
  • Four were dismissed based on a lack of standing: Camire v. Alcoa, Bueno v. General Electric, Schoen v. ATI, and Dow v. Lumen Technologies (discussed below).
  • One was dismissed based on both standing and substantive grounds, Dempsey v. Verizon Communications, which is the one that cannot be revived.
  • The last dismissal was based only on substantive grounds, Maneman v. Weyerhaeuser, so it is very possible that an amended complaint could lead the court to deny the motion to dismiss.
• Three denied motions to dismiss. Two suits – Konya v. Lockheed Martin and Doherty v. Bristol-Myers Squibb – survived the motion to dismiss, but both defendants have been granted the ability to appeal to the circuit court before the district court case moves forward and have filed appeals. In both cases, the Department of Labor and a group of states led by Iowa filed amicus briefs in support of the defendants’ appeals. Most recently, the Magistrate in Piercy v. AT&T (discussed below), where the case had previously been dismissed on substantive grounds, recommended that the motion to dismiss be denied because an amended complaint had cured the substantive deficiencies of the original complaint (so it is counted here, not among the six dismissals).
• One – no ruling. Spohn v. IBM.
  
  

So, eyes are on the two circuit court cases where the district court denied the motion to dismiss, with the Lockheed Martin case expected to be decided first. At the same time, the district court decisions obviously play a major part, with the other judges reviewing the landscape of decisions to look for persuasive reasoning. In that context, below is an update on recent developments.

Piercy v. AT&T

In March 2024, two class actions were filed in the same U.S. District Court (Massachusetts) against AT&T and State Street Global Advisors (“SSGA”) for selecting Athene as the insurer taking over the AT&T plan’s liabilities in a PRT. (SSGA was the independent fiduciary that was appointed by AT&T and that selected Athene.) The cases were consolidated and were referred to Magistrate Paul Levenson by District Court Judge Nathaniel Norton. The Magistrate recommended that the plaintiffs had standing to sue, but recommended that the complaint be dismissed based on the lack of specific allegations regarding the imprudence of selecting Athene. The district court later accepted the Magistrate’s recommendations.

The plaintiffs then amended their complaint in October 2025, which both AT&T and SSGA moved to dismiss again in November. On August 31, 2026, the Magistrate issued his report regarding the amended complaint. The report found that (1) the plaintiffs have standing (but he changed his analysis regarding why they have standing), (2) the amended complaint should survive a motion to dismiss because it sufficiently alleged a breach of fiduciary duty by SSGA in selecting Athene, and (3) the complaint against AT&T should be dismissed due to AT&T’s lack of participation in or knowledge of the alleged breach by SSGA. If the District Court judge again accepts the Magistrate’s recommendations, the case will survive the motion to dismiss, with plaintiffs having achieved standing despite every participant in the plan receiving their promised level of benefits.

Standing:

• Background. Briefly, in our view, and the view of all but one (Weyerhaeuser) of the courts that have ruled on PRT cases, the controlling Supreme Court case regarding standing is Thole v. U.S. Bank, which found no standing for defined benefit plan participants for a breach of fiduciary duty due to the fact that the breach had not caused them to lose any benefits. But the Supreme Court left open the possibility that plaintiffs might have standing “if the mismanagement of the plan was so egregious that it substantially increased the risk that the plan and the employer would fail and be unable to pay the participants’ future pension benefits.” (emphasis added)
• Magistrate’s initial report in August 2025. The Magistrate previously found that such a “substantially increased risk” is enough to trigger standing under Thole and that such an increase was sufficiently alleged, based on allegations that Athene was substantially riskier than other insurers.
• Magistrate’s subsequent report in August 2026. Unlike other courts in all but one (Weyerhaeuser) of the PRT cases and unlike his first report, the Magistrate found that “the standing analysis in Thole has little direct bearing on PRT cases.”

  • The Magistrate says Thole is off point:

    “The question of Article III standing in this case turns on a fundamental principle: that plaintiffs generally state a cognizable claim when they allege that their own monetary interests have been harmed. This principle was not at issue in Thole.”

    This statement is curious: we read Thole to address that exact issue and to say that the participants’ monetary interests were not harmed in a way that would give rise to standing.

  • The Magistrate further stated:

    “Because Thole involved the employer’s investment of the employer’s own money, the employees had no direct stake in whether the employer’s investments did well or poorly. Once the employer set money aside for retirement benefits, the employer’s investment of that money was subject to various legal requirements under ERISA. But this did not change the Article III analysis. Even if the employer’s investment decisions ran afoul of ERISA, the money being invested was still the employer’s money, and the employer still owed the employees precisely the same amounts.” (internal citations omitted)¹

    In other words, the Magistrate is saying that a promise from an employer is different from a promise from an insurer. It is not clear why that would be the case. In both cases, if there is less security backing up the promise, the promise is less valuable. (For example, if an employer mismanages plan assets so that a pension plan goes from 120% funded to 100% funded, there is less security backing up the pension promise, but that is clearly not a harm under Thole.) The Magistrate does not explain why a less valuable promise to pay from an insurer is a harm, but a less valuable promise to pay from an employer is not a harm.

Substantive grounds. The Magistrate found that the amended complaint cured the defects of the first complaint and alleges enough facts showing a fiduciary breach to survive a motion to dismiss.

• Here is what the Magistrate said.

  “Unlike the previous complaint, the present [amended] Complaint offers comparisons with other PRT annuity providers and alleges that Athene was riskier. The Complaint also addresses the other glaring flaw in the previous iteration, Plaintiffs’ failure to address the separate account. Defendants correctly point out that the Complaint fails to allege that Athene differs from its competitors with respect to its ‘commingling’ practices (such as including multiple PRTs and transferring surplus funds from the separate account to the general account). The Complaint does, however, allege that Athene’s problematic investment practices and reliance on affiliated party transactions carry over to the holdings in its separate account. There are undoubtedly a variety of factual disputes that may emerge, such as whether annuities were actually available from the comparator insurers that Plaintiffs identify. Likewise, there are disputes about whether the Complaint employs the correct benchmarks in making those comparisons. But these are not disputes that can be resolved upon a motion to dismiss.” (internal citations omitted)

• Take-away from the Magistrate’s analysis. The Magistrate is essentially saying that the plaintiffs can survive a motion to dismiss by comparing Athene to insurers that may be invalid comparators and may not even provide PRT annuities of the type at issue. This is very troubling.

Claims against AT&T. The Magistrate recommended that the complaint against AT&T should be dismissed due to AT&T’s lack of participation in or knowledge of the alleged breach. In light of the above two recommendations on standing and substance against SSGA, this is unlikely to help slow down PRT cases if the above analysis by the Magistrate is followed by other courts.

One other side point. The following point was not central to the Magistrate’s findings, but it is worth noting. The issue was whether a low price for an annuity is an indicator that the annuity is less safe. Here is the interesting excerpt:

Defendants . . . suggest that some degree of price consciousness may have been appropriate because “it was a partial PRT, meaning every additional dollar spent on the annuity reduced assets used to pay benefits to participants remaining in the Plan.” This latter point seems flatly wrong. In selecting an annuity provider, Defendants owed an exclusive fiduciary duty to the people who will depend on that annuity for the rest of their lives.

It is our understanding of ERISA that fiduciaries have a duty to all plan participants.

Dow v. Lumen Technologies

In 2024, Lumen Technologies (plan sponsor) and SSGA (independent fiduciary) were sued in the District of Colorado for selecting Athene for Lumen’s PRT transaction. On September 1, 2026, the court dismissed the case based on a lack of standing.

Unlike the Magistrate in the AT&T case, the court found that the standing analysis is governed by the Supreme Court’s decision in Thole v. U.S. Bank. Here is the core of the court’s reasoning, which is similar to other courts that found the plaintiffs in PRT cases lack standing:

Plaintiffs’ [amended complaint] clearly alleges that the transfer of their pension benefits to Athene substantially increased the risk that these benefits would be unpaid because of the risk that Athene will fail. . . . Even accepting these allegations as true, I am not persuaded that Plaintiffs have plausibly pled that default by Athene is “actual or imminent … likely to occur soon,” [citing a Supreme Court decision on standing], or “certainly impending,” [citing a different Supreme Court case on standing]. At best, these allegations show that Athene may be more likely to fail than other annuity providers. Failure by Athene may not result in the nonpayment of Plaintiffs’ pension benefits in any event because of protections still afforded them following the PRT including that provided by the [state guaranty associations]. . . . Accordingly, the alleged increased risk that Plaintiffs’ pension benefits may be unpaid in the future based on default by Athene fails to demonstrate a sufficient injury in fact to support Article III standing.

The court also held that, under Thole, any reduction in the value of the annuity by reason of the PRT is not a harm giving rise to standing, because the participants are owed the same benefits. This is the point overlooked by the Magistrate in the AT&T case. Also, the plaintiffs argued that harm to them is not needed to establish standing because the plaintiffs are seeking relief in addition to monetary damages (such as disgorgement of profits by the fiduciary). That argument is clearly inconsistent with Thole, so this court rejected it.

Concluding Perspective

The near halt in new PRT suits since 2024 led many to believe that this litigation trend had faded away. However, as discussed above, recent court developments proved that perspective to be premature. In Dow v. Lumen Technologies, the district court correctly applied Thole and dismissed the case for lack of standing, reinforcing what has become the majority position among courts ruling on PRT complaints. But, if the district court follows the Magistrate’s report and disregards Thole, then Piercy v. AT&T may provide the roadmap for plaintiffs to secure standing. If that happens, PRT litigation would follow the same pattern as the majority of recent fiduciary litigation against ERISA plans, with mixed rulings in different courts on the same circumstantial allegations.

In our view, and the view of most courts so far, PRT complaints fail on both standing and substantive grounds. Under Supreme Court precedent on standing, there has to be actual harm or certainly impending harm. The PRT cases do not meet that test, since every participant has received every dollar they were promised and there is no imminent threat that that will change. On substantive grounds, there needs to be a plausible case made that the process used to select the insurer was flawed. None of the complaints contain anything that relates to that process. The complaints simply string together criticisms of the insurer at issue, alleging that participants who have not lost any benefits may, at some future point in time, potentially lose some of their benefits. Such a hypothetical does not imply an imprudent fiduciary process.

Until there is more judicial clarity, which may soon come from circuit court rulings in Lockheed and Bristol-Myers Squibb, plan sponsors and fiduciary liability insurers are left spending millions of dollars defending claims brought by participants who have no actual damages to allege, yet somehow may have standing to allege them anyway.