PODCAST: Williams Mullen's Benefits Companion - ERISA Forfeiture Litigation
Last year, we alerted you to the filing of several class action lawsuits alleging that plan fiduciaries violated their duties of prudence and loyalty under Title I of ERISA by using forfeitures to reduce employer...more
Recent developments spotlight issues with forfeiture and other unallocated accounts in defined contribution retirement plans, such as 401(k) plans: •The IRS has set the deadline for plan forfeiture use. •Participants in...more
Last year, we alerted you to the filing of several class action lawsuits alleging that plan fiduciaries violated their duties of prudence and loyalty under Title I of ERISA by applying forfeitures to reduce employer...more
On this episode of Williams Mullen's Benefits Companion, host Brydon DeWitt discusses pending court cases regarding the proper use of forfeitures that arise under defined contribution plans. He outlines how these new...more
There has been a rash of lawsuits recently challenging how forfeitures are used in retirement plans. (Forfeitures are the amounts remaining when the unvested portion of a participant’s account is forfeited.) The novel theory...more
A federal district court recently granted a motion to dismiss claims that defined contribution plan fiduciaries breached their fiduciary duties of loyalty and prudence, and violated ERISA’s anti-inurement and prohibited...more
Conflicting orders on motions to dismiss from two California courts foreshadow issues for a new theory of ERISA liability. Employers have faced a recent wave of novel ERISA class actions that challenge the reallocation of...more
A recent rash of class action lawsuits in California claim that using forfeitures to reduce future employer contributions to tax-qualified retirement plans runs afoul of the Employee Retirement Income Security Act (ERISA)....more
In December, we suggested, contrary to popular opinion, that serious attention should be given to the filing of several class action lawsuits alleging that plan fiduciaries violated ERISA by applying forfeitures to reduce...more
The Employee Retirement Income Security Act ("ERISA") plaintiffs' bar has found a new way to allege that 401(k) plan sponsors have breached their fiduciary duty....more
A handful of new ERISA litigation cases (including McManus v. Clorox Co., N.D Cal. No. 4:23-cv-05325) are taking aim at forfeiture accounts and trying to pull them into the never-ending list of ways in which retirement plan...more
When a participant terminates employment without being fully vested in their qualified retirement plan account, the non-vested portion of the account is a “forfeiture.” While forfeitures are a common element of most...more
The constitutionality of California’s felony forfeiture statute, as applied by the Board of Administration of the California Public Employees’ Retirement System (CalPERS), survived yet another challenge in September 2023,...more
The March Monthly Minute highlights new proposed deadlines for use of retirement plan forfeitures, unsuccessful efforts to overturn the final ESG rule, and ACA penalty increases for 2024. Sorry Not Sorry: Biden Vetoes...more
David Johnson presented his paper on “Fiduciary Compensation and Forfeiture” to the Southwest Association of Bank Counsel fall legal conference on September 15, 2022, in Fort Worth, Texas. David addressed a fiduciary’s duty...more
A business divorce may mean that the owners need to sell the business or the business’s assets. In the following case, some of the owners/officers took advantage of a sale transaction to benefit from that transaction at the...more
Historically, the incidence of “serious” defaults (“serious” meaning contribution failures that persist to a point in time at which consideration of enforcement action is necessary) in institutional venture capital funds is...more
This quarter’s issue includes summaries and associated court opinions of selected cases principally decided between May and August 2019....more
The Probate & Fiduciary Litigation Newsletter compiles recent Trust & Estate cases. Our lawyers are at the forefront of this area of the law, shaping how it is handled in the Probate and Family Court. Goulston & Storrs is the...more
This Client Advisory highlights important developments in the law governing employee benefit plans and executive compensation over the past year. It offers insight into what these developments mean for employers and plan...more
Use of Forfeitures for Safe Harbor Contributions, QNECS and QMACS - The Internal Revenue Service (IRS) recently issued final regulations allowing forfeitures in 401(k) plans to be used to fund safe harbor contributions,...more
In Cruz v. Ghani, a limited partner sued a general partner over breach of fiduciary duty claims arising from, among other allegations, that the general partner should not have compensated himself from the business in addition...more
California has long led the nation in its disdain for noncompetition agreements. Pressed by venture capitalists who believe that this gives California an advantage over other states, the Massachusetts legislature has finally...more
In his iconic book, The Story of Doctor Dolittle, children’s author Hugh Lofting introduces the world to a mythic animal -- the pushmi-pullyu -- that has two heads on the opposing ends of its body, begging the questions: 1)...more
In Samuel D. Orbison & Am. Piping Inspection v. Ma-Tex Rope Co., a jury found that a former employee breached fiduciary duties by working for a competitor while being employed by the plaintiff. No. 06-17-00112-CV, 2018 Tex....more