Tag Archives: Pfeil v State Street Bank and Trust Co

Employee Benefits Alert: Plan sponsors of ESOPs and 401(k)s take note

On February 22, 2012, the Sixth Circuit issued a ruling in Pfeil v. State Street Bank and Trust Co., reversing the district court’s dismissal of the case and allowing it to proceed. In so doing, the Sixth Circuit held that the Kuper/Moench presumption of prudence does not apply at the motion to dismiss stage, and that ESOP fiduciaries must do more than allow participant control over a variety of investment options in order to rely on the ERISA Section 404(c) safe harbor defense. These holdings by the Sixth Circuit distinguish it from the rulings of other Circuit Courts, and include potential lessons to be learned by ESOP and 401(k) fiduciaries. 

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