U.S. Supreme Court Declines to Hear ERISA Case Involving Determination of Class

The U.S. Supreme Court recently announced that it will not decide whether the class was appropriately determined in Lockheed Martin v. Abbott.

In Lockheed Martin v. Abbott, 401(k) plan participants alleged, among other claims, that their plan’s stable value fund (SVF) was mismanaged because of its claimed excessive investment in money market funds. The participants proposed to base participation in the class action on whether a participant’s investment in the stable value fund underperformed compared to an outside index.

However, the Seventh Circuit Court of Appeals held that the reference to an outside index, the Hueler Index, when defining the class was permissible. The Court stated that the reference to the Hueler Index when defining the class did not bind the district court to use it for purposes of determining liability or damages. The Court indicated that the focus for purposes of defining the class is based on avoiding certification of classes where a significant portion of the class may have interests that are adverse to the class representative.

The plan fiduciaries asked the U.S. Supreme Court to review the 7th Circuit’s decision. However, the Supreme Court recently declined to hear the case.

ERIC members and trial members can read more here.