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NEWS - Edison Wins Dismissal of Excessive Fee Suit

April 14, 2016 – The 9th U.S. Circuit Court of Appeals has again affirmed dismissal of a lawsuit against Edison International over three retail-class mutual funds it added to its 401(k) plan in 1999.

In the original case, Glenn Tibble accused Edison and plan fiduciaries of violating their fiduciary duties under the Employee Retirement Income Security Act (ERISA) by adding retail-class mutual funds to the plan when lower-cost institutional-class funds were available. Edison added three retail-class mutual funds to the plan in 1999, and three more in 2002.

The U.S. District Court for the Central District of California found the defendants violated their duties under ERISA for the three funds added in 2002, but dismissed claims concerning the funds added in 1999, saying they were added before ERISA’s six-year statute of limitations on lawsuits. The 9th Circuit affirmed this decision.

However, Tibble asked the U.S. Supreme Court to review the case and determine whether plan fiduciaries’ duty to monitor investments created an ongoing circumstance not barred by the statute of limitations. The Supreme Court found the “ongoing duty to monitor” investments is a fiduciary duty that is separate and distinct from the duty to exercise prudence in selecting investments for use on a defined contribution plan investment menu.

The Supreme Court remanded the case to the 9th Circuit, instructing it to decide whether Tibble forfeited the ongoing-duty-to-monitor argument by not raising it before the court previously. The appellate court recognized a “general rule” against entertaining arguments on appeal that were not presented or developed before the district court.

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http://www.plansponsor.com/Edison-Wins-Dismissal-of-Excessive-Fee-Suit/