Judge Says 401(k) Litigants Should Prepare For Trial

Save a last-minute settlement to prevent a trial in the 2020 excessive fees lawsuit Tania Nunez et al. v. B. Braun Medical Inc., trial dates will be set this week, according to a federal judge’s order.

U.S. District Judge Edward G. Smith, presiding in U.S. District Court for the Eastern District of Pennsylvania, on April 21 denied a motion for summary judgment and scheduled a conference call for April 26, according to the filing dismissing the defendants’ motion.

“The Committee has moved for summary judgment on the plaintiffs’ sole remaining claim, arguing that the factual record does not support the existence of a breach of duty of prudence,” Smith wrote. “Nevertheless, because there are genuine issues of material facts regarding the reasonableness of both the Committee’s process and actions as the plaintiffs’ fiduciary, the court denies the motion for summary judgment.”  

Smith also instructed the parties to prepare for a telephone conference and directed the clerk of court to terminate as defendants all the named and unnamed parties to the lawsuit other than the Retirement Committee of B. Braun Medical Inc., which is now the sole defendant, according to the order.

Despite allegations by the plaintiffs, the retirement plan is well-managed, Jennifer Prioleau, chief legal officer and chief compliance officer at B. Braun Medical Inc., said in a statement by email.

“We are mindful of the Court’s ruling on B. Braun’s motion for summary judgment, and we intend to continue to vigorously defend against the allegations of the Complaint,” she said. “We believe that the B. Braun 401(k) Plan is and has been well managed, and that it provides a valuable benefit to our employees.”

Smith had previously denied dismissal of the claims for breach of duty of prudence under the Employee Retirement Income Security Act and granted dismissal for the claims of breach of duty of loyalty, according to court documents. 

“Because of that order, the plaintiffs’ sole remaining cause of action is against the Committee for breach of its fiduciary duty of prudence,” wrote Smith in the order to dismiss the motion for summary judgement.  

The lawsuit was initially brought in 2020 by former participants of the B. Braun Medical Inc. Savings Plan. The complaint alleged plan fiduciaries failed in their duties to ensure investment fees were reasonable and not excessive.

B. Braun Medical Inc. USA is based in Bethlehem, Pennsylvania. The B. Braun Medical Inc. Savings Plan held as of December 31, 2021, according to court documents. The 2018 Form 5500 filed with the Department of Labor listed 6,332 plan participants with account balances as of the end of the plan year and more than $571 million in assets under administration for the year, according to the original complaint.

The plaintiffs are represented by attorneys with law firm Capozzi Adler PC, based in Harrisburg, Pennsylvania, and the defendants by attorneys from the Groom Law Group, headquartered in Washington, D.C.