This lawsuit was filed against Fidelity Investments Institutional Operations Co. Inc. (FIIOC; and Fidelity affiliates), as recordkeeper of the Shell Provident Fund 401(k) Plan, alleging a breach of ERISA fiduciary duties through prohibited transactions in its sharing of participant data with Fidelity affiliates, enabling the cross-selling of other Fidelity “non-plan-related retail financial products and services”, deriving substantial revenue as a result. The basis for this claim rests with the plaintiffs’ allegation that participant data is a “plan asset” under ERISA. In following, FIIOC would be determined to be a fiduciary, profiting from a prohibited transaction – the sharing of participant data – in violation of fiduciary duties. The presiding judge in this case, however, ruled that participant data is not a plan asset, according to the Department of Labor (DOL) regulations defining plan assets, which include reference to investments but not data. Likewise, there is no mention of data in regulation focusing on participant contributions. As such, the prohibited transaction claim was dismissed.
www. planadviser.com; April 1, 2021.