Cerner Corporation is the latest 401(k) lawsuit target over its retirement plan, citing high fees and a breach of fiduciary duty.
Cerner’s plan has over $2 billion in assets. Plaintiffs allege that Cerner breached its fiduciary duty by failing to objectively and adequately review the plan’s investment portfolio with due care to ensure that each investment option was prudent, in terms of cost; and maintaining certain funds in the plan despite the availability of identical or similar investment options with lower costs and/or better performance histories.
The complaint is short on facts. it states that the plaintiffs didn’t know all the facts necessary to understand that Cerner breached its fiduciary duties in violation of ERISA until shortly before the suit was filed. Besides, it says the plaintiffs didn’t have and don’t have actual knowledge of the specifics of the defendants’ decision-making process concerning the plan “because this information is solely within the possession of defendants before discovery.”
The complaint cites the usual expensive per head charges, as well as the belief that since passive funds are more expensive, Cerner’s use of it is a breach of fiduciary duty.