A former participant in a 401(k) plan offered by Advance Publications has sued the privately held media company and plan fiduciaries, alleging that retaining a BlackRock target-date series violated ERISA due to poor performance when compared to target-date series from several other providers.
The Wednesday complaint, filed in a U.S. District Court in New York, is the 10th ERISA lawsuit since late July filed against a sponsor offering the BlackRock LifePath Index funds.
The Advance Publications lawsuit makes the same argument as the other nine lawsuits using the same sets of comparative data. Miller Shah LLP has been the lead attorney or co-counsel in each lawsuit.
BlackRock is not a defendant.
"Our investment process takes into account multiple factors, including return objectives, market cycles, time horizon, and risk management," a BlackRock spokeswoman wrote in a Friday email, providing the same response as in the other lawsuits.
"BlackRock's LifePath Index funds are highly regarded by many fiduciary decision-makers and independent evaluators of investment products for delivering consistently strong outcomes for plan participants over time," the spokeswoman wrote.
The lawsuit, which seeks class-action status, said former and/or current participants since Aug. 10, 2016, are affected by the allegations.
"Defendants selected, retained, and/or otherwise ratified poorly-performing investments instead of offering more prudent alternative investments that were readily available at the time defendants selected and retained the funds at issue and throughout the class period," the lawsuit said. "Since defendants have discretion to select the investments made available to participants, defendants' breaches are the direct cause of the losses alleged herein."
The plaintiff argued that the defendants "neglected to undertake any analysis of the BlackRock TDFs against appropriate peers using the above or other important performance metrics," the lawsuit said. "If defendants had taken their fiduciary duties seriously during the class period, they would have replaced the BlackRock TDFs with a suitable alternative TDF."
The Advance 401(k) Plan, New York, had assets of $1.5 billion as of Dec. 31, 2020, according to the latest Form 5500. A representative of Advance Publications did not respond to a request for comment.
