In a recent decision that merits attention from legal professionals working in corporations and law firms, the U.S. Court of Appeals for the Tenth Circuit delivered its judgment in the case of Matney v. Barrick Gold of North America, et al. on September 6, 2023. The crux of the verdict revolved around high-cost funds and high recordkeeping fees in employer-sponsored defined contribution retirement plans.
In its decision, the Tenth Circuit maintained that participants in an employer-sponsored defined contribution retirement plan cannot state a claim for breach of the duty of prudence vis-à-vis high-cost funds or high recordkeeping fees. However, this can only be applicable absent allegations about suitable benchmark funds and recordkeeping fees of suitable benchmark plans.
This ruling is significant as it sets a precedent that might influence future legal actions associated with retirement plans. It suggests that for a claim to succeed, there needs to be comparison data available from suitable benchmark funds and plans. Absent this, breach-of-duty claims related to high-cost funds and recordkeeping fees lack legal grounds.
Reference: For in-depth details on the case and its implications, please refer to the full document here.