fbpx

Baptist Health of South Florida 403(b) Plan Fiduciary Duties Class Action

The Employee Retirement Income Security Act (ERISA) “imposes strict fiduciary duties of loyalty and prudence upon employers and other plan fiduciaries[,]” says the complaint for this class action. It brings suit against Baptist Health of South Florida, Inc. (BHSF), its Board of Directors, and its Retirement Plan Committee, alleging that these entities breached those duties in their handling of the company’s 403(b) Employee Retirement Plan.

The class for this action is all persons (excluding the defendants in this case and their immediate family members) who were participants or beneficiaries of the retirement plan at any time between February 3, 2015 and the date of judgment in this case.

The complaint alleges three ways in which the defendants have breached their fiduciary duties to the plan:

  • They did not make sure that the investment options in the plan were prudent in terms of their costs.
  • They kept certain funds as investment options in the plan even though similar options were available with lower costs or better performance over time.
  • They did not control the cost of recordkeeping for the plan.

Costs of investments and fees for services to plans can make a big difference to the participants. This is because the participants lose not only the amount of these fees and costs, but also lose the additional money those amounts would have earned if they had remained invested over time.

During the class period in this case, the BHSF plan had over a billion dollars in assets under management, sometimes as much as a billion and a half. Retirement plans of this size are known as “jumbo” plans and have bargaining power to reduce their fees and expenses.

However, the complaint alleges that the defendants did not do their duty to reduce the plan’s fees and expenses. It provides a chart of expense ratios for the plan’s current investment options and comparisons with an Investment Company Institute (ICI) median.

One thing the complaint objects in particular is a revenue-sharing approach to recordkeeping fees, which it claims simply help hide the actual costs paid for recordkeeping.

Also, some funds offer institutional investor share classes that are identical to investor share classes but with lower fees. The complaint claims the defendants did not take advantage of these cheaper share classes.

In addition, the complaint alleges that some of the funds in the plan should have been replaced with lower-cost and better-performing options. It offers a chart showing these investments and similar alternatives, along with their expense ratios.

Article Type: Lawsuit
Topic: Employment

Most Recent Case Event

Baptist Health of South Florida 403(b) Plan Fiduciary Duties Complaint

August 17, 2021

The Employee Retirement Income Security Act (ERISA) “imposes strict fiduciary duties of loyalty and prudence upon employers and other plan fiduciaries[,]” says the complaint for this class action. It brings suit against Baptist Health of South Florida, Inc. (BHSF), its Board of Directors, and its Retirement Plan Committee, alleging that these entities breached those duties in their handling of the company’s 403(b) Employee Retirement Plan.

Baptist Health of South Florida 403(b) Plan Fiduciary Duties Complaint

Case Event History

Baptist Health of South Florida 403(b) Plan Fiduciary Duties Complaint

August 17, 2021

The Employee Retirement Income Security Act (ERISA) “imposes strict fiduciary duties of loyalty and prudence upon employers and other plan fiduciaries[,]” says the complaint for this class action. It brings suit against Baptist Health of South Florida, Inc. (BHSF), its Board of Directors, and its Retirement Plan Committee, alleging that these entities breached those duties in their handling of the company’s 403(b) Employee Retirement Plan.

Baptist Health of South Florida 403(b) Plan Fiduciary Duties Complaint
Tags: Breach of Fiduciary Duty, ERISA Violations, Retirement Plan Mismanagement, Retirement Plans