Developments of Note
U.S. Supreme Court Holds that ERISA Plans May Sue Counterparties to Transactions that Violate ERISA
Under the Employee Retirement Income Security Act ("ERISA"), fiduciaries who manage assets of plans subject to ERISA are prohibited from (among other things) causing the plan to enter into transactions with entities that are "parties in interest" with respect to the plan, unless an exemption is available. For this purpose, the term "party in interest" is defined broadly to include, among others, all entities providing services to the plan (e.g., trustees, custodians, brokers, and investment managers and advisers) and certain of their affiliates. While ERISA clearly provides broad remedies against any plan fiduciary who causes the plan to engage in a prohibited transaction (and the Internal Revenue Code ("IRC") imposes related excise taxes against parties in interest engaging in prohibited transations), there has been a conflict among the lower federal courts
