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Nestle Excessive Fee Lawsuit

A participant in the Nestle 401(k) Savings plan has filed a proposed class action lawsuit claiming that Nestle breached fiduciary duties under ERISA, allowing the Plan to pay unreasonably high recordkeeping and administrative fees and managed account fees as well as engaging in self-dealing with respect to plan administration. With regard to the managed account claim, Nestle offers Voya Retirement Advisor’s managed account service to plan participants, in which a graduated fee schedule applies, ranging between .25% and .50% based on a participant’s plan account assets, alleged to be higher than those of similarly situated plans. Further, the lawsuit alleges that the value of the managed account service was nil, as asset allocations recommended by the program were not “materially different” from the allocation of age-appropriate target date products.; October 13, 2020.