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Univar Solutions 401(k) Plan Breach of Fiduciary Duty ERISA Class Action

This class action brings suit on behalf of the Univar Solutions 401(k) plan and its participants and beneficiaries, under the Employee Retirement Income Security Act (ERISA). The complaint alleges that those responsible for the plan—Univar Solutions USA, Inc., its Board of Directiors, and its Retirement Plan Committee—have breached their fiduciary duties by permitting high costs, high fees, and investment choices with high risk and poor performance for the plan.

The class for this action is all participants and beneficiaries of the Univar Solutions 401(k) Plan, between January 21, 2016 and the date of judgment in this case. Beneficiaries of deceased persons who were participants during this period are also included.

Under ERISA, those responsible for a retirement plan have duties of loyalty and prudence. However, the complaint alleges that the defendants failed in these duties in a number of ways:

  • They “failed to fully disclose the expenses and risk of the Plan’s investment options…”
  • They “allowed unreasonable expenses to be charged to participants…”
  • They chose, maintained, “and/or otherwise ratified high-cost and poorly-performing investments” as options in the plan, even when more prudent alternatives were readily available.

The plan has around 7,449 participants and assets of around $978 million. It is therefore in the top 0.2% of defined contribution plans by size, the complaint says, and therefore has significant power to bargain for better rates in recordkeeping and administrative services.

Page 19 of the complaint shows a table comparing recordkeeping and administrative costs for this plan and other plans of a similar size. This plan shows a per-participant fee of $101, while the others show per-participant fees of from $42 to $59.

Among the investment options offered was a suite of target-date funds (TDFs, managed according to the participants’ expected retirement dates) which consisted of Fidelity Freedom fund TDFs. These are available in what the complaint calls a riskier and more costly Active suite and a less risky and less expensive Index suite. The complaint alleges that the Active suite was chosen for the plan and was even its qualified default investment alternative.

The complaint alleges, “A simple weighing of the benefits of all other available TDFs … would have raised a significant red flag for prudent fiduciaries and indicated that the Active suite was not a suitable and prudent option for the plan.” The Active suite was replaced as an investment option with FIAM Index TDFs in 2019.

Funds charge investors annual fees. The complaint claims, “The fees charged by the Active suite are many multiples higher than the Index suite’s industry-leading low costs.” While the Index suite charged just 0.08%, the Active suite charged between 0.42% and 0.65%. These higher fees take money from the participants’ accounts and put it “straight into Fidelity’s pockets[.]” Charts in the complaint offer comparisons in this area as well.

Article Type: Lawsuit
Topic: Employment

Most Recent Case Event

Univar Solutions 401(k) Plan Breach of Fiduciary Duty ERISA Complaint

January 21, 2022

This class action brings suit on behalf of the Univar Solutions 401(k) plan and its participants and beneficiaries, under the Employee Retirement Income Security Act (ERISA). The complaint alleges that those responsible for the plan—Univar Solutions USA, Inc., its Board of Directiors, and its Retirement Plan Committee—have breached their fiduciary duties by permitting high costs, high fees, and investment choices with high risk and poor performance for the plan.

Univar Solutions 401(k) Plan Breach of Fiduciary Duty ERISA Complaint

Case Event History

Univar Solutions 401(k) Plan Breach of Fiduciary Duty ERISA Complaint

January 21, 2022

This class action brings suit on behalf of the Univar Solutions 401(k) plan and its participants and beneficiaries, under the Employee Retirement Income Security Act (ERISA). The complaint alleges that those responsible for the plan—Univar Solutions USA, Inc., its Board of Directiors, and its Retirement Plan Committee—have breached their fiduciary duties by permitting high costs, high fees, and investment choices with high risk and poor performance for the plan.

Univar Solutions 401(k) Plan Breach of Fiduciary Duty ERISA Complaint
Tags: Breach of Fiduciary Duty, ERISA Violations, Employment Violations, Retirement Plans