Northwestern University, Cornell University, Columbia University and the University of Southern California are the latest universities to be sued by law firm Schlichter, Bogard & Denton over alleged mismanagement of their defined contribution plans.
The lawsuits were filed separately Wednesday against the four universities in U.S. District Courts in Chicago, New York, and Los Angeles, on behalf of plan participants.
The lawsuits assert the universities breached their fiduciary duties by charging participants excessive fees and investing their assets in high-cost and poor-performing funds.
Schlichter, Bogard & Denton brought similar allegations against the 403(b) plans of New York University, Yale University, Duke University, Johns Hopkins University, University of Pennsylvania, Vanderbilt University, Emory University and Emory Healthcare, and against a 401(k) plan of the Massachusetts Institute of Technology in lawsuits filed earlier this month.
It is the second time this week Columbia's 403(b) management has been called into question. Law firm Sanford Heisler LLP sued the university on Tuesday for “unreasonable” and “greatly excessive” record-keeping, administrative and investment management fees in its 403(b) plans.
As of Dec. 31, 2014, Ithaca, N.Y.-based Cornell offered 299 investment options in its $1.9 billion retirement plan for the employees of the endowed colleges at Ithaca and 301 options in its $1.2 billion tax deferred annuity plan with TIAA-CREF and Fidelity Investments as record keepers, according to the lawsuit.
As of Dec. 31, 2015, Evanston, Ill.-based Northwestern University's $2.3 billion retirement plan had 242 investment options with TIAA and Fidelity as record keepers and its $530 million voluntary savings plan had 187 investment options with TIAA as its record keeper, according to the NU lawsuit. Although the university is moving to a streamlined investment lineup for its defined contribution plans in October, a couple of costly and underperforming investment options have been retained, the lawsuit argues.