DOL Sues Insurance Brokerage Firm – Selection of an Annuity Provider for a Terminating Pension Plan is a Fiduciary Duty
The Department of Labor (“DOL”) has sued an insurance brokerage firm, and its owner, for allegedly breaching fiduciary duties associated with purchasing an annuity contract for a terminating defined benefit plan. The complaint alleges that in 2003, the firm entered into an agreement to function as an ERISA fiduciary with respect to the purchase, for a …
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Congress Finally Passes Pension Funding Stabilization Provisions
Now that the excitement (or was that dread?) surrounding the Supreme Court’s ruling upholding the constitutionality of the health care reform legislation has dissipated somewhat, it seems timely to talk a little about pensions. At long last, and after several stalled efforts, meaningful pension funding stabilization legislation was enacted this summer. Congress passed and President …
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Fee Disclosures Are Almost Here — What Should Plan Sponsors Do Now?
The quickly approaching deadline for written fee disclosures by covered service providers creates new homework for plan sponsors–in the form of enhanced fiduciary review obligations and a suggested need to review (and/or create) written service agreements. By now folks who work in the tax-qualified retirement industry are well (and perhaps painfully) aware that the United …
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Fiduciary Litigation Update — Tussey v. ABB, Inc.
A recent case, Tussey v. ABB, Inc., has received much warranted and unwarranted attention in the Section 401(k) plan arena. In Part 1 of this legal update, we will explain the basics of what happened in this case. In Part 2, we will provide practical aspects of Tussey and deliver specific recommendations on how plan sponsors and fiduciaries can help minimize their potential fiduciary liability.
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ERISA Multi-employer Plan Contingent Liability Indemnification Provision is Not Prohibited by Public Policy
Multi-employer plans have been catching my eye lately. These plans, sometimes called “Taft-Hartley plans,” are maintained pursuant to collective bargaining agreements between unions and various employers. In Shelter Distribution, Inc. v. General Drivers, Warehousemen & Helpers Local Union No. 89, the collective bargaining agreement provided that the union would indemnify the company for any contingent …
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Allowing Employee Investment in an ESOP or 401(k) Employer Stock Fund Becomes a Bigger Gamble – Sixth Circuit Decision in Pfeil v. State Street Bank & Trust Co.
The Sixth Circuit has reversed the district court’s dismissal of the GM ERISA stock-drop suit, Pfeil v. State Street Bank & Trust Co., and is allowing the case to proceed. You may recall that we cautioned fiduciaries of ESOPs and 401(k) plans allowing investment in employer stock to keep an eye on this case because it could be a game-changer. And now it is.
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The Top-Hat Plan Test for Your ERISA Executive Deferred Compensation Plan – Daft v. Advest, Inc.
A recent Sixth Circuit decision provides a tutorial on designing and administering an ERISA executive compensation top-hat plan. In Daft v. Advest, Inc., a U.S. Court of Appeals for the Sixth Circuit reversed the District Court’s decision that the executive compensation plan was an ERISA plan but was not a top-hat plan, on the grounds …
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Requests for Proposal for 401(k) Plans
It was great to see everyone who was able to attend our Employment Relations seminar in Columbus yesterday—”Strategies to Help You Build a Winning Team.” We thought we would share one of the questions that was asked: is it necessary to seek requests for proposal (“RFPs”) for a 401(k) plan on a certain schedule? This …
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Ohio Federal Judge Allows Say-on-Pay Lawsuit to Proceed
I would like to direct our readers to a recent post by my partner – Bill McGrath on our sister blog – Federal Securities Law Blog titled “Ohio Federal Judge Allows Say-on-Pay Lawsuit to Proceed.”
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Definition of Fiduciary—Relief Or More of the Same?
The United States Department of Labor (the “DOL”) last week withdrew a proposed regulation that would have expanded the definition of “fiduciary” under ERISA in the context of retirement plans. (See our recent post that announced that withdrawal.) The regulation project was based on a belief that the old regulations defining the term, which originally were issued in 1975, were inadequate in today’s marketplace (a contention that seemingly drew little opposition in the abstract).
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