Former participants in a 401(k) plan offered by Nextep Inc., Norman, Okla., sued the company and its fiduciaries for alleged violations of their duties under ERISA.
"Defendants ... did not try to reduce the plan's expenses or exercise appropriate judgment to scrutinize each investment option that was offered in the plan to ensure it was prudent," said a complaint filed March 10 in U.S. District Court in Oklahoma City.
The complaint also said that the defendants didn't control administrative record-keeping expenses and that they kept certain investment options in the plan "despite the availability of identical or similar investment options with lower costs and/or better performance histories."
The plaintiffs acknowledged that it "appears" last year that "some changes were made to the plan" in which certain investments cited in the lawsuit were converted to lower-cost shares or "eliminated unnecessary fees," the complaint said.
They argued, however, that the changes were "far too little and too late" because the complaint covers the period starting March 10, 2015 when the alleged ERISA violations began. They are seeking class-action status in the case of Loomis et al. vs. Nextep Inc. et al.
Nextep is a professional employer organization, the complaint said. The Nextep 401(k) Retirement Savings Plan is a multiple employer plan, which had assets of $283.1 million as of Dec. 31, 2019, according to the latest Form 5500.
A company representative did not respond to a request for comment.