On Monday, December 6, 2021, the U.S. Supreme Court will hear oral argument in an important case titled Hughes v Northwestern University, which provides the Court an opportunity to improve the lives of countless retirement savers by giving them a chance to hold those who administer retirement plans accountable when they breach their fiduciary duties.
What we said: We joined in an amicus brief led by AARP in which we urged the Supreme Court to reverse the lower court’s decision, restore the plaintiffs’ claims, and give them a chance to prove their case. As we said in the brief, the lower court decision in the Seventh Circuit misinterprets the plan administrator’s duty to monitor investments and applies an unfair and overly stringent pleading standard.
Why it matters: Hughes is all the more important as the retirement crisis in this country intensifies and Americans increasingly rely on prudent administration of their 401(k)’s to close the gap between their savings and what they’ll need to maintain a decent retirement.
Bottom line: If the Supreme Court affirms dismissal of the plaintiffs’ complaint in this case, those victims of fiduciary misconduct will suffer irreparable harm. More broadly, other retirement plan participants sustaining similar forms of injury in the future will face higher hurdles to obtain relief. The upshot would be doubly damaging: It would relax the incentives that are necessary to ensure compliance with the high fiduciary standard embodied in ERISA, and it would thwart Congress’s goal of affording victims of abuse under ERISA ready access to the federal courts to seek relief.
Read the amicus brief here or click the button below.