Fiduciary Breach Claims Barred by ERISA’s Six-Year Statute of Limitations

The Eleventh Circuit recently dismissed a participant’s fiduciary breach claims against SunTrust’s 401(k) plan fiduciary committee members on the ground that the claims for imprudently selecting certain investment options was time barred by ERISA’s six-year statute of limitations. Fuller v. Suntrust Banks, Inc., 2014 WL 718309 (11th Cir. Feb. 26, 2014). Plaintiff Barbara Fuller argued that the addition of proprietary mutual funds was imprudent because the funds performed poorly and their high fees served as revenue to SunTrust subsidiaries. The district court dismissed her claim on the ground that she had “actual knowledge” of Defendants’ alleged fiduciary breaches over three years before filing her complaint. The Eleventh Circuit disagreed, observing that Fuller could not be said to have “actual knowledge” of the alleged breaches because Defendants did not show that the plan documents were provided to her or that she obtained knowledge of the facts in the documents from a different source. The Eleventh Circuit held, however, that ERISA’s six-year statute of limitations barred Fuller’s claims. It reasoned that the committee’s selection of the challenged investment funds occurred more than six years before Fuller filed her complaint. Moreover, to the extent that she also claimed that the alleged failure to remove the funds in subsequent years was imprudent, the Court determined that the claim was “in all relevant respects identical to the allegations concerning the selection process.”

Topics:  401k, Breach of Duty, ERISA, Fiduciary Duty, Statute of Limitations

Published In: Business Torts Updates, Civil Procedure Updates, Finance & Banking Updates, Labor & Employment Updates, Securities Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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