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401(k) suit against Nationwide puts micro plans in crosshairs

Here's a new wrinkle in the prospect of small employer liability under ERISA.

By Nick Thornton | Updated on June 30, 2017
Critics of the trial bar have suggested for years that the rash of lawsuits against sponsors of mega 401(k) plans, which began in earnest about a decade ago, would ultimately encourage claims targeting sponsors of small plans.

A new lawsuit filed in a Ohio federal court alleges Nationwide Life Insurance Co. has been systemically overcharging sponsors on its small plan record-keeping platform.

The claim is brought on behalf of a paralegal employed at Andrus Wagstaff PC, a Denver-based personal injury law firm that sponsors a 401(k) plan with $1.1 million in assets and 27 participants, and represents a potential new evolution in litigation against defined contribution plans.

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Nick Thornton

Nick Thornton

Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.

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