Three 401(k) plan participants filed a class-action lawsuit against Quest Diagnostics Inc., Secaucus, N.J., claiming the company breached its fiduciary duties by not adequately reviewing the plan's investment options lineup and offering investment options with high fees.
The lawsuit, filed in U.S. District Court in Newark, N.J., on Tuesday, alleges the company and the plan's administrative and investment committees breached their fiduciary duties under the Employee Retirement Income Security Act of 1974 by failing to "objectively and adequately review the plan's investment portfolio with due care to ensure each investment option was prudent," according to the court filing.
The suit also alleges the plan has maintained certain funds in the plan despite similar funds being available with lower fees and better performance histories.
It is the second lawsuit against Quest Diagnostics in a little more than a month. On June 29, one plan participant filed suit against the company alleging it had violated its fiduciary duties under ERISA by offering Fidelity Investments' active lineup of target-date funds instead of a lower-cost lineup since at least December 2010.
As of Dec. 31, the Profit Sharing Plan of Quest Diagnostics Inc. had $4.6 billion in assets, according to the company's most recent 11-K filing.
Quest spokeswoman Kimberly B. Gorode said in an email that the company cannot comment on pending litigation.
Mark K. Gyandoh, partner at Capozzi Adler, attorney for the plaintiff, declined to comment.