A federal judge in Green Bay, Wis., has rejected a Prevea Clinic Inc. petition to dismiss a lawsuit by former 401(k) plan participants who alleged ERISA violations due to the plan's record-keeping and administrative fees.
U.S. District Court Judge William C. Griesbach issued his ruling Jan. 22 after accepting a recommendation from a magistrate judge in Nohara et al. vs. Prevea Clinic Inc. et al.
Information provided by the plaintiffs comparing the Prevea fees to other plans' fees "is significant enough that it supports an inference, however slight, that the plan participants did not receive services justifying" the fees that they paid, Griesbach wrote.
Because the fees, "at least at this stage," supported the plaintiffs' claim of a duty-of-prudence violation of ERISA, the judge also accepted their allegation of a duty-to-monitor fiduciaries ERISA violation, too.
Griesbach ruled on the plaintiffs' third amended complaint of a lawsuit that was initially filed in July 2020.
Prevea Clinic, Inc. 401(k) and Retirement Plan, Green Bay, Wis., had $387 million in assets as of Dec. 31, 2022, according to the latest Form 5500.