The ruling is for the defendants in this case, the fiduciaries of the Georgetown University 403(b) Plan. Plaintiffs claimed that plan fiduciaries failed to evaluate and monitor plan expenses and use bargaining power to negotiate lower expenses for the Plans, paying three different service providers – TIAA, Vanguard and Fidelity – instead of using a single recordkeeper via a fixed fee. The judge in the case ruled to dismiss the case in its entirety, citing that the regulatory framework of 403(b) plans differs from those of 401(k)s, and the complaints do not constitute fiduciary breaches in line with the regulations specific to 403(b) plans. She found no pleading standards to have been met by the plaintiffs with regard to the investment options in the plan, or with regard to the claims alleging the overpayment to multiple recordkeepers verses what could be paid to one. The plaintiffs’ allegation that Georgetown Plans should pay $35/year per participant for services across all three platforms was deemed unfounded, without any factual support. There was no evidence provided that the three platforms would agree to continue current servicing at a lesser fee.
www.planadviser.com; January 9, 2019.