A federal judge in New York has rejected for a second time a lawsuit by former employees of Deloitte LLP who accused the company and its fiduciaries of violating ERISA by charging excessive record-keeping fees for two defined contribution plans.
"Granting leave to amend the (original) complaint would be futile because the defects present in the original complaint continue to exist in the proposed amended complaint," Judge John G. Koeltl wrote July 5 in the case of Singh et al. vs. Deloitte LLP et al. "The proposed amended complaint does not allege new facts curing the original complaint's failure to allege with specificity what recordkeeping services the plan and its comparators received," he wrote.
Noting plaintiffs maintained bigger plans should have lower costs, the judge wrote that the allegation "is not plausible" because they had to show more than a comparison of numbers.
"The plaintiffs do not consider that different plans may offer different services, or that different plans may provide a higher level of service than competing plans," he explained.
The plaintiffs sued in October 2021 seeking class action status. The judge dismissed the original lawsuit in January 2023, giving plaintiffs a chance to amend their complaint.
Because their proposed amended complaint didn't provide sufficient information to address his original comments, the judge denied this second chance, adding that their arguments "are either moot or without merit" and ordering the case closed.
The Deloitte Profit Sharing Plan had $9 billion in assets and the Deloitte 401K Plan had $9.95 billion in assets, both as of Dec. 31, 2021, according to the latest Form 5500s. Both are based in New York.
