Fiduciary Liability

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Daniel Aronowitz

On June 28, 2024, the U.S. Supreme Court issued its decision in Loper Bright Enterprises v. Raimondo, in which the court overruled the so-called Chevron doctrine, pursuant to which courts had deferred to agency interpretations of ambiguous statutes. In the following guest post, Daniel Aronowitz, President of Encore [formerly Euclid] Fiduciary, provides his views of the Court’s decision in the Loper Bright Enterprises case and discusses its implications. A version of this article previously was published on Encore Fiduciary’s Fid Guru blog. I would like to thank Dan for allowing me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is Dan’s article.Continue Reading Guest Post: The Overreaction to the End of Chevron Deference

Dan Aronowitz

Many of you may have seen the February 5, 2024 Wall Street Journal article (here) describing the new lawsuit filed against Johnson & Johnson accusing the company of mismanaging its workers’ prescription-drug benefits. The new complaint, a copy of which can be found here, arguably represents a new direction in ERISA liability litigation, perhaps the next big thing after all of the ERISA excess fee litigation. In the following guest post, Dan Aronowitz, President of Encore [formerly Euclid] Fiduciary, examines the new lawsuit and assesses what it may represent. He also considers the company’s defenses as well as the need for a vigorous response to lawsuits of this kind. A version of this article previously was published on the Fid Guru Blog. I would like to thank Dan for allowing me to publish his article on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is Dan’s article.Continue Reading Guest Post: Flipping the Script on the New Excess Health Plan Fee Case Against Johnson & Johnson

According to a new report, the number of excess fee and performance lawsuits filed in 2023 declined relative to the extraordinary filings levels in 2022, but excess fee lawsuit filings remained elevated. By contrast to prior years in which plaintiffs’ lawyers seemingly targeted benefit plans of all sizes, in 2023 the excess benefit plan lawsuits filed in 2023 primarily targeted companies with larger benefit plans. The number and aggregate total value of excess fee lawsuit settlements in 2023 was a record levels during the year. The January 8, 2024, report about the excess fee lawsuit filings, written by Daniel Aronowitz of Euclid Specialty, can be found here.Continue Reading Excess Fee Lawsuit Filings Declined in 2023 Due to Backlog of Prior Cases

Daniel Aronowitz

On January 24, 2022, the U.S. Supreme Court issued its much-anticipated decision in the Hughes v. Northwestern University case (here) of potentially significant importance both for excess fee litigation and to the fiduciary liability insurance market. In the following guest post, Daniel Aronowitz, Owner and Managing Principal of Euclid Fiduciary, a fiduciary liability insurance underwriting company, reviews the decision and discusses its implications. I would like to thank Dan for allowing me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Dan’s article.
Continue Reading Bad Facts Make Bad Law – Lessons from the Northwestern Decision

Larry Fine

As I noted in a recent post, there recently has been an increase in excessive fee litigation against plan fiduciaries. In the following guest post, Larry Fine takes a look at recent developments in excessive fee litigation, and the implications for the fiduciary liability insurance industry. Larry is the Management Liability Coverage Leader at Willis Towers Watson. I would like to thank Larry for allowing me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Larry’s article.
Continue Reading Guest Post: Excessive Fees, Excessive Fiduciary Litigation: A Balanced Look

The filing of excessive fee litigation against plan fiduciaries is nothing new. However, according to a recent white paper, this type of litigation has entered a dangerous new phase, characterized by both heightened frequency and severity and affecting companies of all sizes. In this new phase, the risk of litigation has, according to the report, reached “unprecedented levels.” A copy of the report, written by Allison Barrett and Joel Townsend of AIG and entitled “Fiduciary Liability Insurance: Understanding the Rapid Rise of Excessive Fee Claims,” can be found here.
Continue Reading A New Wave of Excessive Fee Fiduciary Liability Litigation

As I have noted in prior posts (most recently here), an important concern these days for insurance industry observers and commentators is “silent cyber” — that is, the coverage for cyber-related losses under traditional property and casualty insurance policies, as opposed to purpose-built cyber insurance policies. For example, in one recent case (discussed here), a court found coverage for cyber losses under a business owner’s policy. While the possibility for finding cyber coverage under several other types of coverage is frequently discussed, one line of coverage that is not frequently considered is fiduciary liability coverage. However, a recent lawsuit, in which a corporate benefits plan participant lost funds to a cyber thief, suggests a way in which a cyber loss potentially could trigger a fiduciary liability policy.
Continue Reading “Silent Cyber” and Fiduciary Liability Claims

Rhonda Prussack

The last couple of years have seen a wave of ERISA suits aimed at 401(k) plan sponsors and targeting plan fees. In the following guest post, Rhonda Prussack, Head of Fiduciary and Employment Practices Liability at Berkshire Hathaway Specialty Insurance, takes a look at this phenomenon and the factors behind it, as well as the fiduciary liability insurers’ reaction to these developments. I would like to thank Rhonda for allowing me to publish her article on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is Rhonda’s guest post.
Continue Reading Guest Post: Surge in ERISA Fee Litigation