October 2017 Archive

Favorable ruling for Fidelity in self-directed brokerage, Financial Engines case

October 05, 2017

On September 22, 2017, the United States District Court for the District of Massachusetts found for defendant in Fleming v. Fidelity. The case involves two emerging issues in 401(k) plan litigation – the status under ERISA of self-directed brokerage (SDB) arrangements and of Financial Engines fee-sharing arrangements. In this article we briefly review the court’s decision. Read More

Minnesota district court sides with defendant-fiduciaries in stock drop case

October 03, 2017

On September 21, 2017, the United States District Court for the District Of Minnesota dismissed plaintiffs’ complaint in In Re: Wells Fargo ERISA 401(K) Litigation. Wells Fargo is a stock drop case in which plaintiffs alleged that fiduciaries of the Wells Fargo 401(k) plan had inside information that Wells Fargo stock was overpriced and breached their ERISA fiduciary duty of prudence when they did not take any action to stop ongoing stock purchases. Read More

Current pension outlook – October 2017

October 30, 2017

In this current outlook we discuss (1) reports that House Republicans are considering “Rothification” of 401(k) contributions over $2,400, (2) the possibility of a solution to regulatory obstacles to Open MEPs based on President Trump’s Healthcare Executive Order, (3) legislation approved by the House Financial Services Committee repealing the Department of Labor’s fiduciary rule, (4) the ERISA Industry Committee’s suit against the state of Oregon claiming that Oregon’s state retirement program is in some respects preempted by ERISA and (5) President Trump’s naming of a new head of the Department of Labor Employee Benefit Security Administration. Read More

IRS finalizes mortality table guidance for 2018

October 23, 2017

On October 5, 2017, the IRS published (1) final regulations/mortality tables for determining the present value of benefits under defined benefit plans for funding, Pension Benefit Guaranty Corporation premiums and lump sum valuations, (2) a revenue procedure for sponsor requests for the use of plan-specific substitute mortality tables and (3) a notice providing updated static mortality tables for 2018. Read More

2018 Increases for Retirement Plans, Social Security

October 15, 2017

The Social Security Administration just announced benefit increases effective in 2018. These changes will affect benefits for currently retired individuals, as well as those contemplating retirement. Employers who sponsor retirement plans that are ‘coordinated’ with Social Security in some fashion will also see an impact on benefits earned and payable under such plans. Read More

September 2017 Pension Finance Update

October 02, 2017

Pensions enjoyed their best month of the year in September, driven by the salutary combination of strong stock markets and rising interest rates. Both model plans we track saw improvements last month – traditional Plan A improved more than 2% and is now up more than 3% for the year, while the more conservative Plan B gained close to 1% in September and is now ahead more than 1% through the first three quarters of 2017. Read More

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