In-house counsel who regularly deal with employee benefit plans are aware of the myriad responsibilities that accompany these programs under the Employee Retirement Income Security Act (ERISA) and the tax code. Increasingly, plaintiffs’ lawyers and regulators are paying close attention to the fees paid by plans and plan participants for the services required to provide these benefits. These fees include the cost of plan recordkeeping and investment expenses.
Recently, the 7th Circuit added a new dimension to the litigation involving fee challenges to 401(k) and other retirement plans. In George v. Kraft Foods Global, Inc., the court ruled that the employer sponsoring a 401(k) plan and the employees who had responsibility for the management of the plan would be required to stand trial because, in part, they did not initiate a request for proposal (RFP) for plan recordkeeping services every three years, as one supposed expert suggested was a prudent practice.