The ERISA Industry Committee, the American Benefits Council and the National Association of Manufacturers have filed a joint brief stating that the lawsuit should be dismissed in appeals court, where the case currently resides.
“This case is ripe,” said Quentin Riegel, the vice president for litigation and deputy general counsel for the National Association of Manufacturers, the trade association that represents more than 11,000 companies in the U.S. “It’s on appeal, so we feel that the time is right to voice our view and reaffirm that this case should be dismissed.”
Last summer, a federal judge granted Deere’s motion to dismiss the case, in which Deere workers alleged that fees in the company’s 401(k) plan were excessive. The suit also named investment manager Fidelity as a defendant, and alleged that both parties breached their fiduciary obligations by providing mutual funds and 401(k) services to participants with unreasonable, and undisclosed, costs attached.
The brief filed by the three employer advocates states that “bald assertions that 401(k) plan fees are ‘too high’ or ‘unreasonable’ can be readily made about any plan,” and references 15 similar 401(k) fee suits that have been filed against large corporations since 2006. In the Deere case, the brief notes, “the plaintiffs’ heavy reliance on boilerplate allegations and the absence of specific allegations strongly suggest that these cases were initiated as fishing expeditions.”
The brief also noted that “although at first blush the complaints might seem likely to contain specific details … their rhetorical flourishes and boilerplate passages merely camouflage the complaints’ utter lack of substance.”
A Deere spokesman was not immediately available to comment on the brief. Fidelity spokeswoman Jenny Engle said the brief supports Fidelity’s position that the district court’s dismissal was the correct ruling in the case.
Jerome Schlichter, the attorney from St. Louis law firm Schlichter Bogard & Denton who is representing the Deere workers, as well as workers at several other companies who are pursuing similar suits over 401(k) fees, could not immediately offer comment on the contents of the brief.
This latest development comes roughly two months after the Department of Labor elected to step in and file its own brief stating that the judge erred in dismissing the Deere case, and requested that the appeals court reverse this decision.