Lawsuit Targets SBC Communications
LOS ANGELES (AP) _ A $1.5 billion lawsuit filed by 18 current and former employees of SBC Communications accused the telecommunications giant of improperly selling stock in the workers’ 401(k) accounts for corporate gain.
The lawsuit, filed in federal district court, claims breach of trust over the sale of $600 million worth of employee holdings in AirTouch, an SBC competitor now known as Vodafone AirTouch.
Plaintiffs’ lawyers said they filed the suit on behalf on 40,000 401(k) plan participants who had been invested in AirTouch stock since early 1994, soon after the company’s stock first was made public.
The employees claim SBC had no good reason to sell the shares.
A statement from San Antonio-based SBC said officials hadn’t seen the lawsuit and could not comment on specifics.
``However, our position on this issue is very clear,″ the company said. ``No SBC savings plan includes direct stock ownership in any other company that is not related to SBC.″
The company also said it never profited from the stock conversion.
James M. Finberg of Lieff, Cabraser Heimann and Bernstein said the suit seeks class-action status, although that must still be granted by a judge.