'Plausible' Denials -- New Twists and Turns in ERISA Litigation
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Court and Legal 'Plausible' Denials -- New Twists and Turns in ERISA Litigation In this podcast episode, Nevin Adams and Fred Reish take a look at the new litigation landscape for ERISA plans, including an update on suits involving the BlackRock LifePath target-date funds, a surprising decision regarding rollovers and the fiduciary rule, and a flurry of ESG litigation. Source: Napa-net.org CA Federal Court Refuses to Dismiss ERISA Safe Harbor 401k Claims Against Calbiotech A California federal judge has denied Calbiotech's bid to dismiss a former employee's ERISA suit involving a claim that it failed to match contributions to employees' 401k plans. The judge also kept the former employee's retaliatory discharge claim alive but tossed his claims related to a separate employer-sponsored pension plan. Source: Hallbenefitslaw.com 401k Participant Drops Data Breach Suit Against Transamerica A retirement plan participant has dropped a lawsuit filed against Transamerica Retirement Solutions alleging that the retirement plan provider failed to exercise reasonable care in securing and safeguarding personally identifiable information, including names, addresses, Social Security numbers, and retirement fund contribution amounts. Source: Planadviser.com Judge Rejects Mitre's Efforts to Dismiss ERISA Lawsuit Fiduciary breach allegations against Mitre Corp. will advance, after a federal judge in Massachusetts ruled in favor of the plaintiffs and denied Mitre's motions to dismiss the lawsuit. U.S. District Judge Denise J. Casper ruled in favor of the plaintiffs, ordering the fiduciary breach, brought against Mitre for failing to leverage the bargaining power and size of assets in the plan to negotiate lower fees, to proceed. Source: Plansponsor.com Long-Standing 403b Excessive Fee Suit Settles The parties in one of the first university 403b excessive fee suits -- by participant-plaintiffs represented by the Schlichter law firm -- have unveiled the terms of a big settlement. The suit involved two plans sponsored by the University of Southern California. Source: Ntsa-net.org »» Click here for more Court and Other Legal Issues Insight: Studies, Research, and White Papers Defined Contribution Plan Participants' Activities, 2022 To measure participant-directed changes in DC plans, ICI has been tracking participant activity through recordkeeper surveys since 2008. This report updates results from ICI's survey of a cross section of recordkeeping firms representing a broad range of DC plans and covering more than 40 million employer-based DC retirement plan participant accounts as of December 2022. The broad scope of the recordkeeper survey provides valuable insights about recent withdrawal, contribution, asset allocation, and loan decisions of participants in these plans. Source: Ici.org American Views on Defined Contribution Plan Saving, 2022 This survey polled respondents about their views on defined contribution retirement account saving and their confidence in 401k and other DC plan accounts. Survey responses indicated that Americans value the discipline and investment opportunity that 401k plans represent and that individuals were largely opposed to changing the tax preferences or investment control in those accounts. A majority of respondents also affirmed a preference for control of their retirement accounts and opposed proposals to require a portion of retirement accounts to be converted into a fair contract promising them income for life from either the government or an insurance company. Source: Ici.org The Language of Longevity: How Understanding Prompts Action Financial literacy, financial wellness, and now longevity literacy. It's the latest phrase in the fight to raise awareness of -- and preparation for -- later-in-life issues, financial, medical, and otherwise, and an idea the TIAA Institute hit upon during its research. Source: Asppa.org Five Key Themes in J.P. Morgan Asset Management's 2023 Guide to Retirement New research released today explores top trends in the defined contribution space, including SECURE 2.0 and market uncertainty. J.P. Morgan Asset Management released its annual Guide to Retirement, examining five key retirement themes expected to impact financial advisors, defined contribution plan participants, and clients throughout 2023. Source: 401kspecialistmag.com Over Half of DC Investors Lack Longevity Literacy: Nuveen A new report by Nuveen highlights the latest retirement-focused insights in the defined contribution space, including longevity literacy, ESG, and new provisions offered in SECURE 2.0. Source: 401kspecialistmag.com Self-Directed 401ks Also Fell 20% in 2022, Schwab Report Shows Yet another report shows 401k accounts generally took a 20% hit in 2022, although it could have been worse if not for a subtle recovery in Q4. Source: 401kspecialistmag.com »» Click here for More Studies, Research, and White Papers Items of Special Interest to Service Providers District Court Vacates DOL Interpretation of Invest. Advice Does combining a recommendation to take a rollover from a retirement plan with post-rollover advice mean that advice is being provided on a "regular basis" under the DOL five-part test for fiduciary invest. advice status? In American Securities Ass'n v. United States Dep't of Labor, a United States District Court answered No. Recommendations to employee benefit plans must be analyzed separately from recommendations to IRAs to determine whether the regular basis prong of the five-part test has been met. Source: Groom.com 403b Plans SECURE 2.0: 403b Plan Expansion and Enhancement Over the years, 403b plans have been becoming more like their qualified plan cousin, the 401k plan. Despite this trend toward uniformity, legal, investment, and administrative differences have persisted. The SECURE 2.0 Act of 2022 includes several provisions that eliminate some of these remaining differences. Source: Mcdonaldhopkins.com Nerding Out on Secure 2.0: Long-Term Part-Time and 403b Plans SECURE 2.0 reduced this eligibility period to only 2 consecutive years of service, starting in 2025. SECURE 2.0 also included language to subject ERISA 403b plans to the LTPT fun, starting in 2025. Questions have arisen as to whether the LTPT rules will override a class exclusion in a 403b for employees working fewer than 20 hours and/or student employees. Some practitioners have opined that the LTPT requirements will not override the exclusion rules. Source: Ferenczylaw.com »» Click here for More 403b Material Compliance and Regulatory DOL Finalizes Significant Form 5500 Changes for 2023 Year The Final Rule addresses many of the outstanding reporting issues from the September 2021 proposal. These Form 5500 changes are effective for the 2023 reporting year. Most notably, this package of Form 5500 changes includes reporting rules related to defined contribution "groups of plans" or DCGs, changes to Schedules MB, SB, and R for defined benefit plans, the addition of IRS compliance questions, and a change to the counting method for determining whether a defined contribution plan is subject to audit. The changes are summarized here. Source: Groom.com Proposed Treasury Regulations on Forfeitures Would Require Changes to Tax-Qualified Retirement Plans The U.S. Treasury Department issued proposed regulations regarding the treatment of forfeited amounts in tax-qualified defined benefit and defined contribution retirement plans. The proposed regulations, if finalized, would require plans to be amended to specifically address new rules regarding the treatment of forfeited amounts. Source: Ballardspahr.com »» Click here for more Compliance and Regulatory Material Marketplace News Transamerica Partners With Cetera on Pooled Retirement Plan CAPTRUST Acquires $5.8B RIA Firm Creative Planning Acquires Telarray Advisors
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