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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:
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