Benefits Monthy Minute

The March Monthly Minute brings you three recent case updates addressing 401(k) forfeiture utilization, TPA responsibility for recovering self-insured plan's fraudulently paid claims, and continued PBM litigation in the wake of the J&J case.

Clorox Can't Clean Up Forfeiture Suit

Earlier this month, a California district court refused to dismiss a case against Clorox alleging wrongful use of its 401(k) plan forfeiture account. The case rests on a novel theory that the practice of using forfeitures to reduce plan administrator expenses instead of offsetting administrative costs to plan participants breaches ERISA's duty of loyalty and prudence. Plaintiffs allege that defendants were motivated solely by self-interest in using forfeitures to reduce Clorox's non-elective contributions rather than to reduce participants' administrative costs, and further that defendants utilized an imprudent process by failing to investigate which option was in the best interest of