The U.S. Supreme Court on Monday announced without comment it had declined to hear a long-running complex ERISA case involving ABB Inc., Cary, N.C., and participants in two ABB 401(k) plans.
In the latest incarnation of litigation that started in 2006, the Supreme Court denied a petition to review a request by ABB based on a ruling by the 8th Circuit Court of Appeals in St. Louis on March 9, 2017.
In that ruling, the appeals court vacated and remanded a decision by a U.S. District Court in Jefferson City, Mo. The appeals court said the district judge had mistakenly ruled for ABB regarding potential damages to participants when the ABB plans mapped one investment option to another and how revenue sharing is administered in defined contribution plans.
Although District Judge Nanette Laughrey ruled that ABB plan executives had "abused their discretion" in mapping the funds, she ultimately supported ABB. She wrote in a July 2015 opinion that participants "failed to prove damages consistent with the method of damage calculation" as previously recommended by the 8th Circuit.
"The District Court should have decided for itself how to measure what the plans lost as a result" of the mapping of investment options, the appeals court judges wrote in March.
The case remains before Ms. Laughrey, who recently ordered attorneys for ABB and the participants to submit methodologies for calculating damages to the participants, said Jerome Schlichter, the lead attorney for the participants, in an interview. He is the founding and managing partner of the law firm Schlichter, Bogard & Denton.
Mr. Schlichter said his firm and lawyers for ABB submitted their documents to the judge last week. The District Court case had continued even though ABB had filed a petition with the U.S. Supreme Court in August.
ABB had asked the Supreme Court to review the appeals court ruling in the case, ABB Inc. et al. vs. Tussey et al. The appeals court ruling also "will increase the costs and administrative complexity of offering defined contribution plans," the ABB petition said.
The ABB argument to the Supreme Court "didn't have merit," said Mr. Schlichter. "They were wrong on the law." Representatives from ABB didn't respond to email requests for comment.
