The District Court for the Southern District of Iowa recently dismissed an ERISA putative class action lawsuit challenging 401(k) performance and fees after plan participants failed to identify appropriate benchmarks in their complaint.

The court reinforced the Eighth Circuit’s standards for stating such claims, requiring that the plaintiffs allege facts establishing “a meaningful benchmark for assessing the performance of the challenged funds.” In particular, the court highlighted the Eighth Circuit’s requirement to identify a comparable fund with a materially similar style, structure, and goal. Without any comparable fund, the court had no way to evaluate the plaintiffs’ allegations and, therefore, the complaint could not satisfy the pleading requirement.

This lawsuit is just one of nearly 100 proposed class actions filed in 2020 challenging 401(k) fees. Jackson Lewis continues to monitor the landscape of these cases and their impacts on plan sponsors and fiduciaries.

The case is Matousek v. MidAmerican Energy Co., No. 4:20-cv-00352 (S.D. Iowa July 2, 2021).

Tags: Fee class action
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Photo of Stacey C.S. Cerrone Stacey C.S. Cerrone

Stacey C.S. Cerrone is a principal and office litigation manager of the New Orleans, Louisiana, office of Jackson Lewis P.C. and a core member of the Employee Benefits and the ERISA Complex Litigation practice teams. Her nationwide practice focuses on the defense of…

Stacey C.S. Cerrone is a principal and office litigation manager of the New Orleans, Louisiana, office of Jackson Lewis P.C. and a core member of the Employee Benefits and the ERISA Complex Litigation practice teams. Her nationwide practice focuses on the defense of complex ERISA class actions filed against public and private single employer ERISA plan sponsors and fiduciaries, as well as multi-employer plans and fiduciaries and ERISA plan services providers. Stacey litigates a wide variety of class action claims, including 401(k) fee claims, stock drop claims, “church plan” and “government plan” claims, health and welfare plan claims, and ERISA Section 510 claims. She also litigates ERISA benefit claims and claims involving non-ERISA plans.

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Photo of Alicia M. Chiu Alicia M. Chiu

Alicia M. Chiu is a principal in the Orlando, Florida, office of Jackson Lewis P.C. She devotes the majority of her practice to employment litigation, defending employers in federal and state courts, as well as before the EEOC and other administrative agencies.

Alicia…

Alicia M. Chiu is a principal in the Orlando, Florida, office of Jackson Lewis P.C. She devotes the majority of her practice to employment litigation, defending employers in federal and state courts, as well as before the EEOC and other administrative agencies.

Alicia also provides clients with day-to-day advice and counseling regarding employer policies and various workplace law issues as they arise.

While attending law school, Alicia served as an associate editor of The Ohio State University Journal on Dispute Resolution and graduated in the 10% of her class. She also was a judicial extern to the Honorable Judge Algenon Marbley in the Southern District of Ohio. Following law school, Alicia served as a law clerk to The Honorable Judge Norah McCann King in the Southern District of Ohio.

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