IMHO: The "Burden" of Proof

The case, of course, was one of the earliest in the litany of those cases to be filed in 2006, and the only one (thus far) to reach the appellate level (see " 7th Circuit Panel Limits Ruling's 404(c) Effects ") .  

To date, the courts have, with little exception, dispensed with these cases harshly.   Not that they aren't entitled to do so, of course, and not that this particular generation of filings isn't deserving of such treatment, IMHO.   From the beginning, the plans targeted seemed better-designed to fill the pockets of plaintiffs' counsel, if for no other reason than large employers frequently figure that it's cheaper to settle than to fight (see " IMHO: Fighting Words ").   That said, the courts—including the 7 ^th Circuit—seem to have a more "generous" view of what it takes to earn the protections of ERISA 404(c ) than most ERISA lawyers I know.

I was no less confused by the 7 ^th Circuit's response to the request for a rehearing.   Basically, the court said that there had been no judicial call for such reconsideration, and that, in fact, the judges who made the original determination had voted to deny the petition for reconsideration.   However, the judges apparently felt the need to respond directly to some of the charges made in the amicus curiae briefs filed in support of the motion—and, perhaps more significantly, it took pains to point out that its ruling in the case, and on the facts presented, shouldn't be applied too broadly.   And that, of course, seems to have been a source of solace and comfort to the folks who have brought us these revenue-sharing lawsuits, who have reason to feel "down" (based on the limited adjudications to date), but are apparently not "out."

Now, I didn't mind that the courts have held there is no fiduciary duty to disclose fees to participants (there isn't), nor the determination that plan sponsors need not scour the marketplace to find the cheapest investment choices (cheapest might not even be "reasonable").   But, having spent some reasonable part of my adult life trying to understand and help others understand the scope, implications of, and limitations to ERISA 404(c), I've generally been puzzled at how liberally the courts have been willing to apply its protections, certainly in contrast to the position espoused by the Department of Labor (which, I should add, has been remarkably consistent in its voice on the subject).