I didn’t want July to pass without commenting on The Fid Guru’s excellent blog post reviewing excessive fee litigation over the first half of the year and the corresponding state of the fiduciary liability insurance market. I particularly appreciated the extensive discussion of the history of the market for fiduciary liability coverage, as it

I was being interviewed by a reporter the other day and casually noted that I keep my twitter open on my computer all day for no other reason than to follow Bloomberg BNA’s nearly instantaneous reporting of important new court decisions in the ERISA field. True to form, this morning I came into work to an article on, and a copy of the decision by, the Second Circuit yesterday in the long running pension class action case, Osberg v. Foot Locker, which concerns a claim for reformation of a pension plan to provide employees with the benefits they believed were promised in plan communications, rather than those actually provided under the plan’s express terms themselves. You can find the Bloomberg BNA article on it here, and the decision itself here.

Continue Reading Reflections on the Second Circuit’s Decision in Osberg v. Foot Locker

I have used this anecdote before, so you can jump ahead if you have either read something where I have written it before or heard a talk of mine where I have said it, but if you haven’t, I have always thought it is a good lead in to any discussion of the church plan litigation. A long time client of mine was hired by his employer as an in-house staff lawyer in 1975, and was told that there is a new law, ERISA, and he is in charge of it. He once told me that, in the early years of ERISA, they used to operate by gut, analogy, metaphor and instinct in deciding what some of the terms meant and how they should be applied, given that much of the statute and its structure was, one, novel and, two, had not yet been interpreted by the courts. In those early years, he often had to decide whether a particular plan should be viewed as a governmental plan – which, much like church plans, are exempt from ERISA – and the test they applied was this: if it looked like it was run by a governmental type entity, quacked like it was run by one, and waddled like it was run by one, than it was a governmental plan, as far as he and his team were concerned.

Continue Reading Notes (and a Prediction) on the Supreme Court Argument on Church Plans

Several years ago, when the first of the class actions were filed alleging that medical institutions were improperly claiming church plan status under ERISA, I was speaking on a panel at one of the American Conference Institute’s ERISA Litigation conferences, where I found myself eating lunch with two of the lead lawyers on those class action cases. I raised for them – and someone else would eventually ask the same question during their presentation on the church plan class actions – the question of damages. In particular, I wondered what they would ask for, and whether the defendants could afford it. I assumed that part of the relief would be to have the plans made compliant with the full panoply of ERISA’s procedural, notice, plan communication, claims processing, funding and other requirements. But that, I noted, was the easy part; it would only require the defendants to essentially hire really good ERISA lawyers and administrators and fix the plans. But what about the money? Could the defendants fund the massive shortfalls that the plaintiffs were claiming existed in the plans?

Continue Reading The Church Plan Cases at the Supreme Court: A Billion Here, A Billion There and Soon You Are Talking Real Money

2016 was the year that church plans went to the Supreme Court, excessive fee claims came to elite universities and the Department of Labor’s authority to alter its regulation of fiduciary conduct was challenged in multiple courts. Of course, stock drop litigation, excessive fee cases, and other assaults on the make up of 401(k) plans continued apace, even if they yielded the spotlight to flashier, more novel types of cases.

Continue Reading The Year in Review: Looking Back at ERISA Litigation In 2016

There is an old political saying that where you stand depends on where you sit, which, roughly translated, means that people tend to assert positions that are beneficial to their own organizations and employers, rather than based upon a consideration of broader issues. The author of the maxim, Rufus Miles, thinks the idea goes

Well now. The world’s leading private attorney general of ERISA fee enforcement has now instituted four coordinated lawsuits against the retirement plans of major universities (MIT, Yale, NYU and Duke, as of this writing). I haven’t read the complaints yet, and have only read the industry articles on it (I like this one, and