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Nokia Savings 401(k) Plan Breach of Fiduciary Duties Class Action

The Employee Retirement Income Security Act (ERISA) imposes certain duties on those who are responsible for retirement plans, like the Nokia Savings/401(k) Plan. This class action brings suit against Nokia of America, its Board of Directors and its members during the class period, and the Nokia 401(k) Committee and its members during the class period. The complaint alleges that these parties breached their fiduciary duties of loyalty and prudence to the participants and beneficiaries of the Nokia plan.

The class for this action is all persons (except the defendants and their immediate family members) who were participants in or beneficiaries of the Nokia plan, at any time between December 13, 2015 and the date of judgment in this case.

ERISA specifies that those who are deemed to be fiduciaries of retirement plans must take action “solely in the interest of the participants and beneficiaries” of the plan, using the “care, skill, prudence, and diligence” to be expected in the management of a similar plan.

The complaint quotes the Department of Labor as saying that employers must observe a “high standard of care and diligence” and “establish a prudent process for selecting investment options and service providers” as well as “monitor investment options and service providers once selected to see that they continue to be appropriate choices.”

The complaint alleges that those responsible for plans must act wisely in incurring fees, because when a participant loses money in fees, they lose not only the amount of the fees but also the additional amounts they would have earned if the fees had remained in the account.

The Nokia plan had, at all times during the class period, at least $6.3 billion in assets and at one point as much as $8.5 billion. This means that the plan was a “jumbo” plan and had significant bargaining power when negotiating the expenses of the plan.

But the complaint alleges that the fiduciaries in this case breached their duties by “(1) failing to objectively and adequately review the Plan’s investment portfolio with due care to ensure that each investment option was prudent, in terms of cost; and (2) failing to control the Plan’s recordkeeping costs.”

The complaint alleges that the fees for the fund were “unreasonable” during the class period. It charts fees for the Nokia plan’s funds and finds two of them to be as much as 364% and 252%, respectively, above a comparator “ICI Median.” The results are even worse when compared to an “ICI Average.”

According to the complaint, the recordkeeping and administrative costs were also excessive. These charges were a percentage of assets, which the complaint claims was an unnecessarily expensive way to figure them. They resulted in a per-participant charge of around $116 per participant, which the complaint compares to what it sees as more usual charges for larger plans of $21-$34 per participant.

Article Type: Lawsuit
Topic: Employment

Most Recent Case Event

Nokia Savings 401(k) Plan Breach of Fiduciary Duties Complaint

December 13, 2021

The Employee Retirement Income Security Act (ERISA) imposes certain duties on those who are responsible for retirement plans, like the Nokia Savings/401(k) Plan. This class action brings suit against Nokia of America, its Board of Directors and its members during the class period, and the Nokia 401(k) Committee and its members during the class period. The complaint alleges that these parties breached their fiduciary duties of loyalty and prudence to the participants and beneficiaries of the Nokia plan.

Nokia Savings 401(k) Plan Breach of Fiduciary Duties Complaint

Case Event History

Nokia Savings 401(k) Plan Breach of Fiduciary Duties Complaint

December 13, 2021

The Employee Retirement Income Security Act (ERISA) imposes certain duties on those who are responsible for retirement plans, like the Nokia Savings/401(k) Plan. This class action brings suit against Nokia of America, its Board of Directors and its members during the class period, and the Nokia 401(k) Committee and its members during the class period. The complaint alleges that these parties breached their fiduciary duties of loyalty and prudence to the participants and beneficiaries of the Nokia plan.

Nokia Savings 401(k) Plan Breach of Fiduciary Duties Complaint
Tags: Breach of Fiduciary Duty, ERISA Violations, Retirement Plans