"This Technical Release addresses two issues. First, to the extent proxy advisory firms either: [1] exercise authority or control over shareholder rights attributable to shares that are ERISA plan assets, including the voting of proxies; or [2] provide advice for a fee to ERISA plans about how such plans should exercise proxy voting rights attributable to shares of stock they own, this Technical Release clarifies that such proxy advisory firms must meet ERISA's functional fiduciary requirements.
"Second, and relatedly, where a state law mandates disclosure to investors by proxy advisory firms only when they make recommendations other than for the purpose of maximizing risk-adjusted return for the advisee, such laws are generally not preempted by ERISA. ERISA fiduciary provisions do not alter this result. ERISA's fiduciary duties require that actions be taken with respect to a plan investor only for the purpose of maximizing risk-adjusted financial return. For that reason, no plan governed by ERISA should ever receive a disclosure under such a state disclosure law, and, accordingly, no relationship between that law and any ERISA plan would be created. Consequently, such a state law neither has an impermissible connection with, nor makes a prohibited reference to, ERISA plans, and it generally would not be preempted by ERISA." MORE >>
"[Executive Order 14366] makes clear that EBSA should not just examine whether proxy advisors' actions meet the test to make them investment advice fiduciaries but also asked the department to look at other actors who manage, or advise those that manage, the rights connected to shares of stock, such as the right to vote for board members, held by ERISA-covered plans. Proxy advisors have played a central role in politicizing the capital markets by pursuing ESG investing and DEI positions, but they aren't alone. At the President's directive, EBSA's Technical Release looks beyond the proxy advisors to consider when the actions of others, such as large asset managers, sovereign wealth funds, and the overseers of the proxy plumbing, render them investment advice fiduciaries." MORE >>
"The DOL is signaling that how plan fiduciaries make decisions matters more than what they ultimately select. A robust, well-documented investment selection process, grounded in the proposed rule's six factors, will be critical to managing fiduciary risk, particularly as plans consider more complex or alternative investment options. The proposed rule provides a roadmap for how fiduciaries should select (and ultimately monitor) investments, and how to document their process." MORE >>
"For the moment, though, pay particular attention to the Proposal's six defined factors. For each factor, there is a standard that reflects the DOL's expectations of plan fiduciaries. In addition, there are examples of prudent and imprudent fiduciary behavior under each example. Those factors, standards, and examples reflect the DOL's thinking. That thinking is consistent with views on retirement plan professionals in most cases. While some may be different or more demanding than current practices, they still reflect the behavior that the DOL clearly expects from fiduciaries, and fiduciaries should take that into account as they undertake their activities on behalf of plans." MORE >>
"A federal judge allowed proceedings in a slate of consolidated complaints against the Cigna Group to move forward because the case does not entirely rest on the outcome of the Supreme Court's future ruling in a similar case.... [The judge] argued that pausing the Cigna lawsuits -- which involve both underperformance and forfeiture misuse claims -- would be unfair to the plaintiffs because the resolution of [Anderson v. Intel] will not address all liability theories alleged in the Cigna actions." [In re Cigna ERISA Litigation, No. 25-2465 (E.D. Penn. Apr. 8, 2026)] MORE >>
"This article explores 3(16) fiduciary services, what truly are 3(16) services, why viewing them through the lens of 'risk mitigation' is misleading, and how employers should properly evaluate and benefit from this growing service model." MORE >>
"A growing number of financial advisors are considering pooled employer plans (PEPs), as more value streamlined administration strategies and reduced fiduciary risk.... [O]ver 80% of respondents listed fiduciary risk mitigation as a primary influencer shaping their views of PEPs, and another 80% believe that using the features 'significantly or moderately reduce administrative burden.' " MORE >>
"We are seeing the migration of 401(k)-style fiduciary claims to health plans, accelerated by transparency requirements established by the Consolidated Appropriations Acts of 2021 and 2026. The unifying question is often not whether a single rule was violated, but whether the plan sponsor followed a prudent fiduciary process." MORE >>
"Lisa Gomez, the former head of [EBSA] explained ... that the Investment Selection Proposal does not create 'immunity from liability,' as it is currently written.... Gomez explained that fiduciaries with 'decision-making authority' over investment menus, such as sponsors and managers, still must have a prudent process for investment selection and monitoring because 'a safe harbor is not immunity from liability.' " MORE >>
"The DOL's recently proposed rule on alternative investments ignores the fact that ERISA section 404(a) requires a plan sponsor to conduct an independent investigation and evaluation on each investment option chosen for a 401k plan. However, the very nature of alternative investments typically involves a basic lack of transparency, which effectively prevents the verification by a plan sponsor required by ERISA 404(a)." MORE >>
"Public pensions, normally the first to lead securities fraud cases, have been notably absent from the Apollo/Epstein stock drop litigation. That absence may reflect a deeper conflict: the same pensions that could sue Apollo for misleading disclosures are heavily invested in its private equity and private credit funds, where valuations remain opaque and untested." MORE >>
"The DOL's proposal is much broader than anticipated and represents a new interpretation by the DOL of ERISA's duty of prudence.... Managers of alternative investments should consider the proposal's implications on fee transparency, liquidity management, and valuation processes.... The DOL anticipates issuing separate interpretive guidance relating to the duty to monitor. Public comments on the proposal are due on June 1, 2026[.]" MORE >>
"[T]he Proposed Rule provides a welcome roadmap to plan fiduciaries responsible for selecting all of a plan's designated investment alternatives, not only those that relate to alternative assets. The regulation, when finalized, will allow fiduciaries to demonstrate their compliance with ERISA's fiduciary duty of prudence. However, it remains to be seen whether the Proposed Rule will deter ERISA litigation." MORE >>
Slide Deck. "[1] Background -- executive order: Democratizing access to alternative assets for 401(k) investors ... [2] Summary of proposed rule: Fiduciary duties in selecting designated investment alternatives ... [3] Safe harbor factors when selecting designated investment alternative ... [4] Specific requests for comments within 60 Days ... [5] Topics explicitly not addressed ... [6] Considerations for plan fiduciaries." MORE >>
"[T]he court held that participants who received every promised benefit could still demonstrate injury in fact under Thole... by alleging they paid too much for that coverage. Second, the court declined to resolve the settlor doctrine defense at the motion to dismiss stage, holding that whether Northwestern's decisions regarding the design of coverage options constitute fiduciary or settlor functions is a 'fact-intensive' inquiry better suited for summary judgment." [Barbich v. Northwestern Univ., No. 25-6849 (N.D. Ill. Apr. 2, 2026)] MORE >>
"The familiar contours of what has been feasible for decades, and which have shown recent signs of renewed energy -- so-called target-date, life-cycle and other 'allocator' strategies of which Alternative Assets are a component -- will continue to be the likely theatre of operations for the near future." MORE >>
"Recordkeepers now operate as platforms, not just service providers. They control most participant touchpoints while plan sponsors retain the fiduciary risk.... Infrequent recordkeeper changes and captive participants give recordkeepers durable commercial leverage.... Participant data use, indirect compensation, and rollover recommendations are emerging exposure areas.... Outdated contracts, limited monitoring, and infrequent RFPs leave sponsors exposed.... Sponsors must understand, monitor, and periodically re-market their recordkeeping arrangements." MORE >>
"The lawsuit ... claims Northwestern violated its fiduciary duty as a plan sponsor under [ERISA]. According to the complaint, the university offered multiple preferred provider organization health plans but failed to properly evaluate and disclose that one option -- the higher-premium 'Premier PPO' -- provided no meaningful advantage over cheaper alternatives." [Barbich v. Northwestern Univ., No. 25-6849 (N.D. Ill. Apr. 2, 2026)] MORE >>
"The Proposed Rule provides guidance to plan fiduciaries but does not ensure that asset managers will offer products that satisfy fiduciary standards.... The Proposed Rule anticipates that plan fiduciaries will turn to their investment advisers and asset managers to obtain representations regarding the six factors in the safe harbor.... [T]he additional representations and due diligence required to rely on the safe harbor may increase fees charged by investment advisers, asset managers, or both. Plan fiduciaries should review their service agreements to determine whether these extra services are included and at what cost. " MORE >>
"While the general statement of the requirement of prudence on the part of an ERISA plan fiduciary states that there is an obligation of the fiduciary to consider all relevant factors, and that this applies to the valuation of alternative assets as a plan investment option available to participants, this same fiduciary obligation can equally be read to require, with respect to more traditional types of plan investment options, that there be an evaluation of such matters as the impact on an investment of environmental factors, benefits of a diverse workforce and other governance and societal implications of the businesses included in the investment choices available to plan participants." MORE >>
"[T]he complaint asserts that Cushman's management of the plan, particularly the absence of any sort of climate risk analysis, fails to live up to the fiduciary standards mandated by ERISA.... [M]any of the underlying allegations, such as underperformance and comparatively high fees, mirror more traditional ERISA fiduciary breach claims." [Kvek v. Cushman & Wakefield U.S., Inc., No. 26-0736 (W.D. Wash. complaint filed Mar. 3, 2026)] MORE >>
"For plan sponsors willing to do due diligence, CITs can potentially reduce costs, improve flexibility, and support better long‑term outcomes for participants. But they can introduce risk and confusion just as easily as any other investment vehicle." MORE >>
"The proposed rule sets out a compelling analytical framework focused on six-factors -- performance, fees, liquidity, valuation, benchmarking and complexity ... [T]he proposed rule invites and encourages plan fiduciaries to consider all asset classes that will provide retirement investors with risk-adjusted returns that further the purposes of the plan, including through the use of alternative asset classes." MORE >>
"The DOL's proposal would introduce a safe harbor for offering alternative investments in 401(k) plans. The Supreme Court's review could clarify fiduciary liability and proof standards. These changes may accelerate adoption of private market assets in defined contribution plans." [Anderson v. Intel Corp. Inv. Policy Comm., No. 22-16268 (9th Cir. May 22, 2025; cert. pet. granted Jan 16, 2026, No. 25-498)] MORE >>
"[Judge Kymberly Evanson] dismissed the case on substantive grounds, noting that nearly all allegations about Athene's financial condition arose after the relevant transaction and thus did not show that the defendants breached their fiduciary duties when choosing Athene for the 2019 transaction." [Maneman v. Weyerhaeuser Co., No. 24-2050 (W.D. Wash. Mar. 31, 2026)] MORE >>
