Participants in Aon Corp.'s pension plan have sued the company, alleging violations of the Employee Retirement Income Security Act, or Erisa, in connection with the recent loss in value of the giant insurance broker's stock.
The class action brought in U.S. District Court for northern Illinois alleges that Aon Savings Plan's fiduciaries violated Erisa by investing plan assets in Aon stock from Oct. 31, 2002, to the present. The stock's price may have been artificially inflated during that time by Aon's nondisclosure of a system of steering clients to insurers with whom it had lucrative compensation agreements and soliciting rigged bids for insurance contracts, the plaintiffs' attorneys said in a press release Tuesday.
Inflation in Aon's stock price was shown by its precipitous decline - 26% in the two weeks after disclosure of those practices, to $20.41 a share on Oct. 29 - according to Cohen, Milstein, Hausfeld & Toll PLLC, a Washington class-action law firm. Aon's stock was trading at $20.91 a share Tuesday afternoon, up 1% and well within its 52-week trading range.
