A federal judge in Detroit has dismissed a lawsuit against DENSO International America Inc. and its 401(k) plan fiduciaries, rebuffing claims by current and former employees that the plan was mismanaged in violation of ERISA.
U.S. District Court Judge Mark Allan Goldsmith on July 28 rejected the plaintiffs' allegations that the plan charged excessive record-keeping fees and failed to offer better and/or cheaper investments than those in the lineup.
"The complaint provides no details regarding the specific types or quality of services that the comparator plans received relative to the DENSO plan," the judge wrote.
"This complaint is plaintiffs' second amended complaint," the judge wrote in the case of England et al. vs. DENSO International America Inc. et al. The original complaint was filed in May 2022, seeking class-action status.
"If plaintiffs had facts to support their allegation that the comparator plans received a similar level and quality of services as the DENSO plan, but for a lower recordkeeping fee, they have had multiple opportunities to present them," the judge wrote.
The judge also dismissed allegations that fiduciaries should have selected a higher share class of one investment option to take advantage of revenue sharing; should have selected lower-price share classes for two other investments; and should have replaced an allegedly underperforming stable value fund.
For the latter, the judge noted that plaintiffs offered only two years of comparative data "for a fund that is supposed to grow for several decades."
This two-year comparison "is insufficient to plausibly plead that the investment should never have been selected, became imprudent over time, or was otherwise unsuitable for the goals of the fund," he added.
As of Dec. 31, 2021, the DENSO Retirement Savings Plan. Southfield, Mich., had $2 billion in assets, according to the company's most recent Form 5500 filing.