When I think of Gucci, I think of a high priced brand. Coincidentally or not, they are being accused of running a high priced 401(k) plan. Selling high priced leather goods is OK, running an expensive 401(k) plan is not.
Like many cases today, the lawsuit seeking class action status is accusing the plan sponsor of using expensive proprietary products from its bundled recordkeeper. The plaintiff accuses Gucci of using expensive Transamerica proprietary funds and failing to rein in revenue sharing payments. These proprietary fund lawsuits are a no brainer for ERISA attorneys because these make plan sponsors an easy mark for litigation.
What is interesting about the plan is that Gucci’s 401(k) plan only had $96 million in it, hardly a large plan. That’s something every plan sponsor and plan provider should recognize: that litigation is trickling down to smaller plans, it’s not just for billion dollar plans anymore.