Athene Annuity Lawsuit: Standing, Lockheed Appeal, and DOL

The Athene annuity lawsuits are a wave of ERISA class actions filed since March 2024 by retirees against major U.S. employers, including AT&T, Lockheed Martin, General Electric, and Bristol-Myers Squibb, that transferred their pension obligations to Athene Annuity and Life Company, an insurer affiliated with Apollo Global Management. The retirees say their former employers breached fiduciary duties by choosing Athene over safer annuity providers. Employers and Athene say every retiree is being paid in full and the insurer is financially sound. Federal courts have split sharply on whether retirees even have standing to sue, and the Fourth Circuit is now poised to answer that question in the Lockheed Martin case.

Why Retirees Are Suing

Each lawsuit follows the same fact pattern. The employer sponsored a traditional defined benefit pension plan, then paid an insurance company to take over the obligation to send retirees their monthly checks. This is called a pension risk transfer, or PRT. Once the transfer closes, the pension liability is off the employer’s books and the retiree is an annuity holder rather than a plan participant.1Thompson Hine. AT&T and Lockheed Martin Face Class Actions Over Pension Risk Transfers to Athene

The complaints argue employers violated ERISA’s requirement to select the “safest annuity available.” Plaintiffs point to Athene’s ties to Apollo, its use of offshore reinsurance in Bermuda, a high concentration of assets like collateralized loan obligations, and what they call one of the thinnest capital surplus ratios in the industry. The Bristol-Myers Squibb complaint alleged Athene ranked 689th out of 695 carriers in surplus-to-risk ratio.2October Three. New York Federal District Court Denies Defendants Motion to Dismiss3PSCA. New Litigation Targets Athene Pension Risk Transfer

The suits also argue the transfer stripped retirees of the federal safety net provided by the Pension Benefit Guaranty Corporation. Annuity holders instead rely on state insurance guaranty associations, which typically cap coverage at $250,000 in present value of annuity benefits per person, though some states set higher limits. Plaintiffs argue these state-level protections are not pre-funded and are inferior to the PBGC guarantee.4NOLHGA. PRT Report3PSCA. New Litigation Targets Athene Pension Risk Transfer

Which Employers Have Been Sued

At least nine employers have been sued. Nearly all cases are brought by the St. Louis firm Schlichter Bogard LLP, and most also name State Street Global Advisors Trust Company, the independent fiduciary hired to select the annuity provider. The known defendants and transfers:

At least two additional employers have been sued. Only one of those unnamed cases reportedly involves an insurer other than Athene, Prudential.8Encore Fiduciary. Split Court Rulings Invite Pension Risk Transfer Claims

The Fight Over Standing

Every retiree in these cases continues to receive full pension payments from Athene. No check has been missed. That makes standing the central question the courts are wrestling with. Under the Supreme Court’s 2020 decision in Thole v. U.S. Bank, a plaintiff generally needs to show a concrete and particularized injury to sue in federal court. Employers argue there is no injury while retirees are still being paid. Retirees argue that being moved from a federally protected pension plan to an annuity backed by a riskier insurer is itself an injury.

Rulings for Employers

In Camire v. Alcoa USA Corp., Judge Loren L. AliKhan of the D.C. district court dismissed the case on March 28, 2025, ruling that plaintiffs failed to show an “actual or imminent” harm. The judge found that allegations of Athene being a risky provider “aren’t enough” to establish standing when every retiree continues to be paid in full.9Bloomberg Tax. Alcoa Scores Dismissal of Athene Pension Risk Transfer Lawsuit

In Bueno v. General Electric Co., Judge Glenn T. Suddaby of the Northern District of New York dismissed the case on September 24, 2025, finding concerns about a potential future default by Athene were “speculative” and holding that the transfer of pension obligations is a permitted settlor function under ERISA, not a fiduciary act.5NAPA Net. GE Dodges Schlichter Pension Risk Transfer Challenge

In Schoen v. ATI, Inc., a magistrate judge in the Western District of Pennsylvania recommended dismissal on October 7, 2025, concluding that because retirees receive the same dollar amount from Athene as before, there is no injury. The judge rejected the argument that the annuity had a “diminished value” from the loss of ERISA protections, noting the absence of a market for pension benefits to quantify such a loss.10October Three. Risk Transfer Litigation More Conflicting Court Decisions

The AT&T case (Piercy v. AT&T) followed a different path. The court found the plaintiffs had standing, concluding they received an “inferior financial benefit,” but dismissed the case on October 3, 2025, because plaintiffs failed to state a viable ERISA claim. The court held they could not show a “prudent fiduciary would have acted differently.”11NAPA Net. AT&T Prevails in Pension Risk Transfer Suit

The Weyerhaeuser court also found standing, agreeing that the selection of Athene could result in a “less safe, less valuable annuity,” but dismissed on the merits because most of the allegations about Athene’s condition described events that occurred after the 2019 transaction and could not demonstrate a breach at the time the provider was chosen. Plaintiffs were given leave to file an amended complaint.12Plan Adviser. Weyerhaeuser PRT Complaint Dismissed but Plaintiffs Could Refile

Rulings for Retirees

On the same day as the Alcoa dismissal, Judge Brendan A. Hurson in the District of Maryland denied Lockheed Martin’s motion to dismiss in Konya v. Lockheed Martin. The judge found the allegations, while “barely” sufficient, were enough to show the transfer to Athene created a serious risk to the plaintiffs’ pensions, noting that the pleading standard “is not Mount Everest.”13Gibson Dunn. Dueling Court Rulings Offer Insight Into ERISA Lawsuits Targeting Pension Risk Transfers14PSCA. DOL Amicus Supports Lockheed in PRT Case

In Doherty v. Bristol-Myers Squibb, the Southern District of New York denied motions to dismiss on September 29, 2025, ruling that the transfer from an ERISA-protected plan to an Athene annuity constituted a “diminution in value” sufficient for standing. The court also allowed claims of breach of the duty of prudence and the duty of loyalty to proceed, finding it plausible that Bristol-Myers Squibb was motivated by the $800 million in surplus plan assets it retained from the transaction.2October Three. New York Federal District Court Denies Defendants Motion to Dismiss

The Lockheed Appeal and the Labor Department’s Intervention

The case likely to decide the future of this litigation is Konya v. Lockheed Martin, now before the U.S. Court of Appeals for the Fourth Circuit (No. 25-2061). In July 2025, Judge Hurson authorized an immediate interlocutory appeal, recognizing a “clear disagreement” among district courts on standing.15Bloomberg Tax. Lockheed Martin Scores Quick Appeal Over Athene Pension Transfer The Fourth Circuit granted review in September 2025, briefing was completed by February 2026, and no ruling has been issued yet.16CourtListener. Bruce Konya v. Lockheed Martin Corporation

The U.S. Department of Labor filed an amicus brief on January 9, 2026, siding with Lockheed Martin and arguing for dismissal. The DOL took the position that plaintiffs lack standing because their injury is not “certainly impending,” pointing out that Athene holds A+ ratings from S&P and Fitch and an A1 rating from Moody’s. The DOL also argued its Interpretive Bulletin 95-1, which governs how fiduciaries select annuity providers, prescribes a “prudent process” rather than an “ends-based” test requiring selection of a single objectively safest provider. The brief warned that allowing these suits to proceed would “wreak havoc” on the pension system by discouraging employers from offering defined benefit plans, noting that no annuity selected in a PRT has defaulted in the last three decades while participants in employer-run plans have lost at least $8.5 billion during that same period.17U.S. Department of Labor. Amicus Brief, Konya v. Lockheed Martin Corp.

Former DOL officials Phyllis Borzi and Ali Khawar filed a brief on the other side, arguing that denying standing unless retirees can plead “something close to inevitable nonpayment” would gut ERISA’s fiduciary protections. AARP and the Pension Rights Center also filed briefs supporting the retirees. Industry groups including the U.S. Chamber of Commerce and the American Council of Life Insurers backed Lockheed Martin.18Plan Adviser. Former DOL Officials, Industry Groups Back Lockheed PRT Plaintiffs16CourtListener. Bruce Konya v. Lockheed Martin Corporation

Athene’s Response

Athene and Apollo have rejected the characterization of Athene as a risky provider. Apollo has said describing Athene as “private equity owned” is “factually inaccurate,” noting that Athene is part of a public holding company structure and is not backed by a private equity fund.19Apollo Global Management. Private Equity Owned Fake News Athene carries financial strength ratings of A+ from AM Best, S&P, and Fitch, and A1 from Moody’s, all with stable outlooks as of mid-2025, and reported $3.2 billion in excess equity capital as of December 31, 2025.20Athene. Our Business In the ATI case, Athene called the complaint “frivolous.”6Pittsburgh Post-Gazette. ATI Lawsuit Employer Pension Benefits

Athene has one notable regulatory penalty. In 2020, the New York State Department of Financial Services imposed a $45 million civil monetary penalty on Athene Holding and a subsidiary for conducting and soliciting pension risk transfer business in New York without a license, including 14 large-scale PRT transactions and thousands of unauthorized communications with New York-based plan sponsors. Athene agreed to route its New York PRT business through its properly licensed New York subsidiary.21New York State Department of Financial Services. Press Release Plaintiffs in the Bristol-Myers Squibb case cited that penalty as a red flag that should have raised concerns during selection.2October Three. New York Federal District Court Denies Defendants Motion to Dismiss

Where Things Stand

As of mid-2026, the scorecard tilts toward employers. Courts have dismissed the Alcoa, GE, AT&T, ATI, and Weyerhaeuser cases, some on standing grounds and some on the merits, with the Weyerhaeuser plaintiffs still able to refile. The Bristol-Myers Squibb case in New York remains active after surviving motions to dismiss. No case has reached discovery or class certification, and no court has yet ruled on the underlying merits of whether selecting Athene actually violated the “safest available annuity” standard.22Mercer. Pension Risk Transfer Cases Test Supreme Court’s Thole Decision

The Fourth Circuit’s decision in Lockheed Martin will likely be the most consequential development. If the court rules that retirees lack standing to challenge a PRT while they are still receiving full benefits, it could effectively foreclose this category of litigation. A ruling for the retirees would open the door to discovery and possible trials on whether employers and their independent fiduciaries followed a prudent process in choosing Athene.