Given the continuing wave of ERISA litigation, this article has become a mainstay of The Speed Reader. A sample of recent cases is provided below.
The most common type of ERISA case for approximately the past seventeen years involves retirement plan participants’ allegations that plan fiduciaries caused participants to pay excessive recordkeeping and investment fees and included one or more poorly-performing investment options in the plan. Recent cases in this category include the following:
Other types of recent ERISA cases are as follows:
ForUsAll, Inc. v. United States Department of Labor (decided on August 30, 2023 by the U.S. District Court for the District of Columbia): This case arose from the DOL’s 2022 guidance on plan sponsors that include cryptocurrency in their 401(k) plan’s investment lineup. In that guidance, the DOL stated that it “cautions plan fiduciaries to exercise extreme care before they consider adding a cryptocurrency option to a 401(k) plan’s investment menu for plan participants.”
The plaintiff in this case provides administrative and other services for retirement plans. The plaintiff claimed that the DOL guidance affected the plaintiff adversely, by prompting retirement plans to back out of discussions about partnering with the plaintiff to provide plan participants with access to cryptocurrency investment options. The plaintiff sought a court order declaring that the DOL guidance was unlawful, vacating and setting it aside, and an injunction preventing the DOL from applying it in any manner.
The court ruled that “None of [the plaintiff’s] requested relief, however, appears likely to redress ForUsAll’s alleged injury because ForUsAll fails to show that these actions would cause the third-party fiduciaries to renew their discussions or enter into the contemplated partnerships. Nor is the [DOL guidance] final agency action subject to judicial review. For these two reasons, the Court grants the Department’s motion to dismiss” the case.
Su v. Virtual Matrix Corporation (complaint filed on August 30, 2023 in the U.S. District Court for the District of Minnesota): The DOL filed this lawsuit after allegedly finding that the defendant plan sponsor and its CEO failed to remit $45,972 in employees’ contributions and $759 in participant loan repayments to the 401(k) plan at issue from April 1, 2021 to October 31, 2022. The DOL seeks a court order requiring the defendants to make the plan whole, permanently banning the defendants from serving as fiduciaries or service providers to any other ERISA-covered employee benefit plan, and removing them from the fiduciary positions they hold with the plan.
Parker v. Tenneco, Inc. (procedural ruling issued on August 21, 2023 by the U.S. District Court for the Eastern District of Michigan): The plaintiffs filed this breach of fiduciary duty case on behalf of their employee retirement plans, and as a class action on behalf of themselves and persons who were or are participants in the plans. At this stage of the litigation, the court addressed the defendants’ motion to compel the plaintiffs to submit the dispute to arbitration.
The plan amendments at issue included a “Mandatory and Binding Arbitration Procedure,” which purported to preclude a claimant from bringing a covered claim in a representative capacity (the “Class Action Waiver”).
The court began its analysis by noting that “an arbitration agreement is not enforceable if it has the effect of altering, limiting, or precluding a party from pursuing her substantive rights or remedies under a federal statute.” Next the court noted that ERISA provides plan participants with the right to bring fiduciary breach lawsuits in a representative capacity on behalf of the plan as a whole. The court then ruled as follows: