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2Q 2020 Litigation Update Summary

There has been a recent surge of litigation activity reports and updates, most involving excessive fee allegations in the corporate arena, such as the Koch Industries case, with some involving allegations arising from the employment of active management verses passive management, as exemplified in the Matthews International and Costco cases, and particular to target date suites, in the case of Quest Diagnostics, and private-label CITs and conventional CITs, in the Estee Lauder case.

Excessive fee and self-dealing cases also continue among those in the investment manager community, such as Goldman Sachs and AonHewitt, and in the Fidelity Retirement Savings Plan proposed settlement.

Data breaches resulting in fraudulent activity have also been reported, as in the Boeing case in which the defendant fraudulently withdrew hundreds of thousands of dollars from participant retirement plan accounts, and in the Leventhal Sutton & Gornstein 401(k) Plan Case in which over $400,000 was fraudulently withdrawn from the plaintiff’s account. At issue in each case is the fraudulent activity itself as well as liability for safeguarding plan data.