The DOL Promulgates the Final Fiduciary Regulation

By Joseph A. Garofolo

On April 8, 2016, the Department of Labor promulgated a final regulation regarding ERISA’s definition of fiduciary.  The final regulation becomes applicable on April 10, 2017, and is available here.  

There were a number of changes between the proposed regulation published on April 20, 2015 and the final regulation.  The Department provided a chart summarizing changes made in response to the following issues raised in connection with the proposed regulation: the distinction between education and investment advice, the applicability of the regulation to health and welfare arrangements and appraisals, whether “hire me” recommendations are subject to ERISA’s fiduciary standards, the applicability of the Best Interest Contract Exemption (the “BICE”) (a class prohibited transaction exemption) to small plans and all asset classes, disclosure requirements under the BICE, the applicability of the contract requirement to ERISA plans and arrangements not subject to ERISA (including individual retirement accounts “IRAs”), the application of the regulation to call centers, web disclosure and data retention requirements, recommendations relating to proprietary products, lifetime income products, and level fee arrangements, fee-based account conversions, bias toward products with low fees, grandfather relief, and concerns regarding regulation implementation.  The Department’s chart is available here.

Finally,  on April 8, 2016, the Department promulgated the following exemptions relating to prohibited transactions under ERISA and the Internal Revenue Code of 1986, as amended: i) the BICE (the Best Interest Contract Exemption); ii) Class Exemption for Principal Transactions in Certain Assets Between Investment Advice Fiduciaries and Employee Benefit Plans and IRAs; iii) Amendment to Prohibited Transaction Exemption (PTE) 75-1, Part V, Exemptions From Prohibitions Respecting Certain Classes of Transactions Involving Employee Benefit Plans and Certain Broker-Dealers, Reporting Dealers and Banks; iv) Amendment to and Partial Revocation of Prohibited Transaction Exemption (PTE) 86-128 for Securities Transactions Involving Employee Benefit Plans and Broker-Dealers; Amendment to and Partial Revocation of PTE 75-1, Exemptions From Prohibitions Respecting Certain Classes of Transactions Involving Employee Benefits Plans and Certain Broker-Dealers, Reporting Dealers and Banks; v)
Amendments to Class Exemptions 75-1, 77-4, 80-83 and 83-1; and vi) Amendment to and Partial Revocation of Prohibited Transaction Exemption (PTE) 84-24 for Certain Transactions Involving Insurance Agents and Brokers, Pension Consultants, Insurance Companies, and Investment Company Principal Underwriters.  These documents can be accessed here.

While the retirement plan community continues to analyze the final regulation and its related exemptions, it is safe to say that many investment advisers and participants will be affected by the significant changes made to the Department’s interpretation of “investment advice” as that phrase is used in ERISA § 3(21)(A)(ii).  

Research Reveals Disparities Between Disability Claims and Other Types of Benefits Litigation

By Joseph A. Garofolo

The Department of Labor recently cited ERISA Benefits Litigation: An Empirical Picture, 28 ABA J. Lab. & Emp. L. 1 (2012) (“ERISA Benefits”), in its proposed regulation regarding disability benefit plan claims procedures.  See 80 Fed. Reg. 72014, 72016 n.8 (Nov. 18, 2015).  ERISA Benefits is a study by Sean M. Anderson, a professor at the University of Illinois College of Law, that most ERISA practitioners—regardless of whether they focus on disability claims—will find fascinating.

Professor Anderson analyzed data relating to ERISA benefits lawsuits filed between 2006 and 2010.  He found that disability suits accounted for 64.5% of benefits litigation whereas lawsuits involving health care plans and pension plans accounted for only 14.4% and 9.3%, respectively.  ERISA Benefits at 7.  According to the study, defendants asserted failure to exhaust in 27.8% to 40.4% of lawsuits in which disability benefits were not involved.  Id. at 11.  In contrast, failure to exhaust was asserted as a defense in only 14.7% of the disability cases.  Id.  

Professor Anderson has indicated that he intends to further analyze the data that he has collected.  The author believes that analysis of class action benefits litigation, claims brought by providers where numerous medical claims are litigated in a single lawsuit (often brought by providers), and the amount of monetary recovery sought in different types of benefits claims would be of interest to ERISA practitioners and policymakers.

401(k) Plan Investors Should Take Notice of Recent Report on Concentrated Stock Risk

By Joseph A. Garofolo

Although not everyone agrees about the value of diversification, 401(k) investors would be wise to take notice of a J.P. Morgan report relating to concentrated stock risk.  See Michael Cembalest, The Agony and the Ecstasy: The Risk and Rewards of a Concentrated Stock Position, Eye on the Market Special Edition, J.P. Morgan (2014).  The J.P. Morgan report highlights how risky investing in even large companies can be and emphasizes the risk that investors take when they fail to diversify. 

According to the J.P. Morgan report, 40% of all stocks that had been a part of the Russell 3000 suffered a catastrophic loss from 1980 to 2014.  Catastrophic loss was defined as “a decline of 70% or more in the price of a stock from its peak, after which there was little recovery such that the eventual loss from the peak is 60% or more.”  Id. at 4.

The report also makes clear that even the largest public companies were not immune to large losses—since 1980, 320 companies have been deleted from the S&P 500 due to significant distress.  The 320 “deletions . . . were a consequence of stocks that failed outright, were removed due to substantial declines in their market value, or were acquired after suffering such a decline.”  Id. at 3.

The report identifies 10 factors, including government policy changes, that are outside of company control.  And it concludes with the following:  “The factors outside management control . . . are a formidable list, and have grown in complexity since we first drafted this report 10 years ago.  This is perhaps the most important epiphany we gained from the study: that exogenous forces may overwhelm the things we can control.”  Id. at 36 (emphasis omitted).

The J.P. Morgan report serves as a good reminder of the importance that 401(k) plan participants should place on modern portfolio theory and its emphasis on diversification.

Expert Testimony Regarding the ERISA Fiduciary Standard of Care

By Joseph A. Garofolo

Courts regularly allow ERISA expert testimony relating to the fiduciary standard of care, especially in complex cases.  See, e.g., In re Reliant Energy ERISA Litig., 2005 U.S. Dist. LEXIS 48034, at *3, *7-*8 (S.D. Tex. Aug. 19, 2005); Smith v. Sydnor, 2000 U.S. Dist. LEXIS 20074, at *57-*58 (E.D. Va. Aug. 25, 2000); Flanigan v. GE, 93 F. Supp. 2d 236, 242-243 (D. Conn. 2000).  As explained by one court when rejecting an effort to exclude testimony that an ERISA fiduciary breached its duties, “expert witnesses, in all types of litigation, render an opinion as to what the applicable standard of care is and whether it has been complied with.”  Harris v. Koenig, 2011 U.S. Dist. LEXIS 51860, at *6 (D.D.C. May 16, 2011).

Moreover, the vast majority of ERISA fiduciary breach cases are heard by a judge.  And courts in most federal circuits have recognized that there is a relaxed standard for admissibility of expert testimony in bench trials.  See, e.g., United States v. Wood, 741 F.3d 417, 425 (4th Cir. 2013); David E. Watson, P.C. v. United States, 668 F.3d 1008, 1015 (8th Cir. 2012); Att’y Gen. of Okla. v. Tyson Foods, Inc., 565 F.3d 769, 779 (10th Cir. 2009); United States v. Brown, 415 F.3d 1257, 1268 (11th Cir. 2005); Deal v. Hamilton Cnty. Bd. of Educ., 392 F.3d 840, 852 (6th Cir. 2004); Serby v. First Alert, Inc., 2015 U.S. Dist. LEXIS 95612, at *3 (E.D.N.Y. July 22, 2015); Wolkowitz v. Lerner, 2008 U.S. Dist. LEXIS 34698, at *5 (C.D. Cal. Apr. 21, 2008).

Thus, in addition to the fact that fiduciary breach cases are often complex, there is a significant likelihood that competing expert testimony will be heard by a judge in ERISA cases, including litigation involving 401(k) plans and employee stock ownership plans.




Designation of a Named Fiduciary

By Joseph A. Garofolo

ERISA §§ 402(a)(1) and (2) require a plan to designate, or provide a procedure for designating, one or more named fiduciaries “who jointly or severally shall have authority to control and manage the operation and administration of the plan.”  The designation of a named fiduciary or fiduciaries can become important in 401(k) plan fiduciary breach and other ERISA litigation because it effectively forecloses the person or persons so designated from arguing that they are not fiduciaries with attendant duties.

But how specific does the designation of a named fiduciary have to be?

Fortunately, the Department of Labor provided early interpretive guidance, now codified in 29 C.F.R. § 2509.75-5, relating to this issue.  This guidance, issued in 1975, answers three basic questions relating to the designation of named fiduciaries.

First, the Department indicated yes in response to the question of whether the designation of a committee by position or by individual satisfies the requirements of ERISA § 402(a).

Second, with regard to a collectively bargained plan, the Department explained that ERISA § 402(a) is satisfied if a “joint board is clearly identified as the entity which has authority to control and manage the operation and administration of the plan.”  29 C.F.R. § 2509.75-5, FR-2.  The Department continued that each member of the joint board would be a named fiduciary under such a situation.

And, third, the Department confirmed that a plan may name a corporation/plan sponsor as the named fiduciary.  The Department indicated that the plan instrument designating the corporation “should provide for designation by the corporation of specified individuals or other persons to carry out specified fiduciary responsibilities under the plan, in accordance with section 405(c)(1)(B) of the Act.”  29 C.F.R. § 2509.75-5, FR-3.

Early Department of Labor interpretative guidance is often a good place to start when seeking clarification regarding fundamental fiduciary responsibilities.   




ERISA’s Fiduciary Duty to Monitor

By Joseph A. Garofolo

In Tibble v. Edison International, 135 S. Ct. 1823 (2015), the Supreme Court clarified the applicability of ERISA’s statute of limitations to the fiduciary duty to monitor.  The plaintiffs alleged that fiduciaries violated the duty to monitor investments by continuing to offer retail-class mutual funds to 401(k) plan participants as opposed to institutional-class funds with lower fees.  The Court held “that the duty of prudence involves a continuing duty to monitor investments and remove imprudent ones” and that a breach of the duty to monitor occurring within ERISA’s statute of limitations was sufficient to hold that plaintiffs’ fiduciary breach claims were not time barred.  Id. at 1829.

While Tibble involved the duty to monitor 401(k) plan investments, another important fiduciary duty to monitor exists with regard to the appointment of plan fiduciaries and the selection of service providers to plans.  The Department of Labor has explained the following:

At reasonable intervals[,] the performance of trustees and other fiduciaries should be reviewed by the appointing fiduciary in such manner as may be reasonably expected to ensure that their performance has been in compliance with the terms of the plan and statutory standards, and satisfies the needs of the plan.  No single procedure will be appropriate in all cases; the procedure adopted may vary in accordance with the nature of the plan and other facts and circumstances relevant to the choice of the procedure.

 29 C.F.R. § 2509.75-8, FR-17.

The Department has made it clear that the “reasonable intervals” standard also applies to monitoring plan service providers.  See

Notably, the duty to monitor is part of a fiduciary’s obligations under ERISA § 404(a)(1).  Indeed, consistent with the Supreme Court’s analysis in Tibble, some courts have held that it is part of the duty of prudence.  However, the duty to monitor should not be confused with co-fiduciary duties under ERISA § 405(a)—that section requires the elements of one of its subsections (e.g., knowledge of a fiduciary breach by another without making reasonable remedial efforts) whereas those elements are not required to be satisfied in order for a breach of ERISA § 404(a)(1) to occur.

Notwithstanding the difference between the duty to monitor and co-fiduciary duties, it is critical for fiduciaries to understand both, as ERISA is not forgiving to fiduciaries who are unware of their responsibilities.


Latest Developments Regarding the Proposed Fiduciary Regulation

By Joseph A. Garofolo

March has already delivered several noteworthy developments regarding the proposed fiduciary rule.  By way of background, the Department of Labor sent a proposed rule regarding the definition of fiduciary to the Office of Management and Budget (“OMB”) on February 23, 2015.  Although the proposed rule has not been made public yet, the Department provided a glimpse of what it might look like in frequently asked questions available on the Department’s website.  For example, the Department indicates that it is seeking “a balanced approach that . . . ensures that [investment] advisers provide advice in their client’s best interest, and also minimizes any potential disruptions to all the good advice in the market.”  Further, the Department states that the proposed rule “will not prohibit common compensation practices, such as commissions and revenue sharing[,]” and will include proposed exemptions to restrictions under ERISA and the Internal Revenue Code (the “Code”).  Review by OMB is a first step and will be followed by the notice-and-comment process under the Administrative Procedure Act.

As to the new developments, first, nine Republican members of the U.S. Senate Committee on Health, Education, Labor, and Pensions signed a March 10, 2015 letter to the OMB Director generally expressing concern that the proposed rule will be similar to the 2010 proposed rule that was withdrawn by the Department in 2011.  The letter requests that OMB consider 11 specific concerns of the Senators.  Most of the concerns revolve around perceived failures of the Department to coordinate with the Securities and Exchange Commission (“SEC”) and other agencies and the possibility that the proposed rule could increase the cost of investment-related services or reduce the availability of such services to ERISA plans and individual retirement accounts (“IRAs”).  The letter is available here.

Second, Secretary of Labor Thomas Perez was questioned about the proposed fiduciary rule during a March 17, 2015 budget hearing before the U.S. House of Representatives Committee on Appropriations Subcommittee on Labor, Health and Human Services, Education and Related Agencies.  Republican Hal Rogers, the Chairman of the Committee on Appropriations, asked Secretary Perez “how ERISA gives DOL jurisdiction over an individual’s relationship with a personal investment advisor.”  In response, Secretary Perez briefly explained the roles of the Department and the SEC and referenced a letter that he had sent the previous day responding to an inquiry from the Chairman of the House Committee on Education and the Workforce.  Secretary Perez also stated that “the law gives DOL the authority to define a fiduciary under the tax laws in the same way as the ERISA definition.”  He further indicated that he has been involved in eight or nine meetings with SEC Chairwoman Mary Jo White relating to the proposed fiduciary rule.  A video of the hearing currently is available here (the dialogue between Chairman Rogers and Secretary Perez starts at approximately 1:21:52).

The discussion during the budget hearing highlights the potential scope of the proposed fiduciary rule and the impact that it could have not only on 401(k) and other employer-sponsored plans, but also IRAs.  The 2010 proposed regulation would have amended the definition of fiduciary for purposes of ERISA and the excise tax on prohibited transactions under Code § 4975.  Code § 4975 applies to IRAs and contains a definition of fiduciary parallel to the one found in ERISA § 3(21)(A).

Finally, several sources, including PLANSPONSOR and the American Retirement Association, are reporting that on March 17, 2015, Chairwoman White stated that the SEC will “implement a uniform fiduciary duty for broker-dealers and investment advisors where the standard is to act in the best interest of the investor.”

While the extent of further interaction between the Department of Labor and the SEC and the ultimate fate of the proposed fiduciary rule remain uncertain, it appears quite likely that the discourse surrounding the proposed rule will continue to be politically charged.

Is Williston on Contracts The Sacred Text for Interpretation of ERISA Plans?

By Joseph A. Garofolo

Earlier this year, the Supreme Court emphasized that collective bargaining agreements establishing ERISA welfare plans generally must be construed in accordance with ordinary principles of contract interpretation.  See M&G Polymers USA, LLC v. Tackett, 135 S. Ct. 926 (2015).   The Court rejected the Sixth Circuit’s inferences in favor of vesting of retiree health care benefits outlined in International Union, United Auto, Aerospace, & Agricultural Implement Workers of America v. Yard-Man, Inc., 716 F.2d 1476, 1479 (6th Cir. 1983).  Counting the concurring opinion, the Court cited Williston on Contracts no less than seven times when describing ordinary principles of contract interpretation.  See Tackett, 135 S. Ct. at 933, 935-938 (citing R. Lord, Williston on Contracts (4th ed. 2008 & 2012)).  The majority also cited Williston on Contracts in US Airways, Inc. v. McCutchen, 133 S. Ct. 1537, 1549 (2013), and Justice Scalia cited the treatise in his concurrence in Cigna Corp. v. Amara, 131 S. Ct. 1866, 1884 (2011).

ERISA practitioners familiar with the Supreme Court’s interpretive history of the phrase “other appropriate equitable relief,” as used in ERISA § 502(a)(3), will recall the Court’s frequent references to the Restatement of Trusts, Bogert & Bogert’s Law of Trusts and Trustees, and Scott & Fratcher’s Law of Trusts (now Scott & Ascher on Trusts), sometimes referred to as The Sacred Texts.  See Jacklyn Willie, Attorneys Reflect on 40 Years of ERISA’s Biggest Rulings, Bloomberg BNA Pension & Benefits Daily, Sept. 9, 2014, at 2.

In light of the Court’s recent decisions, Williston on Contracts might be viewed as The Sacred Text when it comes to benefit plan interpretation.  But this is by no means a foregone conclusion.  The Supreme Court has characterized Corbin on Contracts as a “standard current work[].”  Great-West Life Annuity Ins. Co. v. Knudson, 534 U.S. 204, 217 (2002).  Indeed, in Tackett, 135 S. Ct. at 936, the Court also cited Corbin on Contracts.  Of course, Arthur Corbin and Samuel Williston famously disagreed on a number of fundamental principles relating to contractual interpretation, such as the proper application of the parol evidence rule.  See Eric A. Posner, The Parol Evidence Rule, the Plain Meaning Rule, and the Principles of Contractual Interpretation, 146 U. Pa. L. Rev. 533, 568-69 (1998).  

Moreover, “for the last few decades the academic literature has not taken Williston’s jurisprudence all that seriously.”  Mark L. Movsesian, Rediscovering Williston, 62 Wash. & Lee L. Rev. 207, 209 (2005).  While Mark Movsesian, a contracts professor at St. John’s University School of Law, concluded in 2005—perhaps presciently in the case of the Supreme Court’s recent ERISA jurisprudence—that there had been a resurgence of interest in Williston’s work, he also explained the following:

The cite count is high, but scholars have tended to look to Williston only in passing, referencing him when they have needed a source for some black-letter proposition or some point of legal history.  In part, this indifference stems from the fact that most of Williston’s work is of a doctrinal and case-oriented style that has fallen out of vogue. . . . Over time, the conventional wisdom has lumped Williston together with the great villains of contemporary jurisprudence, the classical formalists, portraying him as a mindless reactionary obsessed with logic and conceptual abstraction.

Id. at 209-210.

Elaborating upon what some perceive to be failings of Williston’s work, Professor Movsesian pointed out that Harvard Law Professor Morton Horwitz has asserted that “Williston’s objective theory of contract acts to ‘disguise gross disparities of bargaining power under a facade of neutral and formal rules.'”  Id. at 226 (citation omitted).

Back to the realm of ERISA, in Tackett, the Supreme Court suggested that it would not be appropriate to apply ordinary contract law principles when such principles are “inconsistent with federal labor policy.”  135 S. Ct. at 933.  And, in addition to the fact that ERISA expressly states that one of its purposes is to protect the interests of participants and beneficiaries, some commentators have contended that ERISA plans are adhesion contracts.  See, e.g., John H. Langbein, Trust Law as Regulatory Law: The Unum/Provident Scandal and Judicial Review of Benefit Denials Under ERISA, 101 Nw. U. L. Rev. 1315, 1323 (2007) (“ERISA benefit plans are characteristic contracts of adhesion, offered on a take-the-plan-or-leave-the-job basis.”).

Thus, it is unclear whether all of the principles of contractual interpretation associated with Samuel Williston are consistent with the “special nature and purpose of employee benefit plans.”  Varity Corp. v. Howe, 516 U.S. 489, 497 (1997).

Because ERISA cases frequently involve disputes over benefit plan interpretation, we will likely have the opportunity to observe whether the Court will continue to rely upon Williston on Contracts to articulate ordinary principles of contract interpretation.  If this turns out to be the case, considering the fact that the treatise currently consists of 31 volumes, there is certainly plenty of material for the Court to draw from in framing the “ordinary contract principles” that must be applied to employee benefit plans.

Proposed $62 Million Settlement Submitted for Approval in Lockheed 401(k) Excessive Fee Litigation

By Joseph A. Garofolo

On February 20, 2015, the parties in Abbott, et al. v. Lockheed Martin Corporation, et al., No. 06-cv-701-MJR-DGW, filed their joint motion for preliminary approval of a class action settlement.  Plaintiffs’ counsel touted the proposed settlement as the “the largest ever for a case of this nature.”  (Plaintiffs’ Memorandum in Support of Joint Motion for Preliminary Approval of Settlement at 1).

The lawsuit, pending in the United States District Court for the Southern District of Illinois, alleges fiduciary breaches of ERISA and prohibited transactions relating to fees and expenses paid from assets of two 401(k) plans sponsored by Lockheed Martin.  The suit also asserts that plan fiduciaries improperly managed company stock funds and a stable value fund.

If approved by the court, defendants would pay $62 million into a settlement account.  In addition, defendants have agreed to, inter alia, implement competitive bidding for recordkeeping services provided to the plans and to offer plan participants investment share classes with the lowest expense ratio with certain caveats.

Based on the plaintiffs’ briefing in support of the joint motion, class counsel will request not more than one-third ($20,666,667) of the $62 million cash settlement fund and costs of not more than $1,850,000.

The terms of the proposed settlement will be reviewed by an independent fiduciary pursuant to Department of Labor Prohibited Transaction Class Exemption 2003-39.

The lawsuit was commenced more than eight years ago and decisions of the district court have been appealed multiple times.  The settlement agreement with its exhibits, including Exhibit 3 (the proposed notice to class members), can be reviewed here.

It is the author’s opinion that the proposed settlement is likely to be approved by the court.



Courts Continue to Permit Expert Testimony on a Variety of ERISA Issues

By Joseph A. Garofolo

In Abbott, et al. v. Lockheed Martin Corporation, et al.—the 401(k) plan excessive fee lawsuit in which a provisional settlement was recently reached—expert testimony was almost certain to play a critical role had the case proceeded to trial.  Just before the provisional settlement was reported, as a potential prelude to the clash between experts if the case had continued, the United States District Court for the Southern District of Illinois ruled that it would permit a supplemental expert report of one of the plaintiffs’ experts.  In his supplemental report, the plaintiffs’ expert opined that plan “fiduciaries’ attempts (or lack thereof) to explore alternative recordkeeping and administrative processes contributed to the excessive amount of fees assessed against Plan participants over the years.”  (Order dated December 14, 2014 at 1).

As evidenced by the Abbott litigation, expert testimony can take center stage in ERISA cases all the way up to trial.  But what is the basis for allowing such testimony and what issues have experts been permitted to opine upon in ERISA cases?

To begin with, Rule 702 of the Federal Rules of Evidence focuses on the expert’s qualifications, the reliability of the proffered testimony, and whether the testimony is helpful to the trier of fact.  And Rule 704 declares that “[a]n opinion is not objectionable just because it embraces an ultimate issue.”

In light of the guidance provided by Rules 702 and 704 of the Federal Rules of Evidence, it is not surprising that federal courts across the circuits have permitted expert testimony regarding a variety of ERISA issues.  See, e.g., Hans v. Tharaldson, 2011 U.S. Dist. LEXIS 151083, at *17 (D.N.D. Dec. 23, 2011) (expert “may testify about the duty to act prudently, the standard of care applicable to a fiduciary in this situation, how [defendant’s] actions deviated from the applicable standard of care, and/or why he believes [the] . . . analysis [of the other side’s expert] is flawed”); In re Iron Workers Local 25 Pension Fund, 2011 U.S. Dist. LEXIS 34505, *15-*16 (E.D. Mich. Mar. 31, 2011); Stinker Stores, Inc. v. Nationwide Agribusiness Ins. & Order Co., 2010 U.S. Dist. LEXIS 31643, at *11-*12 (D. Idaho Mar. 31, 2010) (expert opinions would be “helpful to the jury in understanding relevant issues of employee benefit administration and ERISA, and the application of relevant . . . policy language to the day-to-day practice of employee benefits administration”); In re Reliant Energy ERISA Litig., 2005 U.S. Dist. LEXIS 48034, at *8 (S.D. Tex. Aug. 18, 2005) (expert “opinions on specific issues, such as whether Defendants were ERISA fiduciaries for certain relevant purposes” could be helpful to the court); Engers v. AT&T (In re Engers), 2005 U.S. Dist. LEXIS 41693, at *3, *10 (D.N.J. Aug. 10, 2005); Stuart Park Assocs. Ltd. Partnership v. Ameritech Pension Trust, 51 F.3d 1319, 1327 (7th Cir. 1995).

In what might actually be an understatement, one court explained that the “interactions of ERISA, the [Internal Revenue Code], and their accompanying regulations were ‘sufficiently esoteric’ to the uninitiated factfinder to justify expert witness opinion testimony under Rule 702.”  Proujansky v. Blau, 2000 U.S. Dist. LEXIS 786, at *23 (S.D.N.Y. Jan. 27, 2000).

Moreover, since most ERISA cases are bench trials, in the author’s experience, the admissibility of expert testimony may remain unresolved at trial because a judge may be inclined to delay a ruling on challenged expert testimony until after trial.

Thus, it is likely that experts will continue to assume an important role in ERISA litigation, especially in cases involving complex issues or alleged breaches of fiduciary duty.