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Fidelity Stable Value Fund Dismissed

The suit alleged that Fidelity Management Trust Co. of engaging in imprudent investment strategies for the Fidelity Group Employee Benefit Plan Managed Income Portfolio Commingled Pool (MIP), offered within several 401(k) plans for which Fidelity served as trustee. Specifically, the fund allegedly had low investment returns and high fees during the class period and was an “imprudent retirement plan investment.” Plaintiffs claimed that Fidelity failed to monitor and supervise Fidelity Management and Research Company in its management of the MIP, resulting in weak performance and high fees, and the purchase of excessive wrap insurance, thus lessening the fund’s returns. The suit was dismissed on the basis that the plaintiffs failed to establish a breach of “duty of loyalty or the duty of prudence.”

www.planadaviser.com; June 22, 2017.