Rights of Individual Plan-Holders Expanded By Sixth Circuit
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According to ERISA attorney Jason Sheffield, a recent decision by the U.S. Court of Appeals for the Sixth Circuit opens the courtroom doors wider to individual plan participants. In Tullis v. UMB Bank, the Sixth Circuit grants individuals legal standing to sue (rather than have to show damage to the entire plan).
According to the opinion (decided and filed on January 28, 2008 by circuit judges Merritt, Rogers and McKeague), ERISA allows these two Toledo Clinic Employees' 401(k) Profit Sharing Plan participants to proceed with a case against the fiduciaries of UMB Bank. By way of background, in the early 1990's, the two doctors selected an investment advisor affiliated with Continental Capital Corporation. In the fall of 1999, the U.S. Securities and Exchange Commission "entered a Temporary Restraining Order against Capital because two of its brokers were engaged in fraudulent activities. The plaintiffs contend that the defendant, UMB Bank, which served as the Trustee for the plan, knew of the fraud yet failed to inform them."
In the aftermath of a recent U.S. Supreme Court case (LaRue v. DeWolff, Boberg & Associates, Inc.), is it likely that plan fiduciaries are more vulnerable to allegations of breach?
Click to read a copy of the Tullis, et al. v. UMB Bank, 515 F.3d 673, 678-79 (6th Cir. 2008) opinion. For an analysis of this case and many others, visit www.pensionlitigationdata.com, Resources, Analyses by Circuit or Analyses by Topic. (A subscription is required.)
Click to read the LaRue v. DeWolff, Boberg & Associates, Inc. opinion. Click to read "U.S. Supreme Court Rules 9-0 in Major Pension Case" and "LaRue, Corporate Governance and the Next Pension Enron."
