News & Analysis as of

Retirement Plan Forfeiture

Ary Rosenbaum - The Rosenbaum Law Firm P.C.

Schlicter targets Charter in Forfeiture case

Schlichter Bogard, LLC represents participants of the $7 billion Charter Communications, Inc. 401(k) Savings Plan in a class action against Charter Communications, Inc....more

Holland & Knight LLP

Northern District of California Dismisses 401(k) Forfeiture Suit with Prejudice

Holland & Knight LLP on

In Hutchins v. HP Inc., the U.S. District Court for the Northern District of California dismissed – with prejudice – the plaintiff's claims challenging the use of forfeited employer 401(k) contributions. This is the latest...more

Shipman & Goodwin LLP

Plan Forfeiture Litigation: A Trend to Watch

Shipman & Goodwin LLP on

The most recent wave of ERISA litigation is focused on the use of plan forfeitures in 401(k) plans, with the newest case, Armenta v. WillScot Mobile Mini Holdings Corp. being filed just last week. Although, for years, many...more

Holland & Knight LLP

An Emerging Trend in ERISA Class Action Litigation: 401(k) Forfeiture Suits

Holland & Knight LLP on

There has been a recent uptick in ERISA class actions challenging the use of 401(k) plan forfeitures. Forfeitures are employer contributions that participants forfeit when they leave employment before those contributions vest...more

The Wagner Law Group

Forfeiture Accounts Hold More Than Nonvested Employer Contributions

The Wagner Law Group on

The Wagner Law Group continues to monitor the ongoing flood of “forfeiture” litigation. This alert is our seventh reporting on and analyzing the nature of the claims raised by plaintiffs, the defenses asserted against them,...more

The Wagner Law Group

Update – Recent Developments in Forfeiture Cases

The Wagner Law Group on

The Wagner Law Group continues to monitor the recent flood of retirement plan “forfeiture” litigation. This alert is our eighth update reporting on and analyzing the nature of the claims raised by plaintiffs, the defenses...more

Quarles & Brady LLP

Forfeiture Funds: Legal Requirements, Permitted Uses, and Litigation Risk Management

Quarles & Brady LLP on

Forfeiture funds in 401(k) plans represent a unique asset pool with specific regulatory requirements and practical applications. Forfeiture funds arise when participants terminate employment with the company before becoming...more

Carlton Fields

Practical Thoughts for Sponsors About Current ERISA Forfeiture Litigation

Carlton Fields on

A notable trend in ERISA litigation has emerged as in-house attorneys look to mitigate the risks of coming waves of class action litigation. Beginning in late 2023, there have been several challenges to the use of forfeiture...more

Ary Rosenbaum - The Rosenbaum Law Firm P.C.

BAE wins forfeiture case

BAE Systems Inc. has won a class action lawsuit about misusing 401(k) plan forfeitures. U.S. District Judge Anthony Trenga, of the U.S. District Court for the Eastern District of Virginia, granted BAE’s motion to dismiss...more

Groom Law Group, Chartered

Defendants Secure Another Win on Discretionary Use of 401(k) Plan Forfeitures

On September 19, 2024, the Southern District of California dismissed claims brought by a 401(k) plan participant against Thermo Fisher Scientific Inc. regarding the use of forfeitures to offset future employer contributions. ...more

Ary Rosenbaum - The Rosenbaum Law Firm P.C.

The end of forfeitures to reduce contributions is inevitable

Recently had a client going through an Internal Revenue Service (IRS) audit and while talking to an agent, they didn’t disagree with my theory that the idea of being able to reduce employer contributions through forfeitures...more

The Wagner Law Group

District Court Grants Motion to Dismiss Forfeiture Complaint

The Wagner Law Group on

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

Warner Norcross + Judd

Attention Auto Suppliers: Don’t Leave Money on the Table Through Unused Retirement Forfeitures and Unallocated Accounts

We understand that running an automotive supplier business involves more than just industry-specific issues. That's why we regularly provide important insights and tips on broader legal trends to help you navigate challenges...more

Warner Norcross + Judd

Attention: Forfeitures and Other Unallocated Accounts in Retirement Plans Need Review

Warner Norcross + Judd on

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

The Wagner Law Group

Forfeiture Cases – Update

The Wagner Law Group on

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

Williams Mullen

PODCAST: Williams Mullen's Benefits Companion - ERISA Forfeiture Litigation

Williams Mullen on

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

UB Greensfelder LLP

New Developments in 401(k) Plan Forfeiture Lawsuits: Advice for Plan Sponsors

UB Greensfelder LLP on

401(k) plan sponsors are seeing a string of lawsuits challenging their use of forfeitures to offset matching contributions. In the most recent suit, plaintiffs claimed that a 401(k) plan sponsor violated its fiduciary duties...more

Bradley Arant Boult Cummings LLP

How to Prevent a Lawsuit Over Retirement Plan Forfeitures

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

Jackson Lewis P.C.

Conflicting Decisions Foreshadow Upcoming Disputes in ERISA 401(K) Forfeiture Class Actions

Jackson Lewis P.C. on

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

Jackson Lewis P.C.

Use of Plan Forfeitures Not the Slam Dunk It Used to Be

Jackson Lewis P.C. on

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

Jones Day

Another 401(k) Plan Sponsor Faces Novel Suit Regarding its Use of Forfeiture Funds

Jones Day on

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

Verrill

Use of Retirement Plan Forfeitures: The IRS Proposed Regulations, Recent Litigation, and the DOL’s Position

Verrill on

In five recently filed class action lawsuits, 401(k) plan participants allege that plan fiduciaries violated ERISA by using plan forfeitures to offset employer contributions instead of paying plan expenses. The use of...more

Ary Rosenbaum - The Rosenbaum Law Firm P.C.

The forfeiture provision

Again, litigators are trying to create class action lawsuits against large plans. This time, I think they’re scraping the bottom of the barrel....more

Dickinson Wright

Mastering Retirement Plan Forfeitures: A Deep Dive into IRS’s 2023 Proposals & Fiduciary Litigation Trends

Dickinson Wright on

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

Nossaman LLP

Felony Forfeitures Statutes Tested Again: A Tale of Two States’ Pension Reform Statutes–One Forfeiture Survives and One Does Not

Nossaman LLP on

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

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