Request a Proposal

Delta Air Lines vs. Fidelity

Participants in the Delta Air Lines, Inc. Retirement Plan allege that Fidelity Management Trust Company breached its ERISA fiduciary duties by receiving “unreasonable compensation” through its brokerage window and engaging in a “kickback” scheme with Financial Engines Advisors, LLC. More specifically, Fidelity is alleged to have offered higher expense mutual funds in the Plan brokerage window, receiving significant revenue sharing payments in violation of ERISA, increasing its compensation at the expense of participants, who paid Fidelity substantial fees for the access to funds in the window. Moreover, the funds offered in the window were apparently already available on Fidelity’s platform. The lawsuit also alleges that Financial Engines agreed to pay Fidelity a large percentage of the fees collected from plan participants using its service, when Fidelity was simply providing an “electronic mechanism for implementing instructions that they could implement on their own.”

www.bna.com; Pension & Benefits Daily; May 24, 2016.