It seems like every week, there is another major lawsuit against a plan sponsor and one of their service providers.
Allegations of impropriety are just allegations until decided by a trier of fact of whether they are substantiated or not. Just because a plan sponsor and their service provider is being sued, doesn’t mean they did anything wrong.
ERISA litigators have to eat too and sometimes they pick cases that aren’t going to put food on the table. I’ve seen too many lawsuits against some big time plan providers that I know will end up going nowhere because the service provider being alleged to have done something wrong is being sued because the ERISA litigator is considering that service provider is a fiduciary. Alleging that a service provider is a fiduciary is one thing, proving that is a lot harder.
I just saw a lawsuit against one of the big time service provider in this business where the plan participants claim that they are a fiduciary and that they breached their fiduciary duty by farming out their fiduciary duties to another provider. It’s a head scratcher because this service provider is pretty careful and I doubt any of their actions as a plan provider made them a fiduciary.
ERISA litigators like to go fishing and they like big fishes like Fidelity and Vanguard. Whether they catch them or not is a whole other story.