A federal district court in Illinois held that participants in a multiemployer pension plan failed to plausibly allege that plan fiduciaries retaliated against them in violation of ERISA § 510 by refusing to consider their employer’s offer to settle its withdrawal liability to the plan. In lieu of paying withdrawal liability, the employer offered to
ERISA Implications for Firing A Whistleblower
The Ninth Circuit unanimously concluded that a trustee and lawyer for certain multiemployer funds violated ERISA § 510 by unlawfully firing a whistleblower in the funds’ collections department, but, in a split decision, concluded that the retaliation did not amount to a breach of fiduciary duty. The whistleblower was cooperating with a DOL criminal investigation
Ninth Circuit Deepens Circuit Split Over Whether Delinquent Contributions Are Plan Assets
The Ninth Circuit held that employer contributions due to a Taft Hartley fund are not plan assets until they are actually paid to the fund, irrespective of whether the plan document defines plan assets to include unpaid employer contributions. As a result, a fund could not hold a contributing employer’s owner and treasurer personally liable
Seventh Circuit Rejects “Big Buyer” Defense to Successor Liability
For a multiemployer pension fund to hold an asset purchaser liable for withdrawal liability as a successor-in-interest, the fund must establish that the purchaser was (i) on notice of the seller’s withdrawal liability, and (ii) the purchaser “substantially continued” the seller’s operations. In Ind. Elec. Workers Pension Benefit Fund v. ManWeb Servs., No. 16-cv-2840,
Third Circuit Deepens Circuit Split Over Test for “Top Hat” Status Under ERISA
A Third Circuit decision, Sikora v. UPMC, 876 F.3d 110 (3d Cir. 2017), deepens a circuit split over whether a participant’s bargaining power is relevant to determining whether a plan qualifies for “top hat” status under ERISA.
Plans that qualify for “top hat” status are exempt from ERISA’s eligibility, vesting, funding, and fiduciary requirements.
District Court Dismisses Allegations That Stable Value Fund is Too Conservative
A district court in Rhode Island dismissed claims by participants in the CVS Employee Stock Ownership Plan that plan fiduciaries imprudently invested plan assets in the plan’s stable value fund. Plaintiffs argued that the stable value fund had an excessive concentration of investments with ultra-short durations and excessive liquidity, both of which caused the fund
Sixth Circuit Dismisses ERISA Stock Drop Action Against Cliffs Natural Resources
The Sixth Circuit affirmed the dismissal of ERISA stock drop claims by participants in the Cliffs Natural Resources’ 401(k) Plan. The participants alleged fiduciary breach claims based on public and non-public information arising out of the collapse in iron ore prices that caused the company’s stock price to decline 95%. With respect to the public
Second Circuit Affirms Dismissal of Claim Arising from Incorrectly Addressed COBRA Notice
In Vangas v. Montefiore Medical Center, 2016 WL 2909354 (2d Cir. May 19, 2016), the Second Circuit affirmed the district court’s holding that an employer is not liable for failing to provide a COBRA notice to a terminated employee under ERISA § 502(c) where the employer followed reasonable procedures to ensure that notices were
Anti-Assignment Provision Bars Surgery Center’s $3.3 Million ERISA Benefits Claims
A federal district court in California held that the ILWU-PMA Welfare Benefit Plan’s anti-assignment provision barred Brand Tarzana Surgical Institute’s claim for benefits and thus dismissed the Institute’s claim for benefits. In so holding, the court rejected the Institute’s argument that the plan waived the right to assert the anti-assignment provision as a defense by
On Remand, District Court Rules for the Fiduciaries in Tatum v. R.J. Reynolds
The R.J. Reynolds defendants have again prevailed against allegations that they breached their fiduciary duties by divesting the RJR 401(k) plan of funds invested in Nabisco stock. Following remand by the Fourth Circuit, the district court held that a hypothetical fiduciary “would” have divested the plan of the Nabisco investments in the same time and