Eleventh Circuit Issues Important Decision On 401(k) Fee Litigation Case Dismissed

Originally published July 2007

On June 21, 2007, in one of the first cases to address whether ERISA requires the disclosure of fees paid to 401(k) service providers, the United States District Court for the Western District of Wisconsin dismissed plaintiffs’ claims that the fiduciaries of a 401(k) plan sponsored by Deere & Company ("Deere") violated their fiduciary duties under ERISA by failing to disclose revenue-sharing fee arrangements to participants. Hecker v. Deere & Co., 06-C-719-S, 2007 U.S. Dist. LEXIS 45275 (W.D. Wis. June 21, 2007). Significantly, the Court ruled that as currently drafted, neither ERISA nor the regulations promulgated thereunder require plan sponsors to disclose revenue-sharing arrangements. Id. at *11-14. The court also dismissed plaintiffs’ claim that defendants breached their fiduciary duties by selecting funds that charged allegedly excessive fees to participants.