The Indiana Electrical Workers Pension Trust Fund has been named as co-lead plaintiff in a lawsuit against the board of directors of retail giant Wal-Mart.
According to attorney Stuart Grant, the Indiana pension fund has not joined the lawsuit but has filed a separate suit against the retailer asking for company books and records regarding the investigation of a bribery scandal.
Yet, Delaware Chancery Court Judge Leo Strine made the Indiana union co-lead plaintiff because, in his opinion, the Indiana fund is taking the proper strategy in conducting its own review of company documents rather than relying on media reports.
The other co-lead plaintiffs are the California State Teachers Retirement System and the New York City Employees’ Retirement System.
The lawsuits stem from allegations, reported by The New York Times, that Wal-Mart employees bribed Mexican officials to get building permits which helped the company’s growth in the country.
Grant explained the pension funds are not suing Wal-Mart. The funds want to ensure that any fines or criminal liability be born solely by the directors and not by the company because the board of directors appears to have squashed an investigation into the bribery scandal.
“We’re not trying to hurt Wal-Mart,” Grant said.
The IBEW (International Brotherhood of Electrical Workers) has a good relationship with Wal-Mart, he continued, noting the union members shop at the store, are stockholders and want the company to prosper which will, in turn, benefit them.
The federal government is also investigating the bribery incident to see if Wal-Mart violated the U.S. Foreign Corrupt Practices Act of 1977.
In addition, the Indiana fund is suing to force Wal-Mart to turn over internal company reports regarding the investigation into the allegations. According to the Indianapolis Star, the attorneys for the electrical workers received 3,474 documents from the retailer but nearly half were redacted. In a twist, an anonymous informant mailed the plaintiff a slew of papers that the Indiana pension fund lawyers say supports the allegations in the Times’ story.
Whether the Indiana pension fund will join the suit against the board depends on what the internal company documents reveal, Grant said. However, he did indicate there is a strong possibility the IBEW will become a party to the lawsuit.
“Based on what I’ve seen, it’s ugly for these directors,” he said.