Washington, D.C. counsel Brad Campbell was quoted in an article in Pensions & Investments titled, “Fiduciary Breach Issue Gets Supreme Court Hearing.”
The U.S. Supreme Court is scheduled to hear arguments next month in an ERISA case that could affect the fiduciary duty to monitor plan investments. In the case of Tibble et al vs. Edison International et al, the court is being asked to decide how to apply an ERISA statute that limits fiduciary breach lawsuits to a six-year period.
Brad, a former DOL assistant secretary for the Employee Benefits Security Administration said, “The core issue is: What is the scope of the ongoing duty to monitor? The ERISA remedies are fairly narrow and constrained. Congress put this (six-year) statute in for a purpose.”
Brad, who isn't involved in the Tibble case, disagreed with the Labor Department's arguments. He said the Supreme Court might take three possible approaches: endorse the position that the six-year period starts when the plan chooses an investment option, thus supporting Edison; accept arguments by the plaintiffs and the Labor Department that the six-year limit in ERISA “periodically refreshes, meaning there's basically no limit” because this period could be re-set based on alleged fiduciary breaches; or reach some middle ground in which the six-year limit is retained, but the clock could be restarted if there were some material change in the plan.
“This middle ground would be a difficult standard to articulate,” he said.
To read the entire article, click here.