Compliance January 2, 2007
Fidelity Tagged in Another 401(k) Fee Suit
The St. Louis-based law firm of Schlichter Bogard&Denton has filed another 401(k) fee lawsuit.
Reported by Nevin E. Adams
The suit – this one against plan sponsor ABB Inc., and plan trustee Fidelity Management Trust – was filed last week in the Western District of Missouri on behalf of five participants in Norwalk, Connecticut-based ABB Inc’s Personal Retirement Investment and Savings Management Plan (ABB has a subsidiary in Jefferson City, Missouri).
Fidelity was recently named in a similar suit last month by the same law firm (see Deere Workers Hit Fidelity with Excessive 401(k) Fee Suit). However, they have not been a party to the dozen or so fee-related suits filed thus far.
“Unreasonable and Excessive” Fees Alleged
As have a series of other actions filed by the St. Louis-based law firm, the suit alleges that the fees and expenses paid by the plan, “…and thus borne by plan participants … are unreasonable and excessive; not incurred solely for the benefit of the plan and their participants.’ Additionally, as have similar actions, the suit, which seeks class action status, claims that the fees paid were not adequately disclosed to participants (see Lawyer: Excessive Fee Suits Not an Organized Anti-Plan Campaign).
“We disagree with many of the factual and legal assertions in the complaint, and we intend to defend the suit vigorously,” said Vin Loporchio, a spokesman for Fidelity Investments, in published reports.
According to the Associated Press, Loporchio said the company doesn’t comment on litigation or specific fee arrangements with clients, but “we believe that we provide valuable services to 401(k) clients for whom Fidelity serves as a record keeper and a trustee.”
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