This class action concerns the Stanley Black & Decker Retirement Account Plan, bringing suit under the Employee Retirement Income Security Act (ERISA). The complaint alleges that Stanley Black & Decker, Inc., its Board of Trustees, and the plan’s Administrative Committee breached their fiduciary duties to the plan in causing it to pay excessive recordkeeping fees and in maintaining poorly-performing default investment options in the plan.
The class for this action is all participants and beneficiaries in the Stanley Black & Decker Retirement Account Plan, at any time between July 29, 2016 and the date of judgement in this case, or an earlier date determined by the court, including any beneficiary of a deceased person who was a participant in the plan at any time during the class period.
The complaint makes two allegations: (1) that the defendants allowed the plan to pay unreasonable charges for services, and (2) that it chose or retained poorly-performing options as fund investments instead of choosing or replacing them with better-performing alternatives that were available at the time.
The plan is a large one, with more than 20,000 participants as of the end of 2020 with account balances of around $2.18 billion, putting it in the top 0.1% of similar plans by size. The complaint therefore alleges that it had considerable bargaining power to obtain services at lower costs.
The complaint contends that even a small difference in fees can make a large difference eventually, because the participant loses not just the amount paid in fees but also the gains that money would have earned over time had it remained in the account.
According to the complaint, recordkeeping and administrative (RK&A) fees are generally charged on a per-participant basis. The complaint alleges that the roughly $49 charged per participant for the Stanley Black & Decker plan is higher than the average for other large plans. It shows a chart comparing this fee with fees for other large plans, ranging from $23 to $34.
As to poorly-performing investments, the complaint highlights the BlackRock LifePath Index Funds, which is a suite of target date funds (TDFs). TDFs are identified by participants’ expected retirement year that adjust their underlying investments to reflect changing aims as their participants move through life towards retirement.
The complaint alleges, “A simple weighing of the merits and features of all other available TDFs at the beginning of the class period would have raised significant concerns for prudent fiduciaries and indicated that BlackRock TDFs were not a suitable and prudent investment.” The funds unfortunately were chosen as the qualified default investment alternatives in the fund
The complaint displays numerous charts to support the contention that these funds performed poorly as compared to other, readily available similar funds.
Article Type: LawsuitTopic: Employment
Most Recent Case Event
Stanley Black & Decker Retirement Plan Breach of Fiduciary Duties Complaint
July 29, 2022
This class action concerns the Stanley Black & Decker Retirement Account Plan, bringing suit under the Employee Retirement Income Security Act (ERISA). The complaint alleges that Stanley Black & Decker, Inc., its Board of Trustees, and the plan’s Administrative Committee breached their fiduciary duties to the plan in causing it to pay excessive recordkeeping fees and in maintaining poorly-performing default investment options in the plan.
Stanley Black & Decker Retirement Plan Breach of Fiduciary Duties ComplaintCase Event History
Stanley Black & Decker Retirement Plan Breach of Fiduciary Duties Complaint
July 29, 2022
This class action concerns the Stanley Black & Decker Retirement Account Plan, bringing suit under the Employee Retirement Income Security Act (ERISA). The complaint alleges that Stanley Black & Decker, Inc., its Board of Trustees, and the plan’s Administrative Committee breached their fiduciary duties to the plan in causing it to pay excessive recordkeeping fees and in maintaining poorly-performing default investment options in the plan.
Stanley Black & Decker Retirement Plan Breach of Fiduciary Duties Complaint