Participants in two New York University 403(b) plans have filed an amended complaint in federal District Court in New York, alleging that plan executives violated their fiduciary duties in the management of the plans.
"A prudent process would have produced a different outcome," the complaint alleged.
The complaint, filed Nov. 13 and seeking class-action status, was a follow-up to an original complaint for which U.S. District Court Judge Katherine B. Forrest dismissed most of the plaintiffs' allegations on Aug. 25, 2017. The plans offered more than 100 investment options, including "duplicative funds in numerous investment styles and higher-cost retail shares," said the complaint in Sacerdote et al. vs. NYU Langone Hospitals et al. Plaintiffs alleged that "identical lower-cost" versions of the same funds were available.
The plaintiffs argued that the plans paid "excessive administrative fees" in part because the plans had an "inefficient multi-record keeper structure."
The record keepers are Vanguard Group Inc. and TIAA-CREF for one of the plans; TIAA-CREF became the sole record keeper of the other plan in late 2012, the complaint said. Neither Vanguard nor TIAA-CREF was named as a defendant.
"There is no reason why" one of the plans consolidated record keepers in late 2012 or why the other plan "has failed to do so" even though both have the same fiduciary committee and the same members on this committee overseeing both plans, the complaint said.
The complaint was filed by the St. Louis law firm Schlichter Bogard & Denton.
