Retirement Security Law Commons^™

Esg Investing Breaches Erisa Fiduciary Duties? A Closer Look At Spence V. American Airlines, Inc., Eric Chin-Ru Chang

Seattle University Law Review

In Spence v. American Airlines, Inc., the U.S. District Court for the Northern District of Texas found that American Airlines breached its fiduciary duties due to BlackRock’s ESG investing practices. Contrary to some reports suggesting that the ruling prohibits ESG investing under ERISA, a closer look at the ruling shows that the court only targeted American Airlines’ failure to manage conflicts of interest appropriately, rather than the legality of ESG investing itself. In light of the intensifying ESG backlash in the United States, this Article cautions against further restrictive measures on ESG investing. Such measures would exacerbate the widening …

Benefits Transparency, Samantha Prince

Faculty Scholarly Works

Recently, several states and cities have enacted equal pay laws in a push for pay transparency in job postings to inform and help reduce wage gaps. Some of these laws also require a description of the employee benefits that the company offers. However, none of these laws require a detailed description of said benefits, even though employee benefits on average make up 24% of an employee’s compensation.

Businesses can choose how much to disclose with respect to their benefits and they may even engage in what this author calls “benefits washing”—a practice where companies provide vague or misleading information about …

The Next Frontier In Plan Fee Litigation: Health Plan Fees, Kathryn L. Moore

Law Faculty Books and Chapters

On September 11, 2006, Jerry Schlichter, a personal injury lawyer from Saint Louis, Missouri, filed some of the first lawsuits claiming that excessive fees in 401(k) plans violated ERISA’s fiduciary standards. Since then, hundreds of suits have been filed challenging retirement plan fees, and the Supreme Court has rendered two decisions in cases claiming that excessive 401(k) plan fees violated ERISA’s fiduciary standards. Since the Supreme Court issued the second decision in 2022, retirement plan excessive fee litigation may have begun to slow. There may, however, be a new frontier in plan fee litigation: health care plan fees.

This article …

Hughes V. Northwestern University, Nicole S. Roth

Tennessee Law Review

No abstract provided.

The Venue Shuffle: Forum Selection Clauses & Erisa, Christine P. Bartholomew, James A. Wooten

Journal Articles

Forum selection clauses are ubiquitous. Historically, the judiciary was hostile to contracts limiting a plaintiff’s venue options. The tide has since turned. Today, lower courts routinely enforce such clauses. This Article challenges this reflexive response in the special context of ERISA cases. It mines ERISA’s statutory text, rich legislative history, and historical context to supply an in-depth exploration of ERISA’s unique policy goal of providing employees “ready access to the Federal courts.” The Article then explains how forum selection clauses undermine this goal and thus should be invalid under controlling Supreme Court jurisprudence.

Energy Re-Investment, Hari M. Osofsky, Jacqueline Peel, Brett H. Mcdonnell, Anita Foerster

Indiana Law Journal

Despite worsening climate change threats, investment in energy—in the United States and globally—is dominated by fossil fuels. This Article provides a novel analysis of two pathways in corporate and securities law that together have the potential to shift patterns of energy investment.

The first pathway targets current investments and corporate decision-making. It includes efforts to influence investors to divest from owning shares in fossil fuel companies and to influence companies to address climate change risks in their internal decision-making processes. This pathway has received increasing attention, especially in light of the Paris Agreement and the Trump Administration’s decision to withdraw …

How Special Is The Special Timing Rule? Analyzing The Timing Of Fica Taxation In Nonqualified Deferred Compensation Plans, Alan J. Ponce

Georgia State University Law Review

Many employers offer nonqualified deferred compensation plans as a benefit to select employees, and those plans allow the employees to prepare for retirement in a tax-efficient manner. For employers,designing and administering such plans in compliance with federal law represents a paramount concern in order to achieve the tax advantages such plans entail. However, for these employers, there remains an inherent ambiguity in the tax code regarding how and when employers should withhold Federal Insurance Contribution Act (FICA) taxes—that is, Social Security and Medicare taxes—on deferred compensation in nonqualified retirement plans.

Tax regulations provide two distinct methods for withholding FICA taxes …

The Other Securities Regulator: A Case Study In Regulatory Damage, Anita K. Krug

Articles

Although the Securities and Exchange Commission is the primary securities regulator in the United States, the Department of Labor also engages in securities regulation. It does so by virtue of its authority to administer the Employee Retirement Income Security Act (ERISA), the statute that governs the investment of retirement assets. In 2016, the DOL used its securities regulatory authority to adopt a rule that, for the first time, designates securities brokers who provide investment advice to retirement investors as fiduciaries subject to ERISA's stringent transaction prohibitions. The new rule's objective is salutary, to be sure. However this Article shows that, …

Surviving The Storm 2016: Employee Benefit Compliance & Employment Law Update, George Thompson, Brooks R. Magratten, Mark A. Pogue, Kelli Viera, Cecily Banks, Roger Williams University School Of Law

School of Law Conferences, Lectures & Events

No abstract provided.

Labor And Employment Law At The 2014-2015 Supreme Court: The Court Devotes Ten Percent Of Its Docket To Statutory Interpretation In Employment Cases, But Rejects The Argument That What Employment Law Really Needs Is More Administrative Law, Scott A. Moss

Publications

No abstract provided.

The Collective Fiduciary, Lauren R. Roth

Scholarly Works

Can fiduciaries be made to serve public goals? The movement under the Patient Protection and Affordable Care Act (“ACA”) towards universal access to health insurance requires us to focus on the fiduciary relationships between large organizations providing access to healthcare and the populations they serve. These relationships have become a collective undertaking instead of a direct, personal relationship.

In this Article, I introduce the concept of the collective fiduciary in response to the shift towards uniform, national goals in the realm of health insurance and healthcare. Only through a collective approach can we hold fiduciaries accountable for the welfare of …

Illusory Rights Under The Arbitrary And Capricious Standard: Adding Remedial Safeguards To The Judicial Standard Of Review Beyond Erisa Denial Of Benefits Claims, Javier J. Diaz

Seton Hall Circuit Review

No abstract provided.

Anti-Fraud Provisions Of The Securities Act; Erisa; Pension Plans; Section 17(A) Private Right Of Action; Daniel V. International Brotherhood Of Teamsters, Marlene P. Emery, Barbara M. Heinzerling

Akron Law Review

In Daniel v. International Brotherhood of Teamsters the Seventh Circuit Court of Appeals held that the federal securities laws apply to disclosure of information regarding employee pension and profit sharing plans. In an era when disclosure of information has become mandatory and commonplace, it is not surprising that relevant information on pension plans should be disclosed to employees. The important aspect of this case is that disclosure was required under the anti-fraud provisions of the federal securities laws, rather than under the provisions of the Employee Retirement Income Security Act (ERISA). Questions concerning the Securities and Exchange Commission's jurisdiction over …

Securities Laws Implications For Savings Associations Acting As Trustees For Ira's And Keoghs

Akron Law Review

This article will focus on the major problem area which has resulted from the above legislation. That problem is whether or not a savings association must register with the Securities and Exchange Commission (SEC) pursuant to the Securities Act of 1931 or the Investment Company Act of 1940, as a consequence of acting as trustee for an IRA or Keogh plan.

Disqualitifcation Of Employee Retirement Plans: The Wrong Remedy, William J. Rands

Akron Law Review

Yet Congress failed to extirpate from the tax laws the sanction of disqualifying an employee retirement plan. Not only has disqualification been described as being "draconian" and "harsh," but it has also been noted that it results in "tragedy," "penalizes the covered employees who have no part in the wrongdoing,"6 and frustrates the legislative purpose of encouraging the establishment and maintenance of employee retirement plans. The imposition of this sanction is nonsensical: the tax consequences devastate the financial security of employees whose future depends on the retirement income they will receive from their employers' plans. This article will discuss this …

Post-Norris Ambiguities: Unanswered Questions For Women And The Pension Industry, T. Timothy Ryan Jr., Paula A. Rock

Akron Law Review

On April 25, 1978, the United States Supreme Court decided Los Angeles Department of Water and Power v. Manhart in a way that was bound to have a profound effect on the pension industry. The division of opinion in the Manhart Court was indicative of the difficulty of the question presented. In Part I, this article examines the Court's findings in Manhart, as well as its conclusions in a more recent case, Arizona Governing Committee v. Norris, in which the Supreme Court extended its Manhart holding in a way bound to have an equally significant impact on pension …

Retiree Welfare Benefits: Erisa, Lmra And The Federal Common Law, Frances Figetakis

Akron Law Review

Part I of this comment will examine the applicable statutory law in this area. Part II will examine the developing body of federal case law. Part III will address the underlying policy concerns in conjunction with already established precedent to provide insight into what the law in this area should be.

Overvaluing Employer-Sponsored Health Insurance, Lauren R. Roth

Scholarly Works

Although positive and negative assessments of tying health insurance to employment abound, most scholars and policymakers have acknowledged that our long history in this area predicts our future. What they have largely ignored, however, is the extent to which individual attachment to employment-based insurance is at the root of our inability to make broader health reforms. The attachment (1) harms exchange-based insurance and (2) denies employers the ability to use Health Reimbursement Arrangements (“HRAs”) to subsidize the purchase of insurance by their employees on the exchanges.

This Article advocates reducing or eliminating workers’ overvaluation of their health insurance and increasing …

A Failure To Supervise: How The Bureaucracy And The Courts Abandoned Their Intended Roles Under Erisa, Lauren R. Roth

Pace Law Review

This Article addresses how courts failed to adequately supervise employers administering pension plans before ERISA. Relying on a number of different legal theories—from an initial theory that pensions were gratuities offered by employers to the recognition that pension promises could create contractual rights—the courts repeatedly found ways to allow employers to promise much and provide little to workers expecting retirement security. In Section III, this Article addresses how Congress failed to create an effective structure for strong bureaucratic enforcement and the bureaucratic agencies with enforcement responsibilities failed to fulfill those functions. Finally, in Section IV, this Article discusses how the …

A Reflection On Erisa Claims Administration And The Exhaustion Requirement, James A. Wooten

Journal Articles

This essay, prepared in connection with the Drexel Law Review Symposium, ERISA at 40: What Were They Thinking?, examines ERISA’s regime for administering benefit claims and, in particular, the requirement that participants exhaust their plan’s review procedures before filing suit to recover benefits. Like other key elements of ERISA’s claims regime, the exhaustion requirement is a judicial creation that is not articulated in ERISA’s text. Interestingly, former congressional staffers who attended the Symposium said they assumed participants would be required to exhaust plan review procedures but failed to include such a requirement in the legislation. After reviewing the development of …

How To Accomplish A Successful Tax-Free Pension Plan Rollover, Steven T. Graham

Pepperdine Law Review

Advising a client how to accomplish a tax-free rollover from one pension plan to another has been an area of confusion for the general practitioner. In order to end this confusion the author examines recent statutory amendments, Internal Revenue Service rulings and the Employee Retirement Income Security Act. The author then outlines, in conjunction with the recent changes in the law, potential pension plan rollover scenarios that can aid the client. After a thorough discussion of the available rollovers and the benefits and drawbacks of each, the author concludes with a chart designed to provide quick identification of the most …

Disclosure To The Rescue: A Conceptual Framework For Retained Asset Accounts, Maria O'Brien

Faculty Scholarship

RAAs (Retained Asset Accounts) are a life insurance innovation that is likely of small value to most beneficiaries. In many cases, it will make the most financial sense for a beneficiary to write a check to himself for the entire policy proceeds and deposit those funds into an insured bank account. Some beneficiaries, however, may find the RAA device helpful. It is impossible to anticipate the myriad circumstances that beneficiaries may face at the time of an insured's death. As long as insurers provide full and clear disclosure (which ERISA fiduciary standards demand), consumers should remain free to choose an …

A Primer On The History And Proper Drafting Of Qualified Domestic-Relations Orders, Terrence Cain

Law Faculty Scholarship

The divorce rate in the United States is slightly more than one-half the marriage rate. Divorce is a fact of life in this country, and will likely be so for the foreseeable future. On August 23, 1984, the divorce lawyer’s job got more complicated when Congress created the Qualified Domestic Relations Order ("QDRO") as part of some significant amendments to ERISA. QDROs are necessary because before those 1984 ERISA amendments, a lot of divorced persons discovered that they could be deprived of their marital or community property interest in their former spouses' retirement plans. For most divorcing couples, the two …

The Transformation Of The American Pension System: Was It Beneficial For Workers?, Edward N. Wolff

Upjohn Press

The share of Americans with defined contribution pension plans now exceeds the share of those with defined benefit plans. Wolff refers to this as the "great transformation" and it leads him to examine recent evidence to see whether there are winners and losers resulting from this switch away from traditional pension plans.

Erisa & Uncertainty, Brendan S. Maher, Peter K. Stris

Faculty Scholarship

In the United States, retirement income and health insurance are largely provided through private promises made incident to employment. These “benefit promises” are governed by a statute called ERISA, which many healthcare and pension scholars argue is the cause of fundamental problems with our nation’s health and retirement policy. Inevitably, however, they advance narrowly tailored proposals to amend the statute. This occurs because of the widely-held view that reform should leave undisturbed the underlying core of the statute. This Article develops a theory of ERISA designed to illustrate the unavoidable need for structural reform.

The Evolution Of The Applicability Of Erisa To Indian Tribes: We May Finally Have Congressional Intent, But It's Still Flawed, Alicia K. Crawford

American Indian Law Review

No abstract provided.

A Primer On The Need To Continue Monitoring Closely The Transfer Of Social Welfare Risk And Liability Of Employee Benefit Plans, James E. Holloway

Cleveland State Law Review

This Article examines why federal legislative policy-makers and judicial decision-makers should ascertain the impact of the transfer of risk and liability on furthering welfare and security interests and preserving organizational discretion under ERISA and public policy. Part I explains why business organizations or employers transfer risk and liability to employees and retirees. This transfer occurs where global business outcomes cause social consequences that are driven directly by business decisions responding to new global competition and less American economic standing. Part II explains the need to assess the substantive issues and public policy concerns underlying legislative acts and judicial interpretations limiting …

Marriage, Property And [In]Equality: Remedying Erisa's Disparate Impact On Spousal Wealth, Paula A. Monopoli

Faculty Scholarship

Congress is considering pension reform in the wake of the tremendous loss in market value of retirement plans during the current recession. This article suggests that this is a historic moment to remedy a previously unidentified, unintended but profound gender disparity embedded in the federal law governing retirement plans in this country. It explores the common perception that while contemporary law and policy aim to facilitate equality within marriage, including in the area of property ownership, embracing equitable distribution in reallocating property upon divorce, the Employment Retirement Income Security Act’s (ERISA) structuring of retirement asset accumulation runs counter to this …

Erisa Misrepresentation And Nondisclosure Claims: Securities Litigation Under The Guise Of Erisa?, Clovis Trevino Bravo

Georgetown Law Student Series

In the wake of recent corporate scandals and dramatic market downturns, many employees whose retirement savings plans were heavily invested in the stock of their employer have seen their account balances substantially depleted. To recover for their losses, plan participants have filed lawsuits under the Employee Retirement Income Security Act (ERISA) alleging that plan fiduciaries made misrepresentations or failed to disclose material information about the suitability of investing in the company stock. These suits are generally derivative or companion cases to securities class actions based on the same allegations of misrepresentations or nondisclosures. Even though there is a significant overlap …

Understanding And Problematizing Contractual Tort Subrogation, Brendan S. Maher, Radha A. Pathak

Faculty Scholarship

The modern incarnation of tort subrogation allows an insurer to force its insured to turn over the litigation proceeds independently obtained by the insured against a third-party tortfeasor, even if the insured has not been made whole by such litigation. This Article demonstrates that such a result is the product of a subrogation-as-contract paradigm that has taken hold in the federal system, most notably by the United States Supreme Court in Sereboff v. Mid-Atlantic Services, 547 U.S. 356 (2006). More importantly, the Article illustrates the conceptual and historical roots of subrogation to demonstrate the extent to which subrogation-as-contract is divorced …