A Massachusetts district court recently ordered defendants in an ERISA fiduciary breach case to produce certain communications with their in-house and outside counsel, rejecting defendants’ argument that the communications occurred in the context of attorneys advising a 401(k) plan’s sponsor and fiduciaries as to their potential fiduciary liability. In re GE ERISA Litig., 2022 U.S. Dist. LEXIS 16586 (D. Mass. Jan. 26, 2022).

The parties’ discovery dispute arose in one of the many class action lawsuits pending against 401(k) plan sponsors and fiduciaries concerning the management of their 401(k) plans. During the course of discovery, defendants withheld communications with their attorneys regarding their 401(k) plan’s investment policy, investment directives, and fiduciary committee charters on the basis of attorney-client privilege. Plaintiffs moved to compel production, arguing that the documents were not privileged due to the fiduciary exception to the attorney-client privilege. Under that doctrine, courts have held that legal advice to plan fiduciaries about plan administration is not protected by attorney-client privilege because such advice is given to the plan fiduciaries on behalf of and for the benefit of the plan participants, thus it is not proper to shield such communications from participant view.

Defendants argued that the communications fell into one of the exceptions to the fiduciary exception, wherein attorney-client privilege re-attaches to communications if the legal advice relates to the plan fiduciaries’ personal liability. In particular, defendants argued that attorneys reviewed plan documents, like investment policies and charters, to advise the fiduciaries on the risk of fiduciary liability given the increasing frequency of 401(k) litigation against employers.

The district court ordered the communications to be produced and differentiated between attorney review based on pending or anticipated litigation, which is privileged, and review based on “a general fear of liability,” which is not privileged. The court was “not persuaded that the prevalence of other 401(k) litigation during the relevant time period is a specific enough litigation risk” to trigger the protection of attorney-client privilege because “guarding against a generalized risk of litigation is a fiduciary duty and does not create a divergence between the interests of the fiduciaries and Plan beneficiaries,” and allowing a fiduciary to fall back on the excuse would cause the fiduciary exception to “cease to function as intended.”

 

 

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Photo of Lindsey H. Chopin Lindsey H. Chopin

Lindsey H. Chopin is a principal in the New Orleans, Louisiana, office of Jackson Lewis P.C. and a member of the firm’s ERISA Complex Class Action, Employee Benefits and Class Action groups.

Lindsey focuses her practice on the defense of complex ERISA class-actions…

Lindsey H. Chopin is a principal in the New Orleans, Louisiana, office of Jackson Lewis P.C. and a member of the firm’s ERISA Complex Class Action, Employee Benefits and Class Action groups.

Lindsey focuses her practice 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. She has litigated a wide variety of class action claims, including 401(k) fee claims, stock drop claims, defined benefit mortality assumption claims, “church plan” and “government plan” claims, health and welfare plan claims, and ERISA Section 510 claims. Lindsey also litigates ERISA benefit claims and claims involving non-ERISA plans.

Lindsey is the author of several ERISA-related articles, including an article focusing on ERISA fee litigation that appeared in the Benefits Law Journal, and is a frequent speaker on ERISA and class action litigation issues, including e-discovery best practices and ethics and professionalism when using social media in litigation. She is a senior editor of Chapter 15 of Bloomberg BNA’s Employee Benefits Law treatise and a contributing author to the ERISA Fiduciary Answers Book and Chapter 39 of the sixth edition of Bloomberg BNA’s ERISA Litigation treatise published in November 2017.

Prior to joining Jackson Lewis, Lindsey practiced complex ERISA litigation for five years at a large, national firm and served as a one-year term clerk for the Honorable Carl J. Barbier in the United States District Court for the Eastern District of Louisiana.

While attending Loyola University School of Law, Lindsey was the articles and symposium editor of the Loyola Law Review and received the “Best Casenote Award” for her casenote analyzing the impact of Kasten v. St. Gobain Performance Plastics Corp., 563 U.S. 1 (2011), an FLSA matter decided by the U.S. Supreme Court.

Prior to attending law school and practicing law, Lindsey was a teachNOLA fellow and taught high school French in New Orleans’ public schools.

Sojung Jeong

Sojung (“Bridget”) Jeong is an associate in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. and a member of the firm’s ERISA Complex Litigation and International Employment groups.

Bridget defends employers in state and federal courts, in class action or single…

Sojung (“Bridget”) Jeong is an associate in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. and a member of the firm’s ERISA Complex Litigation and International Employment groups.

Bridget defends employers in state and federal courts, in class action or single plaintiff matters, involving claims for wage and hour violations, breach of contract, discrimination, harassment, retaliation, wrongful termination, and unfair competition. Bridget maintains an active ERISA litigation docket defending single plaintiff benefit claims and class action breach of fiduciary duty matters. She is litigating the latest wave of ERISA fee class actions and is now involved in motion practice, class certification battles, and discovery issues.

Bridget further provides advice and counseling on international employment law matters, including advising international clients on U.S. labor and employment law and advising U.S. employers on international vaccination policies.

While attending law school, Bridget was Managing Editor of the Texas International Law Journal and participated in the Philip C. Jessup International Law Moot Court Competition.

Prior to joining the firm, Bridget clerked for the Honorable Carmen Messano, New Jersey Superior Court, Appellate Division.