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

Recording of a 90-minute CLE webinar with Q&A


Conducted on Wednesday, August 9, 2017
Recorded event now available


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


Recordings

CLE On-Demand - Streaming Video

Includes recorded streaming video of full program plus PDF handouts.

On-demand is the only recorded format recognized for CLE credits in DE, IN, KS, LA, MS, NC, OH, OK, SC, TN, VA, WI.

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

*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

How does this work?


Recorded Event

Includes full event recording plus handouts.

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.)

Strafford will process CLE credit for one person on each recording.

Additional copies of a recording can be purchased at a discount. Please call Strafford Customer Service toll-free at 1-800-926-7926 ext 10 or email customerservice@straffordpub.com to place your order.

Recorded Webinar Download $297.00

How does this work?

Recorded Audio Download (MP3) $297.00

How does this work?


Webinar

Strafford webinars offer several options for participation: online viewing of speaker-controlled PowerPoint presentations with audio via computer speakers or via phone; or audio only via telephone (download speaker handouts prior to the program).  Please note that our webinars do not feature videos of the presenters.

Program Materials

Requires Adobe Reader 8 or later. Download Acrobat FREE.

Program Materials

Requires Adobe Reader 8 or later. Download Acrobat FREE.

or call 1-800-926-7926

CLE Credits

Many states grant CLE credits for on-demand streaming audio programs and recorded events. Our programs are pre-approved in many states. Refer to our state CLE map for state-specific information.

or call 1-800-926-7926

Customer Reviews

The program was very helpful and gave me a good overview.

Lauren Piana

Odin, Feldman & Pittleman

I appreciated the practical solutions to common problems.

Patricia Killian

McCarter & English

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

Nona Massengill

Williams Mullen

Strafford's on-line session was easy to attend and the topic was timely.

Jessica Lermond

Chartis Claims

Great overall summary of ERISA issues.

Shannon Awsumb

Anthony Ostlund Baer & Louwagie

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

Our Guarantee

Strafford webinars are backed by our 100% Unconditional Money-Back Guarantee: if you are not satisfied with any of our products, simply let us know and get a full refund. For more information regarding complaints and refunds, please contact us at 1-800-926-7926 ext 10. Complaints regarding this program can be submitted via the course evaluation found in the “Thank you” e-mail at the end of the course.