A participant in a 401(k) plan offered by NextEra Energy Inc. has filed an ERISA lawsuit claiming that the plan's record-keeping fees are excessive and information about the fees is inadequate.
"Imprudence results in massive financial losses to workers forced to rely on NextEra to prudently administer the plan," said the complaint filed Sept. 25 in a U.S. District Court in West Palm Beach, Fla.
"NextEra must engage in a rigorous process to control fees and ensure that plan participants pay no more than a reasonable level of compensation to the plan's service providers," said the lawsuit, which is seeking class-action status in the case of Stewart vs. NextEra Energy Inc.
The complaint also criticized the plan's offering company stock in the retirement plan, accusing NextEra of a "self-serving and financially motivated decision to dump nearly half of the plan's investments in company stock."
The lawsuit said this policy was a "brazenly imprudent decision," alleging that the "value of NextEra shares have dropped more than 27% over the last two years."
The primary reason for the stock drop was due to allegations of violations of state and federal campaign finance law violations by NextEra's subsidiary, Florida Power & Light, the lawsuit said. The subsidiary announced in January 2023 that CEO Eric Silagy would retire in April 2023.
"NextEra knew, or should have known, that its company's stock price was headed for disaster in late 2021," the lawsuit said. "Nonetheless, from 2021 through even today, NextEra continued aggressively and recklessly investing plan assets into NextEra common stock."
Based on its insider knowledge, "NextEra was duty-bound by ERISA to prevent harm to the plan and its participants from undisclosed information which it knew made its common stock an imprudent investment for retirement purposes," the lawsuit said.
A company representative did not respond to a request for comment.
NextEraEnergy Inc. Employee Retirement Savings Plan, Juno Beach, Fla., had assets of $6.95 billion as of Dec. 31, 2021, according to the latest Form 5500.
