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
June 10, 2019 01:00 AM

Intel ERISA 401(k) breach appeal moving to Supreme Court

Robert Steyer
  • Tweet
  • Share
  • Share
  • Email
  • More
    Getty Images/iStockphoto

    The U.S. Supreme Court said Monday it would review an ERISA breach lawsuit covering defined contribution sponsors' responsibilities for communicating investment lineup features and participants' responsibilities for understanding plan options.

    The petition to the court was filed in February by managers of the Intel Corp. 401(k) plan and other Intel organizations, seeking to overturn a ruling by the 9th U.S. Circuit Court of Appeals that held the sponsor liable for fiduciary breaches alleged by a plan participant.

    Intel argued that the participant had received sufficient information about alternative investment options in the plan. Intel said the participant's lawsuit was filed beyond the three-year limitations period allowed by ERISA from the time a plaintiff had "actual knowledge of a breach or violation."

    Intel told the court that the plaintiff "chose not to read or could not recall having read the information," in the case of Intel Corp. Investment Policy Committee et al. vs. Sulyma.

    The participant, Christopher Sulyma, sued in October 2015, but a U.S. magistrate judge issued a summary judgment in March 2017 supporting Intel's contention that he missed the ERISA deadline and that Intel had provided sufficient information.

    However, a three-judge panel of the 9th Circuit reversed and remanded the decision in November, saying Mr. Sulyma lacked sufficient knowledge of the investments based on ERISA standards.

    "If Sulyma in fact never looked at the documents Intel provided, he cannot have had 'actual knowledge of the breach' because he cannot have been aware that imprudent investments were made and that other Intel fiduciaries were failing to monitor or remedy that imprudence," the appeals court wrote. "Because there was a dispute of material fact over Sulyma's actual knowledge, the district court erred by entering summary judgment in favor of Intel on these claims."

    Intel's petition to the Supreme Court said the 9th Circuit Court of Appeals decision conflicts with a 2010 opinion by the 6th U.S. Circuit Court of Appeals in a similar case involving the ERISA limitations standard. Given this so-called circuit split, Intel encouraged the Supreme Court to settle the dispute among appellate courts.

    The Intel case is the second large defined contribution case that the Supreme Court will hear during the next term, which starts in October.

    On June 3, the court agreed to revisit its unanimous decision issued in 2014 ruling that established guidelines for lower courts to determine if stock-drop lawsuits should be dismissed or allowed to go to trial.

    The 2014 ruling, Fifth Third Bancorp et al. vs. Dudenhoeffer et al., and a follow-up 2016 ruling in Harris vs. Amgen, had established a high bar for plaintiffs to claim fiduciary breaches in sponsors' offering company stock in 401(k) plans.

    However, a New York federal appeals court in December ruled against International Business Machines and its 401(k) plan, saying an ERISA complaint by a plan participant met the standards established by the Supreme Court.

    In overruling a pro-IBM decision by a federal district court, the appeals court said IBM's fiduciaries should have protected their retirement accounts when the company's stock fell after IBM's efforts to sell its microelectronics unit in 2014.

    IBM asked the Supreme Court in March 2019 to review this ruling, alleging that the appeals court's decision "reopens the door to lawyer-driven class actions that spring up after every stock drop," according to the petition in Retirement Plans Committee et al. vs. Larry W. Jander et al.

    The Supreme Court also may hear another defined contribution case, Putnam Investments LLC et al. vs. Brotherston et al., in the next term. Putnam filed a petition with the court Jan. 11, asking it to overturn an appeals court ruling against its 401(k) plan. Putnam said the Supreme Court should settle a disagreement among several appeals courts on the issue of loss causation. The dispute focuses on whether plaintiffs must prove an ERISA breach caused a loss, or whether sponsors must disprove an alleged loss was caused by the ERISA breach. The Supreme Court on April 22 asked the U.S. solicitor general to present views on this case.

    Related Articles
    Intel asks U.S. Supreme Court to rule on ERISA breach case
    High court asked to revisit company stock fiduciary case
    More turning to Supreme Court for ERISA relief
    Supreme Court to hear IBM stock-drop fiduciary challenge
    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
    Sustainability Strategies: Evolving Perspectives
    Sponsored Content: Sustainability Strategies: Evolving Perspectives
    Sponsored
    White Papers
    What a Fed pivot and ‘higher for longer’ mean for emerging markets
    A Guide to Home Equity Investments: The Untapped Real Estate Asset Class
    How to Modernize a School District Retirement Plan
    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
    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