Bloomberg’s 401(k) plan is the latest target of an ERISA lawsuit, as today Sanford Heisler Sharp McKnight filed a $70+ million ERISA class action complaint in the U.S. District Court for the Southern District of New York alleging retirement plan mismanagement.
According to the allegations in the Complaint, Bloomberg failed to remove two funds from its Plan—the Harbor Capital Appreciation Fund and the Parnassus Core Equity Fund—despite those funds suffering from poor investment performance for over a decade.
The lawsuit claims the Harbor Capital Appreciation Fund suffered 16 years of underperformance, as compared to the fund’s market benchmark, the Russell 1000 Growth Index, and other comparable large-cap growth funds. The Parnassus Core Equity Fund suffered a decade of underperformance, as compared to the fund’s market benchmark, the Standard & Poor’s 500 Index, and other comparable large-cap core funds. Faced with this type of persistent, long-term poor performance, the Complaint asserts that Bloomberg should have removed the two Funds years ago. Instead, Bloomberg has kept them in the Plan, allegedly costing Bloomberg employees and retirees millions in retirement savings.
Plan participants invested over $437 million of their retirement savings in the Harbor Fund and over $59 million in the Parnassus as of the end of 2024. Through these actions, Sanford Heisler Sharp McKnight claims Bloomberg and the Plans’ fiduciaries breached ERISA’s fiduciary duties of prudence.
“Cases like this one against Bloomberg are an important tool for protecting the hard-earned retirement savings of employees and ensuring continuing positive change in retirement plan management.”
Charles Field, Sanford Heisler Sharp McKnight
The named plaintiff Rajkumar Rajappan filed this case on behalf of the Bloomberg Plan, which has approximately 20,000 participants and beneficiaries and over $5 billion in assets. Named as Defendants are Bloomberg, L.P., the Bloomberg Investment Committee and its members, the Retirement Plan Committee and its members.
“Cases like this one against Bloomberg are an important tool for protecting the hard-earned retirement savings of employees and ensuring continuing positive change in retirement plan management. This is especially important for large plans such as Bloomberg’s that holds billions of dollars of their employees’ retirement savings,” said Charles Field, Co-Chair of the law firm’s Financial Mismanagement and ERISA Litigation Practice Group and counsel for Plaintiff and the proposed class.
“Our Complaint sets out that the Bloomberg Defendants seemingly ignored clear warning signals, keeping these two Funds in the Plan despite years of underperformance,” said Russell Kornblith, a Partner and General Counsel at the Firm and counsel for the proposed class. “We alleged that the Bloomberg Defendants’ decision not to remove either the Harbor Fund or the Parnassus Fund breached their fiduciary responsibilities to act with a singular focus on the needs of the Plan’s participants and beneficiaries, costing the participants tens of millions.”
401(k) Specialist reached out to Bloomberg L.P. for comment regarding today’s filing but has not yet received a response.
Sanford Heisler Sharp McKnight has filed the Bloomberg ERISA complaint on the heels of several significant ERISA class settlements in 2024 and 2025. In 2025, the firm obtained final approval of a record $69 million settlement in its multi-year class action against UnitedHealth Group. In 2024, Sanford Heisler Sharp McKnight, together with co-counsel, also obtained final approval of a $61 million settlement in a long-running ERISA class action against General Electric. The UnitedHealth and GE settlements were among the most significant ERISA settlements in recent years. They were also among the highest value settlements ever in cases involving allegedly poor-performing plan investments.
Sanford Heisler Sharp McKnight was also the law firm for plaintiffs in the Pizarro v. Home Depot 401(k) case, where the plaintiffs earlier this month withdrew their petition for certiorari from the U.S. Supreme Court just two days before the Supreme Court was slated to decide whether to use the dispute to hear oral arguments and review a circuit court split on the issue under ERISA.
“This outcome should provide reassurance to the regulated community that the Department of Labor is committed to ending regulation by litigation and to defending ERISA as Congress intended,” said Assistant Secretary of Labor for Employee Benefits Security Daniel Aronowitz in praising the outcome that effectively ended a case started in 2018. “This result reflects a victory for common sense, sound legal doctrine, and the millions of American workers who rely on employer-sponsored retirement plans.”
The DOL advised the court in an amicus brief that the case warranted review, but only to reaffirm settled legal principles and reject the plaintiffs’ position. The department also warned that the plaintiffs’ proposed expansive reading of ERISA would fuel meritless litigation and impose unnecessary costs on plan sponsors—outcomes fundamentally at odds with ERISA’s goals of efficiency, predictability, and encouragement of employer-sponsored retirement plans.
SEE ALSO:
• DOL Celebrates Withdrawal of Supreme Court Petition in Home Depot 401(k) Case
• Record-Breaking $69 Million Settlement in UnitedHealth 401(k) Case Finalized
• $61 Million Settlement Finalized in GE ERISA Case