In an article published by InvestmentNews, Bass, Berry & Sims attorney Doug Dahl provided insight on a recent district court ruling which allowed allegations that using multiple record-keeping firms in 403(b) retirement planning breaches fiduciary duty to continue. With many other prominent institutions involved in similar litigation, this particular lawsuit targets Emory University, and the decision to move forward could potentially impact the success of similar claims in those other cases. The plaintiffs claim that using multiple record-keeping systems burdens participants with fees because it is cost prohibitive and doesn’t adequately leverage assets to drive lower pricing. “This is a relatively new, or at least a newly successful, claim,” said Doug. While the article notes that it is still unclear whether there is anything necessarily wrong with the use of multiple service providers, Doug adds “I think the fact that the claim continued is definitely noteworthy.”
The full article, “Use of Multiple Record Keepers Could Hurt Defendants in 403(b) Lawsuits,” was published by InvestmentNews on May 19, 2017, and is available online.