"[Plan] sponsors would have to take speedy action to maintain their existing QPAM relationships by amending their contracts to add new required provisions within 60 days. These provisions -- which include a requirement that QPAMs reimburse plans for certain losses -- might increase the cost of asset-management services."  MORE >>

"[T]he Third Circuit was tasked in deciding whether fiduciaries of the Johnson & Johnson ESOP ... violated their fiduciary duties by failing to protect the ESOP's beneficiaries from a stock price drop which followed from growing allegations and lawsuits related to asbestos in Johnson's Baby Powder.... Plaintiffs allege two alternative actions that the ERISA fiduciaries should have taken ... The Third Circuit determined that neither of these actions satisfies Dudenhoeffer because a prudent fiduciary in the Defendants' position could have concluded that either action would harm more than help the ESOP." [Perrone v. Johnson & Johnson, No. 21-1885, 2022 WL 4090301 (3d Cir. Sep. 7, 2022)]  MORE >>

"Notwithstanding an initial set of discouraging post-Hughes opinions denying motions to dismiss ... the more recent trend has turned in a more favorable direction. In addition to the ruling in Oshkosh, the Sixth Circuit (in two separate cases) and two district courts have affirmed dismissal of similar fee and investment claims. These decisions show that in a post-Hughes environment, courts will still (and arguably must) dismiss complaints that fail to strictly adhere to the applicable pleading standards." [Albert v. Oshkosh Corp., No. 21-2789 (7th Cir. Aug. 29, 2022)]  MORE >>

"[T]he Seventh Circuit in Oshkosh has issued an opinion that limits the ability of plaintiff law firms to create a liability trap for plan fiduciaries who utilize revenue sharing and active funds in their investment lineup.... The key takeaway from Oshkosh is that we now have both the Seventh and Sixth Circuit's interpreting the Supreme Court's decision in Hughes v. Northwestern narrowly." [Albert v. Oshkosh Corp., No. 21-2789 (7th Cir. Aug. 29, 2022)]  MORE >>

"[The opinion synthesizes] the historical case law and [provides] guidance and clarification on when mandatory class action waiver and arbitration provisions in ESOP plans are enforceable. Ultimately, the Court compelled the plaintiff to arbitrate her claim on an individual basis, enforcing the mandatory class action waiver and arbitration provisions set forth in the ESOP plan document." [Robertson v. Argent Trust Co., No. 21-1711 (D. Ariz. Jul. 27, 2022)]  MORE >>

"[M]any courts have taken the view that a pension plan loan does not create a 'debt' for purposes of the bankruptcy.... [A] bankruptcy court has challenged this seemingly well established concept ... [If] pension plan loans are treated as 'debts' ... by more bankruptcy courts, then pension plans may face increased litigation arising from participant bankruptcies. This could include ... efforts by a chapter 7 trustee to claw back loan repayments made prior to bankruptcy[.]" [Montoya v. Dubbin (In re Dubbin), No. 19-12040-17 Adv. 21-1004-t (Bankr. D.N.M. Aug. 6, 2021)]  MORE >>

"In this fast-changing environment, to minimize the risk of lawsuits and DOL investigations based on ERISA's duty of prudence, plan sponsors and fiduciaries considering ESG investments may wish to consider ... [1] Focus on process ... [2] Implement rigorous documentation ... [3] Economics still matter ... [4] Monitor developments."  MORE >>

"Pension finances were mixed during August, as higher interest rates offset the impact of falling stock markets. Both model plans ... were close to even last month: Plan A improved less than 1% and is now up almost 5% for the year, while the more conservative Plan B lost a fraction of 1% in August and is now down 1% through the first eight months of 2022."  MORE >>

"Overall, the same lesson that has been mentioned previously this year still holds true: if you are only looking at the asset side of the ledger, you would assume performance is terrible. However, the results here show most plans actually have improved their funded position during 2022 as higher interest rates should reduce pension liabilities."  MORE >>

"The American Rescue Plan Act of 2021 created funding relief for single-employer defined benefit pension funds by extending the amortization period for shortfalls and stabilizing the interest rates used to calculate their funded level."  MORE >>

"[W]ith most plan sponsors now focused on fees, aggressive and opportunistic law firms have found a new target: past performance. Ten companies, typically those with more than $500 million in assets in their 401(k) plans, face allegations that they violated their fiduciary duty by only focusing on selecting a low-cost option over better-performing peers.... [Q]uestioning if a plan sponsor fulfilled its fiduciary responsibilities based largely on past performance can incite frequent swapping of investment options when they aren't top performers to avoid similar lawsuits in the future."  MORE >>