Lawmaker Introduces Bill Supporting Pleading Standards for ERISA Suits
Congressman Randy Fine (R-FL) on Nov. 18 introduced legislation that would support pleading standards for lawsuits targeting Employee Retirement Income Security Act of 1974 (ERISA) plans.
According to a release from Rep. Fine’s office, the ERISA Litigation Reform Act would amend ERISA to “clarify the burden of proof in certain fiduciary-related claims and establish a targeted stay of discovery during early stages of litigation,” to safeguard a “predictable, fair, and efficient legal framework,” for retirement plan fiduciaries, employers, and participants.
“American workers deserve retirement plans that are well-run and well-protected, not drained by abusive litigation tactics,” said Rep. Fine in a statement. “This bill strengthens fiduciary accountability while preventing meritless lawsuits from driving up plan costs and reducing workers’ retirement security.”
If passed, the legislation would put a halt to the growing tide of ERISA class action litigation.
Daniel Aronowitz, the current assistant secretary of Labor under the Department of Labor (DOL), has advocated for stricter pleading standards to combat the wave of ongoing ERISA suits. In an amicus brief related to the Casey Cunningham v. Cornell University case, Aronowitz urged the Supreme Court to adopt more robust pleading standards, stating that current suits have shifted voluntary employee benefit programs into potential liabilities for fiduciaries.
Education and Workforce Committee Chairman Tim Walberg (R-MI) also offered his support for the bill, adding that such class action lawsuits against ERISA plan sponsors and fiduciaries “prey” on voluntary retirement plans.
“Solutions like Rep. Fine’s ERISA Litigation Reform Act protect the employers who provide for retirees and clarify standards to better understand when lawsuits have actual merit so fiduciaries can do their jobs: help retirees thrive,” wrote Walberg in a statement.
The bill has been referred to the House Committee on Education and Workforce, which has jurisdiction over ERISA, and to the Committee on the Judiciary.
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Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.
