A pair of former employees of the Trader Joe's grocery store chain have sued the company alleging breaches of fiduciary duty in the management of the company's 401(k) plan.
The former employees accused the company and its retirement plan managers of choosing "inappropriate higher cost mutual fund share classes" and failing to take advantage of the plan's size — $1.63 billion in assets by year-end 2018 — to negotiate lower fees.
The company paid "unreasonable and excessive fees for record keeping and other administrative services,' said the lawsuit, Marks and Bowling vs. Trader Joe's Co., filed Dec. 30 in a U.S. District Court in Los Angeles. Plaintiffs are seeking class-action status.
The plaintiffs also contended that the company "failed to seek competitive bids" for record keeping for the Trader Joe's Company Retirement Plan.
A representative for the company, based in Monrovia, Calif., could not be reached for comment.
