The Supreme Court recently heard arguments in a case brought by a South Carolina man who alleged his employer, DeWolff, Boberg & Associates Inc., mismanaged his 401(k) plan. According to The Wall Street Journal, the suit says the firm caused the plaintiff’s retirement account to lose $150,000 because requested investment changes were never made.
At issue in the case is whether federal pension law, which allows lawsuits by a group of employees, prohibits a suit over an individual account loss. Legal experts believe the outcome could be an important development in retirement law because of the shift from defined pension plans to 401(k) contribution plans. The case could also affect lawsuits over individual company stock funds, such as those at issue in employee losses from accounting fraud debacles such as Enron Corp.