ERISA Breach of Fiduciary Duty Claims in Washington DC

Employee benefits offered by employers in Washington DC are protected by a federal law referred to as ERISA, which stands for the Employee Retirement Income Security Act of 1974.

While this law does not require employers to provide benefits such as pension plans and healthcare packages, when they do provide these benefits, ERISA imposes certain standards, including a fiduciary duty to manage plan resources responsibly.

When plan administrators fail to fulfill their duties and beneficiaries suffer a loss, they often file ERISA breach of fiduciary duty claims in Washington DC to obtain compensation for those losses.

Who Owes a Fiduciary Duty Under ERISA

In simple terms, a fiduciary duty legally obligates one person (known as the fiduciary) to act in the best interests of another person, often referred to as the beneficiary.  ERISA imposes a fiduciary duty in several parties connected with the assets of benefit plans. These include:

  • People or entities who hold authority or exercise control over management or assets of the plan
  • People or entities with authority or responsibility for administering the plan
  • People or entities that are paid to provide advice on investing plan assets
  • People or entities with the authority or responsibility to provide investment advice

Examples include plan administrators, trustees, and investment committee members.

Specific Fiduciary Duties Imposed by ERISA

As fiduciaries, the plan administrators and advisers have a duty to run the benefit plans with the sole purpose of benefitting participants in the plans. They are supposed to focus on managing the plan so that it is able to provide benefits and pay plan expenses.

To do so, they are expected to make prudent decisions, including diversifying plan investments so as to reduce the risk of suffering unnecessarily large losses.

Another responsibility of the fiduciaries is to follow procedures and terms set forth in the plan documents, so long as these terms comply with the requirements of ERISA.

One of the most important fiduciary duties of administrators, and one that often leads to a claims for breach of duty, is the obligation to avoid conflict of interest.  Fiduciaries must refrain from taking actions that benefit certain other parties such as the plan sponsor, service providers, or other fiduciaries.

When Fiduciary Duties Are Breached

If fiduciaries fail to follow the principles of conduct required by ERISA, they may be held personally liable for losses suffered by the plan, and by extension, the beneficiaries. They may also be required to return profits they made by using plan assets improperly.

Beneficiaries usually file a class action lawsuit for breach of fiduciary duty, and courts may take whatever action they deem appropriate against administrators and others who are found to have breached their fiduciary duties under ERISA, including removing administrators from positions of authority.

Because losses are suffered by all beneficiaries of a plan, it is often necessary to certify the beneficiaries as a class before proceeding with a lawsuit for breach of fiduciary duty in federal court in Washington.

Help with Filing ERISA Breach of Fiduciary Duty Claims in Washington

ERISA lawsuits are generally handled by attorneys with experience litigating in the federal courts, particularly when it comes to filing class action claims.

When beneficiaries of an employee benefit plan believe assets may have been mismanaged and they have suffered loss as a result, it may be advisable to consult knowledgeable ERISA lawyers who can evaluate the situation and file ERISA breach of fiduciary duty claims in Washington DC on their behalf as necessary to protect plan assets.