O'Reilly Automotive sued over 401(k) forfeitures

Last edited 3:41 p.m., Jan. 19, 2026 [Editor's note: A statement from the company has been added.]

Springfield-based auto parts retailer O'Reilly Automotive Inc. (Nasdaq: ORLY) has been sued in federal court by a former employee who alleges misuse of 401(k) forfeitures.

Plaintiff Tracie Patton, who was a participant in the company's 401(k) plan during her tenure with the company, is seeking class-action status in the lawsuit that alleges O'Reilly Automotive has violated the Employee Retirement Income Security Act by using forfeitures from departing employees to offset the company’s required matching contributions rather than covering plan expenses for participants. There are six counts listed in the lawsuit, which was filed Jan. 15 in the U.S. District Court for the Western District of Missouri’s Southern Division in Springfield.

In the lawsuit, O'Reilly Automotive is accused of allegedly applying more than $24.1 million in plan forfeitures from 2019-24 to offset its required matching contribution obligations and using $46,000 to defray plan expenses. According to the lawsuit, plan participants paid roughly $14.3 million in plan expenses during that time.

"Instead of prudently and loyally evaluating how to allocate plan expenses and best deploy plan assets that had been forfeited by departing plan participants, defendants instead reflexively and exclusively used those forfeitures to benefit [the] company, to the detriment of the plan and its participants," the lawsuit reads.

In the third quarter, O'Reilly Automotive reported net income of $725.9 million, a 9.1% increase from $665.5 million a year earlier. Third-quarter revenue was $4.7 billion, a 7.8% jump, according to past reporting. 

ORLY shares closed Jan. 16 at $94.70, which compares with a 52-week range of $82.04 to $108.72 per share.