Former participants in a 403(b) plan run by the Wake Forest University Baptist Medical Center sued the facility and plan fiduciaries alleging a series of ERISA violations relating to fees and plan investment management.
The defendants failed to control administrative and record-keeping costs and retained certain investment options that cost more than "identical or similar" options, said the complaint filed June 4 in U.S. District Court in Winston-Salem, N.C.
"Many of the plan's mutual funds had investment management fees in excess of fees for funds in similarly-sized plans," said the complaint in the case of Garnick et al. vs. Wake Forest University Baptist Medical Center et al. The plaintiffs are seeking class-action status.
"Many of the plan's primary mutual funds were not in the lowest share class available to the plan," the complaint said. "Defendants knew or should have known of the existence of cheaper share classes and therefore should have immediately identified the prudence of transferring the plan's funds to these alternative investments."
Representatives of the medical center did not respond to a request for comment.
The Wake Forest University Baptist Medical Center 403(b) Retirement Savings Plan, Winston-Salem, N.C., had $2.31 billion in assets as of Dec. 31, 2019, according to the latest Form 5500.