In the suit dated Monday and filed in the US District Court for the Southern District of Illinois, attorney Jerome Schlichter of the firm Schlichter, Board & Denton alleges that Kraft and various committee representatives caused the plan to pay fees that were too high through a master trust. Kraft has more than $5 billion in its 401(k) program.
In an online bulletin, attorney Michael Hoes of the Kansas City, Missouri firm of Spencer Fane Britt & Browne, pointed out that the Kraft suit differs from the nine others filed earlier this year (See Law Firm Launches Lawsuits Over 401(k) Fees ) in that Kraft is not charged with allowing investment vehicles to charge excessive, undisclosed fees that were then shared with plan service providers.
Hoes said that plaintiffs claimed that this revenue
sharing created the illusion that the plan expenses were
minimal, when, in fact, participants were being charged
for these expenses indirectly through higher management
Hoes said it was not yet clear why the Kraft litigation does not contain allegations of improper revenue sharing, but that the Schlichter lawyers could be hoping to add it later as more evidence becomes available through the normal discovery process.
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