Stifel 401(k) Plan Subject of New $134 Million ERISA Case Over Fund Performance
Alleged underperforming funds are the subject of a $134 million class action ERISA lawsuit against Stifel Financial, Corp. on behalf of more than 10,000 retirement plan participants.
The suit filed today by Sanford Heisler Sharp McKnight alleges retirement plan mismanagement by Stifel Financial and other fiduciaries of the Stifel Financial Profit Sharing 401(k) Plan. According to the allegations in the Complaint, Stifel failed to remove two funds from its Plan—the American Century Large Cap Growth Fund and the Artisan Mid-cap Growth Fund—despite those two funds experiencing poor investment performance for over a decade.
The Complaint alleges that during the last 6 years, the American Century Fund lagged its benchmark, the Russell 1000 Growth Index, by over 30 percentage points (192% versus 131%) as well as comparable large cap growth funds. In the 6 years prior to that, the American Century Fund lagged the Russell 1000 Growth Index by 6.5 percentage points (113% versus 106.5%). Since the American Fund’s inception in 2001, it has underperformed the Russell 1000 Growth Index by 256 percentage points (821% versus 565%), or about 1.41% per year on average.
“Annual underperformance of this magnitude—1% and more—can torpedo a participant’s retirement savings by costing them hundreds of thousands of dollars in lost returns over their careers,” said Charles Field, Co-Chair of the firm’s Financial Mismanagement and ERISA Litigation Practice Group and counsel for Plaintiff and the proposed class. “Cases like this are an important tool for protecting the hard-earned retirement savings of employees.”
Reached by 401(k) Specialist Friday, Stifel Financial declined to comment on the case.
According to a press release today from Sanford Heisler Sharp McKnight, plan participants have invested nearly $160,000,000 in the Plan—or about 7% of the Plan’s assets—in the American Century Fund, and over $73,000,000—or about 3%—in the Artisan Fund. Through these actions, the plaintiffs allege Stifel and the Plans’ fiduciaries breached ERISA’s fiduciary duties of prudence.
Combined, the release said poor investment performance of the American Century and Artisan Funds has cost the Plan and its participants up to $134,000,000 in retirement savings since March 1, 2020.
The named plaintiff filed this case on behalf of the Stifel Plan, which has approximately 10,000 participants and beneficiaries and over $2 billion in assets. Named as Defendants are Stifel Financial Corp., the Plan’s 401(k) Investment Committee, and other Plan fiduciaries.
“ERISA fiduciaries are bound by the highest duties known to law. They are obligated to monitor continuously and remove imprudent investment options. Where breaches occur, the remedy provided by ERISA must be enforced to make up for the losses employees have been forced to bear,” said Sharon Kim, a Partner at Sanford Heisler Sharp McKnight and counsel for the proposed class.
The firm has filed the Stifel 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.
In January, the firm filed a similar $70+ million ERISA class action complaint against Bloomberg’s 401(k) plan alleging Bloomberg failed to remove two funds despite poor investment performance for over a decade.
SEE ALSO:
• $70 Million ERISA Lawsuit Filed Against Bloomberg 401(k) Alleging Plan Mismanagement
• Deep Dive: How Not to Get Sued in 2026: Part 1
• Deep Dive: How Not to Get Sued 2026: Part 2
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.