Benefits & ERISA Law

Wednesday Potpourri

Posted on April 07, 2010
Over the past week or so, several interesting items have crossed my desk, none of which have appeared while I have had time to do them justice with a full blown post. We will do three for Wednesday today - even though there is no alliteration at all to that title, as opposed to five for Friday or twofer Tuesday - and run them down here...

Harris, Hecker, Excessive Fees and Marketplace Discipline

Posted on March 31, 2010
Yesterday, the Supreme Court effectively rejected the idea that mutual fund fees, in the non-ERISA context, are not actionable if consistent with the market as a whole, in response to a Seventh Circuit decision finding that a fund did not pay excessive fees to its investment advisor in light of marketplace discipline (I am oversimplifying the Supreme Court ruling a little bit, as this is not actually a blog on the Investment Company Act of 1940)...

What Daubert Can Teach Us About Electronic Discovery Problems

Posted on March 29, 2010
I have written before, probably on more than one occasion, about the fundamental philosophical problem underlying electronic discovery, which is that lawyers and courts continue to view it through the traditional rubric of discovery, one formed in the world of paper documents, interrogatory answers, and deposition testimony...

Attorneys as Fiduciaries

Posted on March 24, 2010
Are you, or have you ever been, a fiduciary? Sometimes I am tempted to open a deposition with exactly that question, phrased as a derivation of the famous McCarthy era line. While I doubt I ever would do it, it's the million dollar question in most breach of fiduciary duty litigation under ERISA...

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Fees, Me and BrightScope

Posted on March 19, 2010
This is fun - I am quoted in a nice article on BrightScope, which you can find here, reprinted on The Intelligent 401k Advisor blog (you can find the original article on Workforce.com, but you will have to register to get access to it).

When Does Little Recovery Justify a Large Fee Award?

Posted on March 18, 2010
This is a little item about a large award of attorney's fees in an ERISA case to a prevailing plaintiff in a case involving only several hundred dollars in actual recovered damages, but it caught my eye for a couple of reasons. Factually, as the story goes, the court awarded some $45,000 in attorney's fees in a case in which the claimant recovered just over $600, raising the issue of whether the fee award was too disproportionate to the recovery to be justified...

The Fiduciary Status of Investment Advisors

Posted on March 11, 2010
I often explain to people that as a litigator, I am typically presented with a knotty, tied up problem, consisting of all the decisions and plan choices that have been made in the past that eventually resulted in litigation, and that I then have to unravel the knot into its constituent pieces, which can then be used to defend the decisions that led to the knotty problem (if I am defending the case) or to attack the decisions that created the knot (if I am instead representing a plaintiff, whether a plan participant or a plan sponsor or other fiduciary)...

You Say Potato, I Say Potato: Two Different Understandings of What Discretionary Review Means

Posted on March 10, 2010
This is interesting. I have written before on this blog, on numerous occasions, about courts sometimes engaging in a more searching level of discretionary review that, in essence, is not discretionary review at all, at least in the manner it has long been traditionally understood...

On the Ticking Time Bomb of Public Pension Plans

Posted on March 09, 2010
Wow. When I saw this article about the questionable investment assumptions and increasingly risky investment choices being pursued by public pension plans, the first thing that jumped into my head was the old Yogi Berra line that 'in baseball, you don't know nothing...

A Nicely Supported Overview of Global Warming Litigation and its Impact on Insurers

Posted on March 05, 2010
Well now, I think this is exactly what I said in this post here, as well as elsewhere on this blog in the past. Global warming litigation is heating up (pretty funny pun, huh?), litigation costs from the defense of those cases pose a significant threat to the insurance industry, and insurance coverage litigation to sort out coverage for those costs is bound to follow on the heels of such global warming cases...

In re Lehman

Posted on March 03, 2010
I have been wanting to post about the decision early last month in In re Lehman Brothers ERISA Litigation, in which the Southern District of New York dismissed ERISA stock drop claims against a number of officers and a named fiduciary, but, as it turns out, I have been too busy using the decision for my own purposes in my own practice to find time to post about it...

A Parable About the Cable Man

Posted on February 25, 2010
For reasons too obscure and uninteresting to mention, I have had almost nothing to do with the cable tv industry since, well, it was invented. What's a DVR, anyway, and why would I want one? But yesterday, I had to obtain digital cable from my local cable company, and called them, braced to be gouged...

Pozek on 403(b) Plans

Posted on February 22, 2010
I always wondered what benefits whiz Adam Pozek did on Sundays, and now I know - he writes excellent blog posts on 403(b) plans, like this one right here! My own experience with such plans has concerned disputes over them, but Adam provides an interesting overview of the regulatory structure of the 403(b) plan as a whole.

On Plan Fees, Wal-Mart and the Costs of Bad Publicity

Posted on February 18, 2010
Ouch. Here's a story bashing Wal-Mart for having very high plan fees in its 401(k) plan, and wanting to know why in the world it doesn't negotiate lower fees when it has some ten billion dollars in assets to use as leverage. I am sure the plaintiffs' class action bar has the same question...

How Will Climate Change Affect LTD Carriers?

Posted on February 11, 2010
Who knows? The only link between the two subjects that I know of right now is that this blog post is going to touch on both issues. There are a couple of stories I thought I would pass along today that may be worth reading. In the first, here, I am quoted on climate change litigation and the potential costs to the insurance industry...

Ten Ways to Stay Out of Trouble

Posted on February 08, 2010
I talk a lot on these electronic pages about compliance. Its really, from my perspective as a litigator, an ERISA lawyer's take on the old sports saw that the best defense is a good offense. I often say that, in this economy and this investment market, any problems in the operations of a plan will become grist for a lawsuit, including seemingly minor things that participants - and class action lawyers - would have simply ignored in years past while the markets were only going up, even if they suppressed returns slightly...

Disability Insurers, False Claims and Social Security Benefits

Posted on February 02, 2010
Here's a story worth reading, about a case worth paying attention to, namely the pending First Circuit appeal - argued yesterday - concerning whether a long term disability insurer - namely Unum - engages in false claims when it instructs beneficiaries to also apply for Social Security disability benefits...

Climate Change Litigation and Insurance Coverage

Posted on January 27, 2010
I have posted in the past about how everything eventually makes its way through the insurance industry, in terms of any types of new lawsuits or liability theories, and as this article makes clear, litigation over climate change will be no different. The suits are coming, and while their viability is yet to be determined, they will pose challenges for the insurance industry, because the development of theories of liability in this area will eventually lead to demands for insurance carriers to cover the defense costs or liabilities arising from those theories, just as occurred with asbestos and pollution, and almost certainly with the same types of pitched battles over the existence of coverage as occurred in those areas...

On Attorneys Fees and Hecker

Posted on January 26, 2010
Honestly, I have spent a week scratching my head, off and on, over the Supreme Court granting cert to consider the standards governing when attorneys fees can be awarded in an ERISA case, particularly when they denied cert shortly thereafter in Hecker, which presented the opportunity to address the much more substantive issue of the scope of fiduciary responsibility for the amount - and corresponding degree of disclosure - of 401(k) fees...

Here's What the Court Will Do In Conkright v. Frommert

Posted on January 19, 2010
Alright, here we go on Conkright v. Frommert, which will be argued at the Supreme Court on Wednesday. SCOTUS has the full run down of the case and what is at issue right here, and long time ERISA blogger Paul Secunda has an amici brief before the Court on the core issue, which can be found here...

Is There A Disjunct Between Excessive Fee Cases and the Real World?

Posted on January 12, 2010
Here's a very interesting article from the Financial Times on the Deere/Wal-Mart line of 401(k) suits, in which class actions are being brought on behalf of plan participants alleging that fees in the plans at issue were too high and insufficiently disclosed...

BusinessWeek on BrightScope

Posted on January 08, 2010
I have posted frequently on BrightScope and their work in rating 401k plans, and in particular about their decision to rate them in a Zillow like manner that can be quickly understood by employees. Here's a terrific article out of BusinessWeek on the site, and on the people behind it...

Blending De Novo and Deferential Review

Posted on January 07, 2010
I just noticed I haven't posted since last year, for a few weeks to be more accurate, due to the usual end of the year crunch and a briefing schedule in a case overlaid on top of that to boot. No matter the reason, it runs afoul of my general feeling that you shouldn't host a blog if you are not going to post frequently...

Introducing Pozek on Pensions

Posted on December 18, 2009
Speaking of new blogs, I would be remiss as well if I didn't pass along a link to Adam Pozek of Sentinel Benefits' new blog, the wonderfully named Pozek on Pension (I have always been a big fan of alliteration). Adam has always been a font of knowledge on compliance issues and the day to day management and operational challenges of benefit plans, and I am pleased to see he has taken up the opportunity blogging presents to share that knowledge with the rest of us...

A Nice Explanation of the DOL Advisory Opinion on Target-Date Funds

Posted on December 17, 2009
I like this (relatively) new blog here, the Benefits and Employment Observer, by the lawyers at the small - only in numbers - Washington D.C. shop of Bailey & Ehrenberg. This is the cleanest, most easily understood presentation of the findings of the DOL's recent advisory opinion 'addressing the issue of whether the assets of ‘target-date' or ‘lifecycle' mutual funds constitute ‘plan assets' of employee benefit plans which invest in the funds' that I have come across over the couple of weeks since the opinion's issuance.

Does the Bell Toll for Discretionary Clauses?

Posted on December 15, 2009
I have been wondering about the question of whether state insurance commissioners can effectively gut the industry practice of including discretionary clauses in disability policies by refusing to approve forms for use that include them, or whether ERISA preemption precludes that action...

Marx on 401(k) Litigation

Posted on December 14, 2009
I have a stack of substantive ERISA matters that I have been trying to post on for the last week or two, and I am going to try to work through them over the next few weeks. The thing about a blog, though, is the world keeps on spinning, and each day you find something new you want to post on, which keeps shunting those older items further into the background...

Three for Thursday

Posted on December 03, 2009
I am going to catch up on a number of items I have meant to blog on this week, all in one fell swoop. So here goes: • I posted before about my appearance in an article in the Boston Business Journal, but one that was only available on-line to subscribers...

On Fiduciary Liability Insurance

Posted on November 24, 2009
I have written before that one of the things that makes insurance coverage law interesting is the fact that almost every trend in liability or litigation eventually shows back up in insurance disputes, in a sort of fun house mirror sort of way. Whether it is corporate exposure for asbestos liabilities, or the sudden invention of Superfund liability, those liability risks eventually end up in insurance coverage litigation over the question of whether insurers have to cover them...

Me and My Blog

Posted on November 23, 2009
Continuing last Friday's line of digression away from the actual subjects of this blog, I thought I would pass along that I am featured in an article in the current edition of the Boston Business Journal, on the subject of legal blogs. Here's a link to the article, although you need to be a subscriber to access the rest of the article (including the rest of the quotes from me and a smiling picture of my handsome visage)...

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