A plaintiff in the Gucci America, Inc. Retirement and Savings Plan is accusing the plan sponsor and its benefits committee of breaching fiduciary duties, as well as other violations of the Employee Retirement Income Security Act (ERSA).
According to the complaint, the defendants are accused of charging excessive administrative and investment fees to plan participants. In particular, the plaintiff claims the defendants failed to “fully disclose to participants the expenses and risks of the Plan’s investment options; breached their fiduciary duties under ERISA by allowing unreasonable expenses to be charged to participants for administration of the Plan; and breached their fiduciary duties under ERISA by selecting and retaining opaque, high-cost, and poor-performing investments instead of other available and more prudent alternative investments.”
The complaint states that Gucci America was “particularly egregious” in regards to offering proprietary funds from its service provider Transamerica Retirement Solutions as investment options for participants. The plaintiff argues, “Transamerica has successfully utilized Plan assets in a manner that has been detrimental to the Plan and beneficial to Transamerica insofar as it maximized fees often at the expense of participants’ return.” The plaintiff also accuses the defendants of allowing Transamerica to engage in transactions that posed conflicts of interest, thereby breaching their fiduciary duty.
The complaint alleges that Gucci America failed to monitor plan investments to ensure they “provided adequate available returns” or were not excessively priced, “as were the majority of investments in the plan.”
According to the complaint, the plaintiff seeks “relief for all losses and/or compensatory damages; attorneys’ fees, costs and other recoverable expenses of litigation,” as well as “a permanent injunction against Defendants prohibiting the practices described herein and affirmatively requiring them to act in the best interests of the Plan and its participants.”