Plaintiffs prevailed in this week’s two notable decisions, but not entirely. In the first decision, the Sixth Circuit allowed a portion of a pension case alleging excessive investment fees to proceed. In the second case, the Fourth Circuit addressed welfare plan vesting and found, under the highly unusual circumstances of the case, some retirees could proceed with their claim for life insurance benefits.
Continue Reading Sorry ABBA, No Winner Takes It All In These Two Cases of the Week
Lowe’s 401(k) Participants Lose at Trial After Winning Every Battle
Reetz v. Lowe’s Companies, Inc., No. 5:18-CV-00075-KDB-DCK, 2021 WL 4771535 (W.D.N.C. Oct. 12, 2021) (Judge Kenneth D. Bell).
This week’s notable decision is a surprising loss for participants in Lowe’s 401(k) pension plan against the plan’s investment manager, Aon Hewitt Investment Consulting, following class certification, success on summary judgment, and a multi-million-dollar, court-approved settlement with Lowe’s inside fiduciaries.
Plaintiff Benjamin Reetz, a former Lowe’s employee and 401(k) plan participant, brought suit against Lowe’s, the administrative committee of the plan, and Aon, claiming numerous breaches of fiduciary duty with respect to Aon’s design and implementation of a new investment strategy and line-up for the plan. Following class certification, plaintiff’s claims against Lowe’s and the administrative committee were resolved through a class action settlement totaling $12.5 million. But the claims against Aon proceeded to a bench trial.
Continue Reading Lowe’s 401(k) Participants Lose at Trial After Winning Every Battle
Pension Plan Participants Largely Prevail in a Kitchen Sink Appeal to the Second Circuit
Browe v. CTC Corp., Nos. 19-677-CV, 19-813-CV, __ F.4th __, 2021 WL 4449878 (2d Cir. Sept. 29, 2021) (Before Circuit Judges Livingston, Lynch, and Bianco).
If you ever need to show someone a case to demonstrate how messy ERISA can be, you may want to consider this one. In this decision, the Second Circuit tackled a full buffet of ERISA issues, including statutes of limitations, “top hat” plan status, liability among fiduciaries, statutory penalties, and how to calculate and apportion remedies.
The trouble began when CTC Corporation, a Vermont photo-finishing company, decided to offer its employees a deferred compensation benefit plan in 1990. When the rise of digital photography obsoleted traditional film development, the company crumbled and so did the plan. CTC began using plan assets to fund the business in 2004, and eventually it was forced to cease doing business in 2014. This lawsuit, brought by several CTC employees against CTC and its managers, followed. The district court largely ruled for plaintiffs, but neither side was happy, and both appealed.
Continue Reading Pension Plan Participants Largely Prevail in a Kitchen Sink Appeal to the Second Circuit