What do Jeff Bezos, Jimmy Stewart and Michelle Obama have in common? An alma mater that’s getting sued. Princeton University is the latest prestigious institution of higher learning to be targeted over its retirement plan.
The proposed class action challenges the fees and investment menu options contained therein.
The suit, Nicolas v. Trs. of Princeton Univ., comes on the heels of a similar suit filed last week against the University of Chicago, as well as lawsuits filed last year against Duke University, John Hopkins, The University of Pennsylvania, Vanderbilt, Massachusetts Institute of Technology, New York University, Yale and Columbia, all alleging ERISA violations.
“Like many other schools, Princeton is accused of failing to effectively negotiate for lower plan fees; choosing high-fee investment options that consistently underperformed their benchmarks; overpaying for record-keeping services by using multiple plan record keepers; and offering a TIAA-affiliated fixed-income fund that unreasonably restricted investors’ options,” Bloomberg BNA reports.
The legal action is part of a larger movement towards lower fees industry-wide, attracting the attention of tort lawyers to many private sector retirement plans.
The most recent lawsuit, as well as the University of Chicago, were filed by Schneider Wallace Cottrell Konecky Wotkyns LLP and Berger & Montague PC, .
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
