The Office for Civil Rights (“OCR”) at the Department of Health and Human Services (“HHS”) recently issued final regulations (“Reproductive Health Care Rule”) under the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) that narrow the permitted uses and disclosures of protected health information (“PHI”) in the context of an individual seeking, obtaining, providing or facilitating reproductive health care that is lawful under the circumstances provided. Plans and providers must comply with most of the new requirements (discussed below) by December 23, 2024 (240 days after t ..read more

They say that April showers bring May flowers, but there were no flowers for ERISA plan sponsors and fiduciaries on May 1 when the Second Circuit held, in a ruling that provoked a vigorous dissenting opinion, that an ERISA plan’s arbitration provision was not enforceable because it required the plan participant to forgo his statutory right to seek plan-wide relief. Cedeno v. Sasson, 2024 WL 1895053 (2d Cir. May 1, 2024). With this decision, the Second Circuit joins the Third, Seventh, and Tenth Circuits in holding unenforceable plan arbitration provisions on the ground that they prevent a plai ..read more

The Fifth Circuit recently reversed a district court’s dismissal of claims that the fiduciaries of a 401(k) plan breached the duty of prudence under ERISA by offering participants retail share classes instead of cheaper institutional share classes, and causing the plan to pay allegedly excessive recordkeeping fees.  The decision is notable for articulating the level of detail that may be sufficient in the Fifth Circuit for these kinds of claims to survive a motion to dismiss.  The case is Perkins v. United Surgical, No. 23-10375, 2024 WL 1574342 (5th Cir. Apr. 11, 2024). The District ..read more

On April 23, 2024, the Department of Labor (“DOL”) issued final rules which expand what it means to provide fiduciary “investment advice” under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”).  Though the final rules broaden the definition of “investment advice,” the circumstances under which advice will be covered are narrower than in the proposed rules released last year.  These final rules represent the potential culmination of the DOL’s battle since 2010 to expand the definiti ..read more

On April 16, 2024, IRS released Notice 2024-35 extending temporary relief for certain required minimum distributions (“RMD”) related to the SECURE Act’s 10-year distribution rule through 2024. This notice follows similar relief provided by the IRS in Notice 2022-53 and Notice 2023-54 for earlier periods. Background For distributions before January 1, 2020, the Internal Revenue Code required that an employee’s interest in a qualified plan either be distributed (1) within 5 years after the death of the employee (the “5-year rule”), or (2) over the life or life expectancy of the designated non-sp ..read more

A federal district court in Massachusetts dismissed ERISA fiduciary breach and prohibited transaction claims against 401(k) plan fiduciaries, ruling that the prohibited transaction claims were time-barred and the fiduciary breach claims—once limited by a settlement agreement in an earlier class action against MassMutual involving similar allegations (“Gordan”)—failed to plausibly state a claim.  The case is Lalonde v. Massachusetts Mutual Insurance Co., No. 22-cv-30147, 2024 WL 1346027 (D. Mass. Mar. 29, 2024). Plaintiff, a former employee of Massachusetts Mutual Insurance Co. (“MassMutua ..read more

On April 3, 2024, the U.S. Department of Labor (the “DOL”) published in the federal register a final amendment to Prohibited Transaction Class Exemption 84-14 (the “QPAM Exemption”) that makes considerable changes to the exemption’s conditions (the “Final Amendment”).   Although the Final Amendment trims back some of the more onerous requirements floated in the proposed amendment issued by the DOL in July 2022 (which we blogged about here) (the “Proposal”), the Final Amendment includes significant changes that will impact the QPAM Exemption including: Increasing the equity/net worth ..read more

A California district court recently denied a motion to dismiss claims that the fiduciaries of a 401(k) plan breached their ERISA fiduciary duties of prudence and loyalty by selecting underperforming, high-cost investments and causing the plan to pay excessive fees for services.  The decision is notable for illustrating how pleading standards in investment performance and excessive fee litigation vary depending on jurisdiction.  The case is Coppel v. Seaworld, No. 21-cv-1430 (S.D. Cal. Jan. 31, 2024). Background Participants in the 401(k) plan at issue commenced a putative class acti ..read more

The Departments of Labor, Treasury, and Health and Human Services (the “Departments”) recently issued guidance for group health plans outlining a “therapeutic equivalence” medical management technique for required preventive services coverage of contraceptives. The guidance, which was issued in the form of FAQs that can be downloaded here, builds on previous FAQs addressing required contraceptive coverage. How did we get here? By way of short background, the Affordable Care Act requires non-grandfathered group health plans to cover, without cost-sharing, certain preventive services and items w ..read more

Defense counsel frequently lament the difficulties of defending 401(k) investment and recordkeeping fee litigation when different judges render conflicting rulings on motions to dismiss seemingly indistinguishable complaints.  Even when the judges purport to apply the same legal standards, the outcomes can differ.  For that reason, we thought it would be interesting to track the decisions by a single judge in the Eastern District of Wisconsin who rendered five rulings in this arena within one week, in each case adopting the report and recommendation (“R&R”) of the same Magistrate ..read more