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Supreme Court declines to revisit excessive fee challenge by church plan participants

The U.S. Supreme Court declined Monday to review an excessive fee case brought by plan participants against the Evangelical Lutheran Church in America pension board, now known as Portico Benefit Services.

Evangelical Lutheran pastors David Bacon and Timothy Hepner and two others brought a class-action lawsuit in Minnesota state court against the board, alleging violations of the Uniform Prudent Investor Act, including breach of fiduciary duty, breach of trust, fraud and concealment. A Minnesota district court granted Portico’s motion to dismiss the case, but after the plaintiffs appealed, the Minnesota Court of Appeals reversed and remanded the case on July 25. Portico then petitioned the Supreme Court.

In an amicus brief, the Church Alliance argued that a court’s review of the reasonableness of a particular denomination’s retirement plan investments and related fees “would entangle the court in religious questions in violation of the First Amendment.”

Separately, the U.S. Supreme Court will hear arguments March 27 in three consolidated cases seeking to overturn lower-court rulings that church-affiliated defined benefit plan sponsors must be covered by the Employee Retirement Income Security Act. The cases were brought by plan sponsors Dignity Health, Advocate Health Care and Saint Peter’s Healthcare, and are unrelated the Portico excessive fee case.