An amicus brief is a legal brief filed by a non‑party “friend of the court” who has a strong interest in the issues and wants to offer legal analysis, background, or policy arguments to help the judges decide the case. Federal rules explicitly allow such briefs in appeals.
The Department of Labor filed an amicus brief in Konya v. Lockheed Martin to explain how it believes ERISA should apply to pension risk transfers: it argues that (1) decisions to derisk by annuitizing are business (settlor) choices, not fiduciary acts; (2) fiduciaries should be judged on whether they followed a prudent, loyal process; and (3) the Konya plaintiffs have no constitutional standing because they are receiving all benefits owed and there is no sign of imminent default. The Department says it is trying to stop “regulation by litigation” and preserve employers’ ability to offer and responsibly derisk pension plans.
A pension risk transfer (PRT) is a transaction where a company sponsoring a defined benefit pension plan transfers some or all of its obligation to pay future pensions to another party, usually an insurance company. The goal is to reduce the employer’s financial and investment risk from the plan.
In a typical PRT annuitization for a defined benefit plan:
This is the kind of transaction at issue in Konya v. Lockheed Martin.
ERISA (the Employee Retirement Income Security Act of 1974) is the main U.S. federal law that sets minimum standards for private‑sector retirement and health plans. It does not require employers to offer a plan, but if they do, ERISA governs how the plan is run and protected.
For plan fiduciaries (people or entities that exercise discretionary control over the plan or its assets), ERISA imposes core duties:
Fiduciaries who breach these duties can be personally liable to make the plan whole.
Under ERISA, a “settlor function” is a business or plan‑design decision made by the employer in its role as plan sponsor, not in its role as a fiduciary. Examples include deciding whether to:
Because these are business decisions about what the plan will look like, they are not governed by ERISA’s fiduciary standards.
By contrast, fiduciary responsibilities apply when someone exercises discretionary control over plan management or assets, or over plan administration. In the PRT context, DOL’s brief says the decision to enter into a PRT at all is a settlor function, but choosing which annuity provider to use and how to run the selection process are fiduciary acts that must satisfy prudence and loyalty.
Article III standing is the constitutional rule that to sue in federal court, a plaintiff must show:
In pension cases, the Supreme Court’s decision in Thole v. U.S. Bank held that defined‑benefit participants generally lack standing if they are receiving all promised benefits and their pensions are not at substantial risk.
In its Konya amicus brief, the Department of Labor argues the plaintiffs lack Article III standing because:
So, in DOL’s view, the plaintiffs’ alleged increased risk is too speculative to be a concrete, imminent injury, and the case should be dismissed for lack of standing.
The plaintiffs in Konya v. Lockheed Martin are four retired Lockheed Martin employees (including Bruce Konya) who received monthly benefits from Lockheed’s defined benefit pension plans and whose benefits were transferred to Athene Annuity & Life via pension risk transfer transactions starting in 2021.
Their core claims are that:
Lockheed denies these allegations and argues that participants have been paid in full and that Athene is a suitable, well‑regulated insurer.
Litigation over PRTs can affect employers and participants in several ways:
Employers’ willingness to derisk: If courts allow broad ERISA lawsuits whenever a PRT is done, employers face higher legal risk and cost. The DOL warns this kind of “regulation by litigation” could discourage companies from offering or maintaining defined benefit plans or from using PRTs at all, even when they are financially sound.
Cost and availability of PRTs: Insurers and plan sponsors may demand more legal protections, due‑diligence steps, and pricing cushions to cover litigation risk. That can make PRTs more expensive and harder to execute, especially for smaller plans.
Participant outcomes: When done well, PRTs can move benefits to large, specialized insurers that are closely regulated and often better positioned to manage longevity and investment risk. But if sponsors avoid PRTs out of fear of lawsuits, some plans may remain with weaker sponsors or end up in distress, which can ultimately threaten benefits. Conversely, if PRTs are pushed through without adequate safeguards, retirees could be exposed to more default risk than ERISA and PBGC would otherwise allow.
If courts adopt the Department of Labor’s position in Konya, several practical effects are likely:
Clearer line between business and fiduciary decisions: Courts would treat the decision to derisk via a PRT (to annuitize at all) as a non‑fiduciary settlor decision. Litigation would focus instead on whether the sponsor followed a prudent, loyal process in selecting and monitoring the annuity provider, not on second‑guessing the business choice to derisk.
Higher but more predictable process standards: Plan sponsors would still need robust procedures—documented vetting of insurers’ financial strength, diversification, and protections for participants—aligned with DOL’s Interpretive Bulletin 95‑1 and later guidance. But they would have more confidence that good‑faith, well‑documented processes will receive deference in court.
Stabilized annuity/PRT markets: Insurers and sponsors would face less open‑ended liability for speculative claims about future risk, which could support continued growth of the group annuity and PRT markets. At the same time, DOL’s emphasis on prudence and loyalty may push sponsors and insurers to standardize risk assessments and disclosures in PRT deals.