Will Supreme Court’s Ruling on Intel Case Change Fiduciaries’ Benchmarking?

Following Tuesday’s oral arguments before the U.S. Supreme Court in Anderson v. Intel Corp. Investment Policy Committee, industry professionals largely agreed that the justices appeared focused on whether plaintiffs should be required to identify a “meaningful benchmark” when alleging underperformance.

The case, which consolidates suits from 2015 and 2019 by former Intel 401(k) participants, challenges Intel fiduciaries’ decision to allocate portions of the plan’s custom target-date and diversified funds to private equity and hedge funds.

After the U.S. District Court for the Northern District of California dismissed the case and the U.S. 9th Circuit Court of Appeals upheld the ruling, the Supreme Court is now determining whether plaintiffs must identify meaningful benchmarks in order to proceed with claims that plan investments underperformed comparable alternatives and with claims that plan fiduciaries breached their duties under the Employee Retirement Income Security Act.

The Supreme Court asked both parties to define “meaningful benchmark” on Tuesday, but justices said the plaintiffs’ attorney had “shifted ground” from presenting benchmarks as an “apples to apples” comparison. Several legal observers said the oral arguments strongly suggest what the court may view as “meaningful,” providing early clues about how plan fiduciaries may need to document investment comparisons in the future.

Changing Investment Measurements

Even though a decision may not be announced until the spring, industry observers said there were already tangible takeaways from the oral arguments that fiduciaries and sponsors can implement into investment practices and comparisons.

“Plan sponsors … need to task their consultants to make sure that they’re comparing their funds to a handful of other funds that have similar age risks and rewards,” says Charles Field, co-chair of Sanford Heisler Sharp McKnight’s financial mismanagement and ERISA litigation practice group. “Typically, what I see is that the plan sponsors or the committees that review these [investments] will compare all the funds relative to a benchmark … and maybe they should pick out a handful of funds and explain why these funds have similar age risks as official rewards.”

Fields’ recommendation to implement a benchmark for funds that resemble similar risks is based on the assumption that that benchmark will be the most important element of the case for sponsors and advisers to consider.

However, other sources recommend waiting for the court decision, as any immediate—and potentially drastic—changes to benchmarking could interfere with ERISA.

“I don’t think that the arguments necessarily mean that plan sponsors or advisers will, or should, change what they’re doing in benchmarking or monitoring 401(k) funds, because the underlying standards haven’t changed,” says Caroline Wrong, a partner in Sidley Austin LLP’s ERISA litigation practice. “ERISA requires plan fiduciaries, such as plan sponsors or investment advisers, to have a prudent process for considering selection of funds and in monitoring those funds, including weighing pros and cons and considering potential alternatives.”

Wrong does expect benchmarking to change following the Supreme Court decision.

“I would expect more nationwide uniformity in the kinds of arguments that defendants in these cases can make at the motion to dismiss stage,” she says.

In an email to PLANADVISER, Erica Rozow, a partner in Simpson Thacher & Bartlett LLP’s executive compensation and employee benefits practice, also emphasized the importance of keeping ERISA duties at the forefront of priorities as sponsors and advisers await a final decision.

“If the Supreme Court affirms a meaningful benchmark standard for alleging imprudence based on performance, plan fiduciaries may put more emphasis on identifying such benchmarks in anticipation of potential litigation” she wrote.

Moving Beyond Benchmarks?

Field says the justices’ push for criteria defining “meaningful” benchmarks makes him think the Supreme Court will focus its ruling on that definition.

“I’m looking for the court to give us some guidance as to what they define as similar or meaningful, and then I suspect they’re going to send it back to the 9th Circuit and ask them to assess their guidance to determine whether the allegations in that Anderson complaint showed meaningful comparatives,” Field says. “They’re going to come out with some kind of requirement that if you’re going to plead underperformance, that you need to have a meaningful comparative.”

Wrong says the oral arguments showed promise for the Intel defendants’ side of the case.

“It’s always hard to predict how a case will come out, but I thought that the direction of questioning for this one in particular consistently suggested that we should expect an affirmative [ruling] in the plan sponsor’s favor in this one,” says Wrong.

Similarly, a recent analysis by law firm Ropes & Gray LLP anticipates a similar outcome.

“It appears very likely that the 9th Circuit’s decision in Intel’s favor will be affirmed,” wrote the authors, partners Douglas Hallward-Driemeier, Joshua Lichtenstein, Amy Roy and Robert Skinner.

They also emphasized that the Supreme Court will likely agree with the 9th Circuit ruling that a meaningful comparator is required to plead plausible claims of imprudence based on underperformance.

As the industry speculates what conclusion the courts will come to, one detail that remains at the core of the argument is the need for a benchmark.

“The focus of the arguments was on when, rather than if, the meaningful benchmark standard should apply,” wrote Rozow. “Given the Supreme Court repeatedly returned to the particular issue of whether a plaintiff must show a meaningful benchmark when alleging imprudence based on performance, I suspect the ruling may be narrowly tailored.”

The Alts Effect

Because the plaintiffs’ argument in Anderson v. Intel centers on the plan’s allocations to private equity and hedge funds, observers are also watching the case for potential implications on the Department of Labor’s ongoing efforts to finalize its safe harbor rule for fiduciary consideration of alternative investments in 401(k) plans, which followed President Donald Trump’s August 2025 executive order calling for more private equity investments in 401(k)s.

Rozow expects the DOL to wait for the court’s decision before issuing its final safe harbor rule.

“Performance benchmarking was one of the safe harbor factors identified in the DOL’s proposed rule, which drew comments suggesting the DOL should elaborate further on how to identify an appropriate benchmark,” Rozow stated. “When asked whether it would be helpful for the Supreme Court to define ‘meaningful,’ Aimee Brown, assistant to the solicitor general [in the Department of Justice], indicated that the DOL would welcome more Supreme Court guidance.”

According to Wrong, it was particularly noteworthy that the case did not mention the DOL rule at all during oral arguments.

“A decision that affirms the 9th Circuit and adopts the meaningful benchmark standard can be viewed as consistent with the policy reflected in the DOL rule,” she says. “I think practitioners in this space have been particularly interested to see whether the direction that the justices go in this case is consistent with, or opposite to, the policy that’s reflected in the DOL rule.”