12:06 PM EST, 12/31/2024 (MT Newswires) -- Amazon.com ( AMZN ) is facing legal action over claims that it misused employee 401(k) forfeitures to offset its own contributions, breaching federal fiduciary duties under the Employee Retirement Income Security Act.

The complaint, filed in the US District Court for the Western District of Washington on Monday, accuses Amazon ( AMZN ) and its 401(k) plan administrative committee of allocating millions in employee forfeitures to reduce the company's outstanding contributions, rather than using the funds to cover plan expenses or redistributing them to plan participants.

The lawsuit, led by plaintiff Cory Curtis, alleges that Amazon ( AMZN ) used $68 million in forfeitures in 2021 to offset company contributions, leaving more than $16.6 million unallocated by year-end. In 2022, the company reportedly used $102 million in forfeitures to offset its contributions and failed to allocate over $34.5 million in forfeitures.

The suit seeks disgorgement of all profits generated by the alleged misconduct and demands that Amazon ( AMZN ) restore losses to the plan.

The class action aims to represent over 20,000 members of Amazon's ( AMZN ) 401(k) plan from Jan. 1, 2018, through the date of judgment.

Amazon ( AMZN ) did not immediately respond to MT Newswires' request for comment.

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