Former employer sues over blackout period

[Guest smmay]

My husband left his previous job on Dec 31, 2000. He was aware of an upcoming 401K blackout that was to begin on Jan 1, 2001. The company made it very clear that there was a firm date for filing changes in employee fund allocation. We made our fund selections and left it at that. Now, nearly 4 months later, the newly selected fund adminstrator (a VERY large & well repsected Wall Street firm) refuses to end the blackout. According to my husband's former employer, they are even suing the new administrator to release the funds. Like everyone else in the market, we have lost a lot of value in this account (we can only assume as we have never received a statement to indicate what was transferred!)

Do we have any other recourse? What constitutes negligence on the fiduciaries' part? Could they be suing just to cover their butts?