Supreme Court Considers Whether ERISA Fiduciaries May Be Liable for Damages to an Individual Participant’s Account
In connection with yesterday's argument in LaRue v. DeWolff, Boberg & Assoc., Inc., Docket No. 06-856 (U.S.), the Supreme is considering whether a 401(k) plan participant can bring an action to recover damages for a breach of fiduciary duty that resulted in a loss solely to an individual plan account. Justices Souter, Ginsburg and Breyer appeared to support such actions, while Chief Justice Roberts and Justice Scalia suggested that alternative avenues were perhaps better suited for the relief sought by Petitioner. The resolution of this case may determine the viability of the ERISA-based "stock drop cases," which frequently accompany federal securities fraud actions and are brought on behalf of a subset of 401(k) plan participants.
To view a transcript of the oral argument before the Supreme Court of the United States in LaRue v. DeWolff, Boberg & Assoc., Inc., please click here.