B. Braun Medical is among the latest companies sued so far this year in an unusual wave of 401(k) litigation.
That company, which was sued Aug. 26 in U.S. District Court in the Eastern District of Pennsylvania, is among more than 60 others facing new claims this year, according to an analysis by Bloomberg Law.
Leading in those new filings is law firm Capozzi Adler, which has filed at least 26 cases on behalf of clients, according to the Bloomberg report, including those in the case against B. Braun Medical.
At least some of the spike in new cases could be due to the COVID-19 crisis. According to an interview with law firm Shepherd, Finkelman, Miller & Shah in the Bloomberg report, inquiries about potential lawsuits have increased quickly, as “participants and retirees are at home and frankly are having more time to focus upon their retirement savings and be concerned about their retirement savings,” a lawyer at that firm said.
There were only about 20 401(k) lawsuits filed in all of 2019, according to Bloomberg’s analysis.
In the recent B. Braun Medical class-action lawsuit, four plan participants allege that the company breached its fiduciary duty by including unnecessarily expensive and underperforming investment options on the plan menu. Participants overpaid and lost out on potentially higher net returns to the tune of “millions of dollars,” according to the complaint.
That included not considering lower-cost share classes for certain investments, the complaint read. The plan switched from mutual funds to a lower-cost collective investment trust version of T. Rowe Price’s target-date series in 2019, although “this was too little, too late, as the damages suffered by plan participants to that point had already been baked in.”
The plan included nearly 6,400 participants as of 2018, representing more than $571 million in assets, according data from the Department of Labor.
B. Braun Medical declined to comment, citing a policy of not discussing pending litigation.
Law firm Capozzi Adler declined to comment beyond the information in court filings.
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As our second lead editor, Cindy Hamilton covers health, fitness and other wellness topics. She is also instrumental in making sure the content on the site is clear and accurate for our readers. Cindy received a BA and an MA from NYU.