Former employees of Cobham Advanced Electronic Solutions have sued the company and its 401(k) plan fiduciaries alleging ERISA violations related to fees and investment selection.
They accused the defendants of "failing to objectively and adequately review the plan's investment portfolio with due care to ensure that each investment option was prudent, in terms of cost" according to the lawsuit filed July 28 in a U.S. District Court in San Jose, Calif.
They also criticized defendants for "maintaining certain funds in the plan despite the availability of identical or similar investment options with lower costs and/or better performance histories," said the complaint in Langston et al. vs. Cobham Advanced Electronics Solutions Inc. et al. The plaintiffs are seeking class-action status.
The complaint criticized the cost and performance of a target-date series and two stand-alone investments from different asset managers. Defendants "did not engage in a prudent process in evaluating investment management fees and the prudence of the plan's funds," the lawsuit said.
A company representative did not respond to a request for comment.
Cobham United States 401K Plan, San Jose, Calif., had $970 million in assets as of Dec. 31, 2021, according to the latest Form 5500.