DOL backs participants in 401(k) suit

The Department of Labor is backing 401(k) participants in an appeal of the dismissal of a class-action lawsuit filed against Deere & Co. and Fidelity Investments, according to a brief filed by the department.
“The District Court erroneously concluded that the (Labor) secretary’s regulation … is unreasonable in that it continues to hold fiduciaries responsible, and potentially liable, for selecting and maintaining the particular funds offered to plan participants, and shields fiduciaries only from liability for participants’ choices between the various fund options,” the brief said. Calls to the DOL were not returned.
The story was first reported on P&I’s website Wednesday.
A U.S. District Court judge in Madison, Wis., dismissed last June the suit against Moline, Ill.-based Deere and Fidelity. Fidelity is trustee and record keeper for Deere’s $2.5 billion 401(k) plan. Deere employees alleged the plan and Fidelity charged unreasonable fees to participants, but Judge John C. Shabaz ruled that Deere and Fidelity met their fiduciary obligations under ERISA. The appeal is pending. Schlichter, Bogard & Denton, a St. Louis law firm, is representing Deere participants.