Litigation and Alternative Dispute Resolution

Fourth Circuit Rules That Retirement Plan Trustees’ Failures Must Have Causal Link to Plan Losses In Order to Hold Trustees Liable: Plasterers’ Local Union No 96 Pension Plan v. Pepper, No. 10-1364

By: Mark S. Thomas & Robert W. Shaw
Williams Mullen (North Carolina and Virginia, USA)

The U. S. Court of Appeals for the Fourth Circuit has ruled that retirement plan trustees cannot be held liable for failures to investigate the prudence of plan investments or to diversify those investments,

unless there is a proven causal link between such fiduciary failures and losses to the retirement plan.  The court’s decision in Plasterers Local Union No. 96 v. Pepper, No. 10-1364 (4th Cir. December 1, 2011), vacated a judgment for the current trustees of the retirement plan and remanded the case for further proceedings, with clear guidance on the crucial issue of liability. Click here to read entire Article.

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