A U.S. magistrate judge in Chicago has dismissed a claim by a Caterpillar 401(k) participant that the record keeper formerly known as Aon Hewitt and an affiliate violated their fiduciary duties when they subcontracted a financial advice service to Financial Engines.
"The court concludes that Caterpillar had sole authority to select and hire Financial Engines, and it is not plausible on this record that Hewitt had any final authority or control over the selection and hiring of Financial Engines," U.S. Magistrate Judge Jeffrey T. Gilbert wrote in his opinion Monday. "The court is not persuaded by any of (the plaintiff's) arguments in support of her claims that Hewitt is a fiduciary or has a fiduciary duty to her and the plan participants."
Neither Caterpillar nor Financial Engines were cited as defendants in the case of Scott vs. Aon Hewitt Financial Advisors et al. The record keeper is now called Alight Solutions.
The plaintiff, Cheryl Scott, alleged that Aon Hewitt caused participants to pay "excessive fees," which "amounted to improper kickbacks" when the firm subcontracted investment advice services to Financial Engines, according to court documents.
"The court has concluded that Scott has failed to allege facts sufficient to support a claim that Hewitt is a fiduciary of the plan for any purpose, let alone for purposes of facilitating the investment adviser services provided by Financial Engines," Mr. Gilbert wrote.
This was the latest in a series of dismissals by several federal courts of similar complaints alleging ERISA violations by record keepers and their affiliates that subcontracted advice services to Financial Engines. Courts have dismissed complaints against Voya Financial, as well as against Xerox HR Solutions (now Conduent) and two units of Fidelity Investments.