An ABA Journal piece today suggests that yesterday’s Supreme Court decision allowing individuals to sue their 401(k) plans under ERISA isn’t just good news for plaintiffs’ attorneys.
In LaRue v. DeWolff Boberg & Associates, No. 06-856, the Court held that ERISA provides a remedy for recovery for fiduciary breaches that impair the value of retirement plans.
But defense attorneys are taking a careful look at Chief Justice John G. Roberts, Jr.’s concurrence, which- as one attorney put it – “provide[s] a pleasant surprise from the defense perspective.”
According to the article, which cites reports from Portfolio, The New York Times and The Washington Post:
A concurrence by Chief Justice John G. Roberts Jr. said that the wording of the 401(k) plan may require LaRue to pursue a narrower “denial of benefits” remedy that would require him to exhaust administrative remedies [first]. His opinion was joined by Justice Anthony M. Kennedy.
Still the ruling was unhappy news for some business advocates, the Post reports:
Business advocates predicted the ruling would unleash a raft of lawsuits by employees, particularly as stock market volatility once again is causing havoc with investment accounts.
“Ultimately, employers aren’t going to sponsor plans if they’re going to be sued every time they make an innocent mistake,” said Thomas Gies, a Washington lawyer who defended the consulting firm, which denies any wrongdoing.