Supreme Court’s decision on Intel vs Sulyma regarding 401ks explained

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Below is a statement from Ropes & Gray tax & benefits partner Josh Lichtenstein on the Supreme Court’s decision on Intel vs Sulyma.

The Justices ruled that employers can’t shorten the window 401(k) participants have to sue over alleged plan mismanagement by simply posting plan information online or sending disclosures in the mail.

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Statement on Intel vs Sulyma

“The Intel vs Sulyma decision has made it clear that the full six-year statute of limitations under ERISA will apply to claims by 401(k) participants against plan sponsors in more circumstances, and on a nationwide basis.  This decision will make it harder for plan sponsors to limit their liability for 401(k) investment menu design decisions, and it may add further momentum to the ongoing wave of fiduciary breach and fee litigation class actions that have already resulted in hundreds of millions of dollars in settlements from plan sponsors. 

The decision will be especially impactful for plan sponsors located in circuits that have traditionally been more willing to limit the period for damages to three years, and who may find themselves more likely to be targeted by class action suits in the future.  This decision is also noteworthy because it will allow the lower courts to assess the underlying question of whether Intel acted prudently when it decided to include alternative investments (such as hedge funds and private equity funds) in its plans.”

- Ropes & Gray tax & benefits partner Josh Lichtenstein

What do you think about the ruling? Let us know in the comments section by sounding off below.

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Jacob Wolinsky
Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver

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