The status of alternative investments as viable options on
401(k) plan menus received a significant boost on Jan. 21, as a
California federal judge granted defendants' motion to dismiss
in the latest development in the closely watched Anderson v. Intel
Corp. Investment Policy Committee case.1
In a strongly worded opinion, U.S. District Judge Lucy Koh of
the U.S. District Court for the Northern District of California
rejected claims that the defendants breached their Employee
Retirement Income Security Act, or ERISA, fiduciary duties by
including certain alternative assets — such as hedge funds
and private equity — in Intel's defined contribution
plans.
This decision marks the first time that a court has
substantively addressed the question of whether a sponsor of a
retirement plan can be held liable for a breach of fiduciary duty
for including nontraditional investment strategies on a plan's
investment lineup.
