Skip to main content
MENU
Subscribe
  • Sign Up Free
  • LOGIN
  • Subscribe
  • Topics
    • Alternatives
    • Artificial Intelligence
    • Consultants
    • Defined Contribution
    • ESG
    • ETFs
    • Face to Face
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Partner Content
    • Pension Funds
    • Private Equity
    • Real Estate
    • Regulation
    • SECURE 2.0
    • Special Reports
    • Washington
    • White Papers
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • WPS Innovation Awards
    • Influential Women in Institutional Investing 2023
    • Eddy Awards
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • ESG Sustainability - Gaining Momentum
    • ESG Investing | Industry Brief
    • Innovation in ESG Investing
    • 2023 ESG Investing Conference
    • ESG Rated ETFs
    • Divestment Database
  • Defined Contribution
    • Latest DC News
    • The Plan Sponsor's Guide to Retirement Income
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • DC Plan Design: Improving Participant Outcomes
    • 2023 Defined Contribution East Conference
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Research Center
    • The P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
  • Print
Breadcrumb
  1. Home
  2. COURTS
February 27, 2018 12:00 AM

Appeals court orders fiduciary breach case vs. Transamerica to be dismissed

Robert Steyer
  • Tweet
  • Share
  • Share
  • Email
  • More

    A federal appeals court in Pasadena, Calif., ruled for Transamerica Life Insurance Co. and several affiliates against plaintiffs who alleged Transamerica violated fiduciary duties as a service provider.

    In a complex case that dates back to 2011, the three-judge appeals court panel reversed a ruling by a U.S. District Court judge in Los Angeles that had supported the plaintiffs.

    The lower court had refused most of Transamerica's request that the case be dismissed. Transamerica attorneys had argued that the defendants weren't fiduciaries under the terms of the Employee Retirement Income Security Act.

    On Feb. 23, the 9th U.S. Circuit Court of Appeals reversed the lower court judge's ruling on the motion to dismiss, vacated the judge's granting of class-action status to plaintiffs and told the judge to dismiss the case.

    "We simply conclude that when a service provider's definitely calculable and non-discretionary compensation is clearly set forth in a contract with a fiduciary employer, collection of fees out of plan funds in strict adherence to that contractual term is not a breach of a provider's fiduciary duty," said the panel's unanimous opinion by Circuit Judge Andrew D. Hurwitz.

    Plaintiffs filed a nine-count complaint against Transamerica, and District Court Judge Dean D. Pregerson dismissed only two​ of the complaints in 2013.

    In 2016, Mr. Pregerson ruled against Transamerica's request to reconsider his decision in the case of Santomenno et al. vs. Transamerica Life Insurance Co. et al. The complaint was filed by current or former participants in two 401(k) plans — QualCare Alliance Networks Inc. Retirement Plan and Gain Capital Group LLC 401(k) Plan. Neither plan was cited as a defendant.

    Plaintiffs argued that Transamerica had violated its fiduciary duties by offering certain investment options by Transamerica affiliates in a group annuity contract.

    They also alleged that Transamerica failed to invest in the lowest-price shares, retained certain money from revenue sharing rather than distributing the amounts to participants and charged additional fees on top of investment management fees, according to court records.

    Transamerica maintained that it wasn't a fiduciary regarding the terms of its own compensation.

    The appeals court agreed, noting that three other federal appeals courts "have held that a plan administrator is not an ERISA fiduciary when negotiating its compensation with a prospective customer."

    Related Articles
    Transamerica settles 401(k) excessive-fee lawsuit with its employees for $3.8 m…
    Judge dismisses 2 claims in Verizon 401(k) lawsuit, allows one to proceed
    J.P. Morgan settles lawsuit on alleged fiduciary breach in stable value funds
    Judge dismisses fiduciary-breach lawsuit against Delta Air Lines
    Appeals court upholds dismissal of lawsuit against Hewlett-Packard 401(k) plan …
    More 401(k) plans moving from revenue-sharing model
    SunTrust Banks, 401(k) participants settle fiduciary-breach lawsuit
    Lowe's, Aon Hewitt sued for fiduciary breach over 401(k) losses in Hewitt Growt…
    Recommended for You
    Nicolai Tangen
    NBIM joins AP7 as co-lead plaintiff in SVB lawsuit
    tyson_plant_center_texas_1550-main_i.jpg
    Tyson Foods sued over 401(k) fees, record keeper
    Sprint_Store_i.jpg
    Sprint dials up $3.5 million to settle pension plan lawsuit
    Private Markets: A Thriving Space
    Sponsored Content: Private Markets: A Thriving Space
    Sponsored
    White Papers
    A Guide to Home Equity Investments: The Untapped Real Estate Asset Class
    Modernize your K-12 retirement plan with vendor consolidation
    Q4 2023 Credit Outlook: Price Is What You Pay, Value Is What You Get
    There's More Than One Way to Be a Climate Investor
    Exploring the Commercial Application of Artificial Intelligence
    Private Credit Insights: Every Problem Is an Opportunity in Disguise
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    October 23, 2023 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Custom Content
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Artificial Intelligence
      • Consultants
      • Defined Contribution
      • ESG
      • ETFs
      • Face to Face
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Partner Content
      • Pension Funds
      • Private Equity
      • Real Estate
      • Regulation
      • SECURE 2.0
      • Special Reports
      • Washington
      • White Papers
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • WPS Innovation Awards
      • Influential Women in Institutional Investing 2023
      • Eddy Awards
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • ESG Sustainability - Gaining Momentum
      • ESG Investing | Industry Brief
      • Innovation in ESG Investing
      • 2023 ESG Investing Conference
      • ESG Rated ETFs
      • Divestment Database
    • Defined Contribution
      • Latest DC News
      • The Plan Sponsor's Guide to Retirement Income
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • DC Plan Design: Improving Participant Outcomes
      • 2023 Defined Contribution East Conference
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Research Center
      • The P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
    • Careers
    • Events
      • View All Conferences
      • View All Webinars
    • Print