A former participant in the Nordstrom Inc. 401(k) Plan, Seattle, sued plan executives alleging breaches of fiduciary duties in the management of the plan that had $2.88 billion in assets as of Dec. 31.
The allegations include offering investment options with "excessive" administrative and record-keeping fees, failing to offer less expensive separate accounts and collective trusts vs. mutual funds, and providing "murky disclosures" about administrative expenses, according to the lawsuit.
"Nordstrom failed to adequately and prudently manage the plan," said the lawsuit filed Nov. 6 in U.S. District Court in Los Angeles. "It allowed unreasonable fees to be incurred by participants (and) it did not act prudently to lower costs."
The suit, filed by Megan McCorvey, a participant in the Nordstrom 401(k) Plan from 2010 to 2015, seeks class-action status.
The defendants "failed to ensure that annual operating fees of the holdings in the plan were reasonable for a plan of its size and failed to take advantage of cost-cutting alternatives that would have been dramatically cheaper," the complaint said.
Representatives from Nordstrom didn't respond to a request for comment. The lawsuit was filed by Solouki Savoy and the Law Offices of Howard Prossnitz.