Kim Jones Provides Overview of Recent Developments in 401(k) Lawsuits for Ignite

In two articles, benefits and executive compensation partner Kim Jones spoke to Ignites about recent 401(k) suits and their potential impacts.

In “Second 401(k) Suit Challenging BlackRock TDFs Gets Green Light,” the publication sheds light on Stanley Black & Decker recent allegations that it charged excessive bookkeeping fees and illegally included an underperforming fund from BlackRock’s target-date series in its retirement plan offerings. This case is one of two that moved forward following dismissals from the courts that shut down 10 other similar cases against Black & Decker. Jones said she doesn’t believe that the decision to move forward in this case will encourage more lawsuits from this issue.

In the other article, “Contradictory Rulings in 401(k) Forfeiture Suits Invite Legal Challenges,” Ignites highlighted a recent ruling against Qualcomm for claims of fiduciary violations regarding a plan sponsor’s use of forfeited funds among nine similar lawsuits brought to California district courts. The publication noted that the ruling against Qualcomm could signal potential settlement opportunities looking to pursue similar lawsuits, though Jones said she and the defense bar “remains optimistic” based on the reasoning behind the ruling, which pointed to the Treasury Department’s established practices for forfeiture usage.

“The Department of Labor has also not expressed a view, so the future prognosis is still uncertain at this point,” Jones noted. “In the meantime, plan sponsors may want to consider reviewing their plan documents to evaluate whether their current practices regarding use of forfeited funds comply with the law and the plan.”   

The articles are available to Ignites subscribers.