In a recent legal document filed in the U.S. District Court for the Southern District of Illinois by defense lawyers Gregory C. Braden and Michael J. Nester, IPC insists that its plan does not charge excessive fees despite the filing of the 2006 suit (See Lawyer: Excessive Fee Suits Not an Organized Anti-Plan Campaign ).
The company faithfully followed the dictates of the Employee Retirement Income Security Act (ERISA), Braden and Nester asserted. Among IPC’s specific defenses were that:
- the fees associated with the plans are not excessive or unreasonable and have been properly disclosed.
- the plans’ service providers received no more than reasonable compensation.
- the company’s conduct has been “both procedurally and substantively prudent.”
- neither plaintiffs or the plans, nor anyone else suffered a loss as a result of the actions or inactions of the defendants.
- plaintiffs’ claims were barred to the extent that plaintiffs exercised independent control over their plan accounts.
- plaintiffs’ claims were barred by ERISA Section 404(c).
- plaintiffs do not seek planwide relief.
- not all of the named defendants are plan fiduciaries
While insisting that the amount of fees it paid was “at all times reasonable,” IPC admitted that “from time to time (IPC) paid for the following services from assets maintained under the plans: trustee, recordkeeping, administrative, investment advisory, investment management, brokerage, consulting, accounting, legal, printing, mailing and other services.”
Wrote Braden and Nester: “Defendants further (contend) that all such services were necessary to the operation and administration of the plans and that the amounts paid for such services were at all times reasonable.”
The IPC lawyers also denied any fee-related impropriety in its Company Stock fund. Any fees related to that fund, the lawyers asserted, “are reasonable, incurred for the sole benefit of participants and beneficiaries, and fully disclosed to participants and beneficiaries.”
The case is Beesley et. al. versus International Paper Company, 3:06-cv-00703-DRH-CJP.
Earlier this month, CIGNA Corporation lawyers took a similar approach defending an excessive fee suit. Their defense came down to this: We did what we were legally required to do (See CIGNA’s 401(k) Fee Suit Defense: We Obey All Current Laws ).