Proprietary Funds in 401(k) and Retirement Plans: A View From the Trenches

Navigating Prohibited Transaction Rules, Fiduciary Duties, and the Recent Surge in DOL Investigations and Civil Litigation

A live 90-minute CLE webinar with interactive Q&A


Wednesday, August 9, 2017
1:00pm-2:30pm EDT, 10:00am-11:30am PDT


This CLE webinar will discuss the legal issues arising from the offering of proprietary or affiliated products in ERISA-covered retirement plans sponsored by financial services companies. The panel will discuss the rise in regulatory and litigation challenges to proprietary funds, and explain how plan sponsors and fiduciaries can avoid or mitigate the additional risk these offerings create.

Description

Financial services companies typically offer their own products—mutual funds, insurance contracts, collective trusts—to their employees in their company-sponsored 401(k) and retirement plans. These proprietary, or affiliated, products can create additional risks for sponsors and fiduciaries and raise complicated issues under ERISA’s prohibited transaction and fiduciary rules.

These complex issues have recently moved front and center in both the regulatory and litigation arenas as private plaintiffs and the government challenge the prudence and performance of these investments and associated fees and expenses. These challenges raise the specter of a finding of imprudence related to a sponsor’s own products that are marketed to the sponsor’s customers, an unenviable situation that can expose a plan sponsor to costly litigation or regulatory action.

Listen as our experienced panel of ERISA attorneys discusses the legal issues that can arise from the offering of proprietary or affiliated products in ERISA-covered retirement plans sponsored by financial services companies. The panel will discuss the rise in regulatory and litigation challenges to proprietary funds and explain how plan sponsors and fiduciaries can avoid or mitigate the additional risk these offerings create.

Outline

  1. Prohibited Transaction Exemption PTE 77-3 and the residual duties of prudence and loyalty
  2. Related problems of 12b-1 fees and sales commissions
  3. Problems with “seeding” newly established proprietary products
  4. DOL investigative initiative and the surge in class action complaints
  5. Strategies for reducing litigation risk

Benefits

The panel will review these and other key issues:

  • What are the peculiar problems associated with the offering of proprietary funds, and the varied—and peculiar—legal standards governing their use?
  • How might a finding of a fiduciary breach impact the sponsor’s business model?
  • What steps can be taken to avoid problems before they erupt into a DOL investigation and/or an ERISA class action?

Faculty

Jeremy P. Blumenfeld, Partner
Morgan Lewis & Bockius, Philadelphia

Mr. Blumenfeld represents defendants on a range of employee benefit litigation matters, including numerous ERISA class actions. Co-chair of the firm’s ERISA litigation practice, Jeremy’s experience includes defending class action claims challenging the administration of 401(k) savings plans, stock drop litigation involving 401(k) savings plans, cash balance and other defined benefit plans, and employee stock ownership plans (ESOPs) and traditional severance pay plans. He also advises clients on litigation and risk avoidance.

Brian T. Ortelere, Partner
Morgan Lewis & Bockius, Philadelphia

Mr. Ortelere is a Partner in the New York and Philadelphia offices, and is Co-Chair of the ERISA Litigation Practice at Morgan Lewis.  His practice covers the full range of employee benefit defense litigation matters, including every variety of ERISA class action.  He has particular expertise in defending class claims challenging the administration of defined benefit pension plans, 401(k) and 403(b) savings plans and ESOPs, and has abundant experience in representing fiduciaries and plan service providers in governmental investigations related to benefit plans.  Along with the ERISA Litigation Practice he co-chairs, Mr. Ortelere is ranked in the top three ERISA litigators nationwide by Chambers and Partners


Live Webinar

Live Webinar $297.00

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This webinar is eligible for at least 1.5 general CLE credits.

CLE credits are not available for PR.

*In KS, OH, PA, for more than 1 attendee on the connection you must contact Strafford CLE via email or call 1-800-926-7926 ext. 35 prior to the program for special instructions.


Recordings

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*Only available for attorneys admitted for more than two years. For OH CLE credits, only programs recorded within the current calendar year are eligible - contact the CLE department for verification.

**NH attendees must self-determine if a program is eligible for credit and self-report their attendance.

CLE On-Demand Video $297.00
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Strafford is an approved provider and self-study CLE credit is available in most states.

AK, AZ, CA, CO, CT, FL, GA, HI, IA, ID, IL, KY, ME, MN, MO, MT, ND, NJ, NM, NY, OR, PA, TN, TX, UT, VT, WA, WV, WY (Note: Some states restrict CLE eligibility based on the age of a program. Refer to our state CLE Map for additional information.)

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Webinar

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Customer Reviews

The PowerPoint presentation made things easy to understand.

Ian Weinberger

The Lambos Firm

Great overall summary of ERISA issues.

Shannon Awsumb

Anthony Ostlund Baer & Louwagie

Good materials plus well prepared presenters and a good level of detail.

John H. Merkle

Fredrikson & Byron

The best seminar I have attended on this topic! The speakers did an outstanding job making the topic understandable. 

Craig Kovarik

Husch Blackwel

The webinar addressed exactly what I needed for this area of my practice. Very useful information and very impressive program.

Nona Massengill

Williams Mullen

or call 1-800-926-7926

Employment & ERISA Advisory Board

Susan E. Bernstein

Special Counsel

Schulte Roth & Zabel

Judith (Jude) Biggs

Partner

Holland & Hart

Joshua Davis

Director

Goulston & Storrs

Barbara E. Hoey

Partner

Kelley Drye

Jeffrey Hollingsworth

Partner

Perkins Coie

Diana L. Hoover

Partner

Hoover Kernell

Paul J. Kennedy

Shareholder

Littler Mendelson

Marcia Nelson Jackson

Partner

Wick Phillips

William C. Martucci

Partner

Shook Hardy & Bacon

Laura Foote Reiff

Shareholder

Greenberg Traurig

Eugene Scalia

Partner

Gibson Dunn & Crutcher

Peter Steinmeyer

Member

Epstein Becker & Green

Teresa R. Tracy

Partner

Freeman Freeman Smiley

Todd D. Wozniak

Shareholder

Greenberg Traurig

or call 1-800-926-7926

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