Pennsylvania judge dismisses class action over retirement committee's investment fees and costs
October 31, 2023
A Pennsylvania judge dismissed a class action brought by pharmaceutical company employees against their employer’s retirement committee over investment fees and recordkeeping costs they alleged were excessively high.
Launched in 2020, the class action originally accused the company, its board of directors and the retirement committee of breaching their fiduciary duties to plan members by failing to investigate or select lower-cost investments and monitor or control recordkeeping expenses.
By the time the matter reached a hearing, only the claim against the retirement committee had survived a series of pre-trial motions and dismissals. However, the judge hearing the case dismissed all remaining claims.
According to the August 18, 2023 ruling, the committee’s selection process for its investments and recordkeeping services, each involving the retention of third-party advisors, was reasonably prudent. In addition, the judge found that the actual investment options and recordkeeping costs selected by the committee were “objectively prudent,” based in part on the strong performance of its pricier target date funds and benchmarking studies indicating that the plan paid lower than average recordkeeping fees for much of the subject period.
To read the full document of the court, click on more information below:
