"Government Backs Top Court Review of 401(k) Plan Fee Case"

"...the Solicitor General's brief states that the Tibble v. Edison case warrants the Supreme Court's review on the class action claim from plaintiff Glenn Tibble that the Edison company was not acting in the sole interest of plan participants when it selected higher-cost investment options from its retirement plan services provider when lower-cost options were available.

...during the initial bench trial, a district court held that Edison had breached its duty of prudence by offering retail-class mutual funds as plan investments when identical lower-cost institutional funds were available.

...The original complaint addressed in the Solicitor General’s Tibble brief alleged that Edison International had placed 401(k) plan participants in high-cost retail mutual funds when cheaper, institutional funds were available. In turn, according to the compliant, the California-based utility company received a reduction on their recordkeeping fees and other plan administration costs.

...Schlichter says the Solicitor’s brief supports the plan participants' interest in the matter, who argued that Edison and other plan fiduciaries had an ongoing duty to review plan investments and remove imprudent ones...

...“The impact of this important issue cannot be overstated, given that over $4.2 trillion of retirement assets are invested in employer-sponsored 401(k) plans in the United States,” Schlichter adds.

Schlichter’s firm has brought a long list of controversial cases involving claims of excessive fees against other companies, including Krueger v. Ameriprise Financial; Gordan v. Mass Mutual; Abbott v. Lockheed Martin; Grabek v. Northrop Grumman; and Spano v. Boeing."


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