The 401(k) retirement plan offered to employees of JP Morgan
Chase Bank is now the target of a third Employee Retirement Income Security Act
This challenge has also been filed in the U.S. District
Court for the Southern District of New York, and argues
like the first two lawsuits that the firm loaded the investment menu of the
retirement plan with its own proprietary products and those of its business partner,
BlackRock—to promote the financial interest of both entities rather than that
of the plan participants.
The text of the suit offers a detailed look at the
investment menu offered to JP Morgan employees, as well as the way fees for the
plan have been assessed during recent years. Plaintiffs assert that various
conflicts of interest were permitted to exist within the plan ecosystem, and
that the plan’s fiduciaries breached their fiduciary duties of loyalty and
prudence by continuing to select and retain “unduly expensive core funds and
Plaintiffs argue that, “in selecting and maintaining
investment options that generated significant revenue for JPMorgan Chase or its
affiliates or BlackRock, the [plan fiduciaries] acted in transactions involving
the plan on behalf of a party (or represent a party) whose interests are adverse
to the interests of the plan or the interests of its participants or
beneficiaries.” Accordingly, the plaintiffs allege that the plan officials’ “imprudent,
disloyal, self-interested and otherwise conflicted decisions” violated ERISA’s
prohibited transaction provisions.
The full text of the lawsuit is available here.