A new lawsuit has been filed against RTX Corp., previously known as Raytheon Technologies Corp., concerning its 401k plan. The plaintiffs, Melissa Jacob and Thomas Miller, along with other participants and beneficiaries, allege violations of ERISA. They accuse the defendants of not adhering to plan documents, breaching fiduciary duties of loyalty and prudence, utilizing plan assets for the employers' benefit, mismanaging plan assets for personal interests, and facilitating prohibited transactions. The case is identified as Jacob v. RTX Corp. in the Eastern District of Virginia.
On July 14, 2025, a Legal Update was released that reviewed recent developments in ongoing ERISA forfeiture lawsuits, highlighting new motion to dismiss rulings and an increasing number of pending appeals. This new update notes that, despite a focus on recent legal changes, there has been a surge in new forfeiture lawsuits, with at least seven additional cases filed, bringing the total to nearly 70. An updated list of 22 motion to dismiss rulings is provided and discussed in detail.
A Morningstar report by Jeffrey Ptak examines the performance of mutual funds in the private market and its implications for 401k investors. The report highlights a significant decline in alternative mutual funds since 2015, with only 341 remaining out of 1,345, resulting in a 75% mortality rate over the past decade. While alternative asset managers are promoting private market investments for retirement plans, Ptak cautions about the potential drawbacks of offering these funds to 401k investors and provides recommendations for retirement plan advisors.
Standing issues frequently arise in class actions against fiduciaries of retirement benefit plans, specifically regarding the type of harm a plaintiff must demonstrate to bring a suit. Key questions include whether the harm must be personal, if it needs to be uniform among class members, and the level of proof required. A recent decision from the Second Circuit addressed these concerns, involving plaintiffs Gail Collins, Dean DeVito, Michael Lamoureux, and Scott Lobdell, participants in The Northeast Grocery, Inc. 401k Savings Plan. They filed a seven-count complaint alleging that the fiduciaries of the plan breached various ERISA duties in its management.
Plan sponsors must provide essential communications and disclosures to plan participants to ensure transparency and protect their interests. Watkins Ross has compiled a list of key required notices and disclosures for defined contribution plans, along with distribution deadlines to support plan sponsors in their responsibilities.
Employers have traditionally used non-vested employer contributions, or forfeited assets, to offset future contributions to their 401k plans. However, this practice has come under scrutiny, as some plaintiffs argue that it violates ERISA by suggesting those assets should instead offset plan participant expenses. While district courts have generally upheld the practice of using forfeited assets to reduce future employer contributions, the issue is currently being appealed for the first time before the Ninth Circuit.
As interest in digital assets and cryptocurrencies grows among individual investors, retirement plan sponsors are exploring the potential inclusion of crypto in 401k investment options. The DOL has recently released guidance regarding cryptocurrency investments in retirement plans. Advisors are encouraged to educate plan sponsors on the associated risks and regulatory changes. When clients inquire about crypto investments, advisors should engage them in discussions about the specific risks of cryptocurrencies, considering the investment options and the needs of participants.
President Donald Trump signed an executive order on August 7 that enables U.S. citizens to invest their 401k retirement savings in alternative assets like cryptocurrency, private equity, and real estate. The executive order directs the DOL and other agencies to review and clarify guidelines on these investments within 180 days. It also tasks the DOL with evaluating fiduciary responsibilities related to alternative asset investments in ERISA-governed 401k and other defined-contribution plans, prompting caution from employers regarding the implications of such changes.
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Collected Wisdom™
Our researchers look for what they think are some of the better resources available to assist you in administering your plan or helping your clients. We group these resources in our COLLECTED WISDOM™ topics to make it easy for you to locate the information you need. Each item in a category contains a summary and date of when it was placed in the group.
We also maintain some older material in these collections for perspective and context.
