Understanding Employee Benefits and key developments in the employee benefits field and items of interest to our clients. MORE

In past articles in this Blog I reported on decisions of the 9th Circuit Court of Appeals and ultimately the U.S. Supreme Court dealing with a class action for breach of fiduciary duty for selecting retail mutual funds in 1999 for which lower costs institutional funds were available. https://benefitsnotes.com/2013/04/ninth-circuit-decides-selection-of-retail-mutual-funds-was-a-breach-of-fiduciary-duty/ ;  https://benefitsnotes.com/2015/05/supreme-court-401k-plan-fiduciaries-have-an-ongoing-duty-to-monitor-2/  The case stalled

This week, new U.S. Department of Labor Secretary Acosta announced that the final fiduciary regulations would go into effect on June 9, 2017. The Department also issued two pieces of guidance with regard to the regulations also referred to as the “Conflicted Advice Rules”.  The guidance consists of a set of FAQs issued by the

On March 22, 2017, the U.S. Court of Appeals for the Second Circuit ruled against Christine Bodouva that her restoration of funds to her Company’s 401(k) Plan should be offset against the District Court’s order for forfeiture in her criminal trial. U.S. v Christine Bodouva, Case 16-3937, 2nd Cir. 3/22/17.

BACKGROUND

Ms. Bodouva

Last June I blogged about the trend of participant fee class actions moving down to smaller 401(k) Plans. https://benefitsnotes.com/2016/06/inside-trustees-for-small-minnesota-401k-plan-face-class-action-over-excessive-fees/ Occasionally, class actions are brought based on other breaches of fiduciary duties, particularly those involving significant drops in value of concentrated Plan investments such as employer stock referred to as “Stock Drop Cases”.  A similar class

On September 16, 2016, the IRS and the Department of the Treasury requested public comment on ways the IRS and Treasury “can improve compliance…by making it easier for plan sponsors to satisfy requirements for qualified plan documents” in the wake of the determination letter program changes (Announcement 2016-32). In June, the Internal Revenue

A Minneapolis law firm recently filed a class action complaint against Lamettry’s Collision, Inc. and the Trustees of its 401(k) Plan, CFO Stephen Daniel and President Joan Lamettry for various breaches of fiduciary duty with respect to fees charged to Plan participants’ accounts in the Company’s 401(k) Plan. Specific allegations include: (a) failure to assess

On November 9, 2015, Minnesota Federal District Judge Susan Richard Nelson ruled that the president and CEO of Faribault Woolen Mills Company breached his fiduciary duties under ERISA by diverting Employee health insurance premiums toward corporate and personal use. The lawsuit was brought by the U.S. Department of Labor.

Facts:

Faribault Woolen Mills (the

In a private letter ruling released on September 18, 2015 (PLR 201538021),  the Internal Revenue Service concluded that an employer organized as a limited liability company (LLC) under a state statute, upon making a federal tax election to be taxed as a corporation, can adopt an employee stock ownership plan under Internal Revenue Code Section