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MGM Resorts International Excessive Fee Lawsuit

Participants in the MGM Resorts 401(k) Plan have alleged a breach of fiduciary duty, as the Plan’s investment management and recordkeeping fees have been deemed excessive. Plaintiffs allege that plan fiduciaries failed to review fees of the investment products offered and investigate lower share class options when they were available. Further, the use of some of actively managed funds in lieu of passively managed options have been called into question. The plaintiffs also allege that fiduciaries failed to use their bargaining power given the Plan’s size and should have been able to negotiate lower recordkeeping fees. Lastly, the lawsuit mentions that the defendants did not regularly issue “RFPs” as a means to assess reasonableness of plan fees.

www.planadviser.com; September 25, 2020.