On April 17, 2025, the U.S. Supreme Court reached a unanimous ruling in the significant case of Cunningham v. Cornell University, resolving a long-debated legal issue. The central question was: Who is responsible for the burden of proof at the outset of an ERISA lawsuit involving "prohibited transactions" or "excessive fees"? The Court's decision has clarified that the burden lies with the defendant.
The Sixth Circuit upheld the dismissal of a class action lawsuit against DENSO International America, Inc. regarding alleged excessive fees under ERISA. The plaintiffs, consisting of current and former employees, claimed that DENSO breached its fiduciary duties by failing to adequately monitor the Plan's recordkeeping fees, asserting that these fees were excessive compared to the quality of services provided. However, the court found that the complaint lacked sufficient factual detail to demonstrate that lower-cost, comparable recordkeeping services were available. Consequently, the court affirmed DENSO's motion to dismiss the case, reaffirming the standards for establishing claims of excessive fees under ERISA.
Businesses sponsoring retirement plans, such as 401ks, must be vigilant against cybercrime, as they face legal obligations to protect against incidents and minimize damages from breaches. While fiduciary risks exist, including personal liability for losses, these can be mitigated. Experts at Savant Wealth emphasize that 401k plans are attractive targets for cybercriminals and advise sponsors to follow the guidance provided by the Department of Labor to enhance security measures.
According to The Cerulli Report -- U.S. Retirement End-Investor 2025, most active 401k participants are planning for retirement without an advisor, presenting an opportunity for recordkeepers to provide guidance, especially to unadvised participants. The report indicates that 63% of these participants, many from the mass-affluent demographic, lack financial advisors but express interest in hiring one in the future. Additionally, 52% of mass-affluent participants rely on their retirement savings account providers as their main source of retirement planning advice.
The 25th Edition of the 401k Averages Book reveals a continued decline in investment and recordkeeping fees in the 401k industry, contributing to lower total plan costs for employers and participants. Average investment-related fees fell by 0.02% to 0.12% across all plan sizes, while some scenarios saw recordkeeping fees decrease by up to 0.03%.
The DOL has rescinded previous guidance from the Biden administration that discouraged cryptocurrency investments in 401k plans. With the issuance of Compliance Assistance Release No. 2025-01 on May 28, 2025, the DOL adopts a more neutral stance on including cryptocurrencies as investment options. The 2025 Release clarifies that the "extreme care" standard mentioned in the earlier guidance is not part of ERISA and suggests that it imposes a higher standard of care on fiduciaries than what is generally required under ERISA.
Fisher Investments has elevated its fiduciary status by launching an educational website, Fiduciary.com, after purchasing the domain in 2024. The firm, based in Plano, Texas, manages $298.7 billion in assets and aims to provide valuable information. However, some leaders in the fiduciary movement criticize the move, suggesting it represents a monetization of the fiduciary standard that distinguishes independent registered investment advisers from brokers.
Retirement plan sponsors and advisers face the crucial decision of selecting an appropriate qualified default investment alternative for participants. Authorized by the Pension Protection Act of 2006, QDIAs offer fiduciaries a safe harbor for defaulting participants into approved investments. Target-date funds are the predominant choice, with 94% of plans currently using them as the default option, according to a 2024 report from the Plan Sponsor Council of America. However, industry experts question the effectiveness of the one-size-fits-all model of TDFs and suggest considering alternatives like managed accounts. Despite these discussions, any potential transition to different QDIAs appears to be in very early stages.
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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.
