This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies.
Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...
There’s been no slow down this year in the number of class actions brought against major employers that provide their workers with retirement plans.
Two law firms in particular—Schneider Wallace and Bailey & Glasser LLP—were the most active filers of Employee Retirement Income Security Act class actions.
Since October 2016, these two firms each filed nine ERISA lawsuits seeking class treatment, according to an analysis of Bloomberg Law dockets. The cases have mainly targeted financial institutions, prominent private universities, and administrative service providers, among others.
While these two firms have filed the most cases in the past year, their cases make up only 14 percent of the 125 ERISA class actions that were filed in federal court since mid-October 2016. At least 35 of these lawsuits—nearly 30 percent—challenge excessive fees in retirement plans.
Schneider Wallace filed lawsuits against Xerox HR Solutions, Aon Hewitt Financial Advisors, Charles Schwab Corp., State Street Bank & Trust, Jackson National Life Insurance Co., and three prominent universities— Washington University in St. Louis, Brown University, and University of Chicago. The lawsuits challenge the relationship between certain retirement plan service providers and online investment advisers, as well as the alleged excessive fees in retirement plans sponsored by colleges and financial institutions.
Schneider Wallace is a national law firm with offices in San Francisco, Arizona, and Texas. The firm’s ERISA practice includes seven attorneys. “There is a huge demand for our services,” founding partner Todd Schneider told Bloomberg Law. Very few law firms understand ERISA, understand litigation, and are willing to take these complex cases to court, he added.
The trick is not about finding clients, but about vetting the cases properly, Schneider said. The law firm only files a lawsuit in about 1 percent of the cases potential clients have brought to the firm, he said.
With 10 offices across the U.S., Bailey & Glasser also filed nine ERISA class actions in the past year. Six of these lawsuits challenged certain transactions involving employee stock ownership plans. The firm represents a number of employees who were allegedly shortchanged in transactions handled by M&T Bank’s subsidiary Wilmington Trust NA, Bankers Trust of South Dakota, and GreatBanc Trust Co. Earlier this year, the firm obtained a $29.8 million judgment in an action against Wilmington Trust.
The firm also filed three lawsuits this year representing workers of Seventy Seven Energy, Phillips 66, and Marathon Petroleum Corp. The lawsuits challenge the companies’ decision to allow their workers to invest, through their retirement savings plans, in the declining stock of their previous parent company Chesapeake Energy Corp., ConocoPhillips, and Marathon Oil Corp.
These are the cases to watch this year because they raise novel and untested theories, Greg Porter, head of Bailey & Glasser’s ERISA practice, told Bloomberg Law. With four full-time lawyers focusing on ERISA litigation, the firm looks for three things before filing a case: how far the liability goes, how much money the plan has, and who the defendants are and whether they can pay, Porter said.
Here’s a roundup of the other law firms making waves in ERISA litigation over the past year:
To contact the reporter on this story: Carmen Castro-Pagan in Washington at ccastro-pagan@bloomberglaw.com
To contact the editor responsible for this story: Jo-el J. Meyer at jmeyer@bloomberglaw.com
Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to books@bna.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to research@bna.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)