December 6, 2021

Volume XI, Number 340

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December 03, 2021

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401(k) Plan Participant Cannot Pursue Claims On Behalf Of Plans In Which She Did Not Participate

A federal district court in Ohio concluded that a 401(k) plan participant could assert fiduciary breach and prohibited transaction claims only on behalf of the plan in which she participated, and not on behalf of other plans.  In this case, the plaintiff was a participant in Andrus Wagstaff, PC’s 401(k) plan, and she alleged that the plan’s recordkeeper charged the plan excessive recordkeeping fees.  The plaintiff sought to certify two classes:  (1) a plaintiff class, represented by plaintiff, consisting of all participants in 401(k) plans that had similar recordkeeping agreements with Nationwide; and (2) a defendant class, represented by Andrus Wagstaff, PC, of all plan sponsors of 401(k) plans that had similar agreements with Nationwide. 

Before considering whether plaintiff’s putative classes satisfied Rule 23, the district court addressed the threshold issue of whether plaintiff had standing to represent and/or sue the putative classes.  The court found that plaintiff lacked standing to sue each of the allegedly thousands of similarly situated 401(k) plan sponsors because each plan had different agreements with Nationwide and therefore her alleged injury, i.e., excessive fees, was not traceable to one shared contract.  The court then concluded that plaintiff could only assert class claims on behalf of the Andrus Wagstaff, PC’s 401(k) plan in which she participated. 

The case is Brown v. Nationwide Life Insurance, No. 2:17-cv-558, 2019 WL 4543538 (S.D. Ohio Sept. 19, 2019).

© 2021 Proskauer Rose LLP. National Law Review, Volume IX, Number 275
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About this Author

Tulio D. Chirinos, Labor, Employment, Attorney, Proskauer, Law firm
Associate

Tulio D. Chirinos is an Associate in the Labor & Employment Department, and a member of the Employee Benefits, Executive Compensation, and ERISA Litigation Practice Center, resident in the New Orleans office.

Tulio works on a wide variety of employment law and benefit matters, including Title VII of the Civil Rights Act, the Fair Labor Standards Act, ERISA breach of fiduciary duty claims, and ERISA benefits claims. He is also a contributing author to Chapter 20 of the fifth edition of BNA’s ERISA Litigation treatise, which will be published in 2014. Prior to joining...

504-310-2048
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