Products April 28, 2009

Van Kampen Puts New Equity Offerings in Adviser Channel

Van Kampen Funds has launched a new series of six equity mutual funds advised by Van Kampen Asset Management and sub-advised by O'Shaughnessy Asset Management (OSAM).

Reported by

A news release said the new offerings give individual investors access to OSAM’s investment strategies in U.S. registered mutual funds that are lead managed by Jim O’Shaughnessy.

According to the announcement, the new offerings available via the adviser channel are:

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  • Van Kampen O’Shaughnessy Enhanced Dividend Fund
  • Van Kampen O’Shaughnessy Large Cap Growth Fund
  • Van Kampen O’Shaughnessy All Cap Core Fund
  • Van Kampen O’Shaughnessy Small/Mid Cap Growth Fund
  • Van Kampen O’Shaughnessy International Fund
  • Van Kampen O’Shaughnessy Global Fund.

“At Van Kampen, we recognize the reality that U.S. investors seeking capital appreciation may require exposure to equities to achieve their long-term investment goals,” said Jerry Miller, CEO of Van Kampen, in the news release. “Advisers and their clients are telling us that they want investment strategies that are logical, research-driven and that have been tested over time.”

OSAM is a Stamford, Connecticut-based quantitative money management firm with approximately $4 billion in assets under management as of March 31.

Compliance April 28, 2009

Court Dismisses Claims against JPMorgan Cash Balance Plan

JPMorgan Chase&Co. did not violate the Employee Retirement Income Security Act (ERISA) with its 1989 conversion to a cash balance pension plan and subsequent plan amendments, a court ruled.
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The U.S. District Court for the Southern District of New York also ruled that JPMorgan’s predecessor banks, including Chemical Banking Corporation, did not violate ERISA.

Former participant Frank Bilello alleged that the plan’s failure to specify a projection method for the accrual of benefits resulted in an accrual that was not “definitely determinable” in violation of ERISA. However, the court noted that Sections 402(a)(1) and 402(b)(4) of ERISA do not mention a “definitely determinable” violation created by employer discretion regarding interest rate projection methods. They require generally that benefit plans be “established and maintained pursuant to a written instrument’ that “specif[ies] the basis on which payments are made to and from the plan,’ the court pointed out.

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U.S. District Judge Denise Cote pointed out that Internal Revenue Code (IRC) § 401(a)(25) is the source of the “definitely determinable’ language, and because the definitely determinable requirement is found only in the IRC, and is not expressly incorporated into ERISA, it should not be read into that statute.

In addition, Cote found that Bilello’s allegation that notices distributed in connection with the 1989 and 1997 plan amendments violated ERISA because they failed to warn of a significant reduction in benefit accrual and inaccurately described the plan mistakenly attempts to hold defendants to the standard of ERISA § 204(h), 29 U.S.C. § 1054(h) currently in place, which requires that the notice accompanying a reduction in benefit accrual must “provide sufficient information … to allow applicable individuals to understand the effect of the plan amendment.’ The version of the statute in place at the time of the amendments required notice of only a plan amendment and its effective date, Cote pointed out.

Although the court dismissed those claims, it did not dismiss Bilello’s claim that the notice of plan conversion violated ERISA Section 204(h) because it was inaccurate and misleading.

The case is Bilello v. JPMorgan Chase Retirement Plan, S.D.N.Y., No. 07 Civ. 7379 (DLC), 4/24/09.

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