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Target Date funds

Court grants Intel’s motion to dismiss in litigation challenging the use of “non-traditional assets” in a TDF

On January 8, 2022, the United States District Court for the Northern District of California granted defendant plan fiduciaries’ motion to dismiss in Anderson v. Intel, a case involving a challenge to Intel’s inclusion of non-traditional assets (including hedge funds, private equity, and commodities) in Intel’s 401(k) plan default target date fund (TDF). Plaintiffs argued…Read More

District court grants summary judgment for defendants in fund underperformance case

On March 5, 2020, the United States District Court for the District of Colorado granted summary judgment in favor of defendant sponsor fiduciaries in Birse v. CenturyLink. The case – in which plaintiffs challenged the prudence of the selection of a fund in the CenturyLink 401(k) plan’s fund menu – is particularly interesting for the court’s…Read More

Supreme Court holds for plaintiffs in Sulyma v. Intel

ERISA’s 3-year statute of limitations does not apply where plaintiff “doesn’t remember” reviewing disclosure On February 26, 2020, the Supreme Court handed down its decision in Sulyma v. Intel, holding, in a unanimous opinion, that ERISA’s 3-year statute of limitations, which requires “actual knowledge” of the alleged breach, does not apply where, notwithstanding that the participant…Read More

Principal sued over target date fund structure

On April 16, 2018, a group of plaintiffs filed suit in the United States District Court for the Southern District of Iowa against a group of Principal affiliates, alleging that they violated their ERISA fiduciary duties of loyalty and prudence. The complaint is interesting in several respects: It extends the “identical lower cost investment available…Read More

Field Assistance Bulletin 2018-1 – DOL clarifies guidance on economically targeted investments and proxy voting, again

On April 23, 2018, the Department of Labor published Field Assistance Bulletin (FAB) No. 2018-01 on Interpretive Bulletins (IBs) 2015-01 (economically targeted investments) and 2016-01 (proxy voting). The issue of economically targeted investments (ETIs) (particularly) has become “political,” with the Clinton, Bush, Obama and (now) Trump DOL’s all weighing in with (differing) guidance on it….Read More

Deferred annuities in target date funds approved by IRS, DOL

On October 24, 2014, IRS released Notice 2014-66, providing guidance with respect to a program under which deferred annuities are included as “fixed income” investments in a target date fund (TDF). In connection with the Notice, the Department of Labor released a letter addressing certain fiduciary issues with respect to the program. In this article…Read More

Fiduciary issues for target date funds

One striking thing about the Department of Labor’s Target Date Fund (TDF) tip sheet was how much the ‘tips’ were simply a re-statement of general fiduciary rules applicable to choosing and monitoring any fund in a 401(k) plan fund menu. Even controversial ‘tips,’ such as “Inquire about whether a custom or non-proprietary target date fund…Read More

DOL publishes ‘tips’ for target date fund fiduciaries

On February 28, 2013, DOL published its long-awaited target date fund (TDF) ‘tips.’ In this article we review the DOL ‘tip sheet’ and TDF fiduciary issues generally. Background The late-2008 financial crisis had a particularly significant impact on some 401(k) plans that offered TDFs. In 2007 the Department of Labor had finalized its qualified default…Read More