BENEFITS DIGEST

The court dismissed the second amended complaint against EssilorLuxottica with prejudice on October 23, ending the 401(k) suit over the plan’s stable value fund. The participants’ comparator funds were inadequately explained and didn’t match the challenged investment, the court found, and the challenged fund’s time in the plan only briefly overlapped the class period. A recordkeeping-fee count went beyond the limited permission to amend the court had granted, a procedural ruling rather than a finding that the fees were reasonable, and the monitoring claim fell with the rest. Nothing in the order decides whether the plan’s investment process was actually prudent. The plaintiffs never pleaded enough to put that question to a trial, and for sponsors the ruling adds to the line of cases requiring apt comparator funds before an investment suit proceeds.

Ramboll’s U.S. units and their plan committees have agreed to pay $750,000 to settle a class action over the stable-value option in the Ramboll US Retirement & Savings Plan, a plan with more than 3,000 participants. The February complaint alleged the fiduciaries kept the Prudential Guaranteed Income Fund while comparable guaranteed investment contracts credited more interest, and the parties settled in July with a dismissal motion pending and before any ruling on the merits. Plaintiffs’ October 16 [preliminary-approval papers](https://digest.theinnerfirm.com/docs/jones-v-ramboll-prelim-approval-memo-2026-10-16.pdf) put potential class damages at $3 million to $4 million against conservative comparators, making the deal 19% to 25% of their own best case before fees and expenses. Requested fees run up to a third of the fund, and the [settlement](https://digest.theinnerfirm.com/docs/jones-v-ramboll-settlement-agreement-2026-10-16.pdf) allocates the net amount according to participants’ holdings in the disputed investment, with deposits to active accounts and checks to former participants. Ramboll denies wrongdoing, and the proposal is before Judge Brenda Sannes.

Alight’s 401(k) index recorded just four above-normal trading days in the entire third quarter, against ten in the second, with 0.18 percent of assets changing funds. Even the Federal Reserve’s September 16 rate increase didn’t produce an above-normal trading day. The only busy day of the month came the day before the announcement, and the ten days after it never reached above-normal volume. What trading occurred leaned steadily toward safety. Fixed-income funds drew net inflows on 81 percent of September’s trading days, up from 50 percent in July, with money going to stable value, money market and bond funds while large-cap equity and target-date funds had net outflows. Alight’s read is that automatic enrollment and target-date defaults have simply removed most participants from day-to-day investing, and that the drift toward fixed income looks like modest rebalancing rather than flight from stocks.

Yohanna Wallace has filed her opposition to Pilgrim’s Pride’s motion to dismiss her suit over the 401(k) plan’s only stable value option, a Great-West general account contract. The plaintiff argues the contract exposed participants to more risk while paying less than five safer alternatives, every year from 2013 through 2024, and that the plan’s fiduciaries never used their bargaining power to demand better rates or a better product. The brief leans on decisions issued in summer 2026 sustaining nearly identical claims, including one involving the same Great-West contract, and it cites the Supreme Court’s pending Anderson v. Intel case, set for argument October 6, on what a participant must plead. The motion is now with Judge Sweeney in Colorado federal court.

A federal judge dismissed the amended retirement-plan complaint against Legacy Health, its board, and its retirement committee. The plaintiffs have 30 days to try again. Judge Adrienne Nelson found the stable-value claims failed for want of a meaningful benchmark: none of the 13 comparator funds was alleged to be the same kind of guaranteed investment contract, and the court held the Ninth Circuit's approach to comparing investment funds, now under Supreme Court review in Anderson and set for argument October 6, applies to stable-value challenges too. A T. Rowe Price growth fund claim failed because underperformance against one benchmark, standing alone, doesn't plead imprudence. On forfeitures, the court joined the majority view that applying forfeitures to employer contributions, as the plan expressly permitted, is neither disloyal nor imprudent without more, found the anti-inurement claim failed because the money never left the plan, and noted the Ninth Circuit's pending Hutchins appeal on the same question.

A class action against Philips North America over its $5.7 billion 401(k) plan survived dismissal in full last Thursday, in a ruling that touches both of the season's litigation waves at once. The prudence claim alleges the plan held onto a Prudential stable value fund while comparable guaranteed investment contracts outperformed it by an average of more than 40%, and the court held that First Circuit precedent protecting conservative investments did not control because the complaint identified specific steps the committee never took, requesting proposals from providers and negotiating the crediting rate. Whether the comparators are meaningful is a question of fact for discovery. The forfeiture claim survived on the loyalty theory. The court acknowledged the majority rule that steering forfeitures to reduce company contributions does not breach the duty of loyalty, then reasoned that a fiduciary who always exercises that discretion for the employer and never for participants, without ever investigating the alternative, may plausibly have acted out of self interest. The same theory survived in the Penn State Health case covered yesterday and failed for good in Lithia Motors.

Trucker Huss surveys the wave. More than two dozen class actions since the start of 2025 challenge the selection and monitoring of stable value funds, most built on crediting rate comparisons against competitor products and an invitation to infer a flawed process from performance alone. The firm maps the meaningful benchmark pleading standard circuit by circuit, with the Sixth Circuit's Parker-Hannifin decision as the outlier that lets context allegations substitute for comparators, and notes the whole question reaches the Supreme Court in Anderson v. Intel, set for argument October 6. Five practical steps close it out, from understanding who bears credit risk under the wrap contract to documenting the deliberate trade of yield for protection. The Philips ruling above is the wave's newest survivor.

Fidelity's survey of 1,311 plan sponsors finds 41% now want their adviser to hold full discretion over the investment menu, up from 36% last year, and 89% plan to add investment options within a year. Half are weighing a replacement of their target date funds, with versions carrying embedded annuities or stable value drawing the most interest, and the help sponsors most want from advisers is on legislative and fiduciary issues.

The stable value litigation wave picked up another survivor last Wednesday, in a ruling that teaches two lessons at once. A former Penn State Health employee had signed a severance release, and the court enforced it, dismissing his individual and class claims. But a release cannot waive claims brought on a plan's own behalf, so his derivative claims proceed. Those claims allege the fiduciaries kept an underperforming Great-West guaranteed investment contract while paying the same insurer recordkeeping fees 224% higher than average, and let forfeitures offset nearly twelve million dollars of the employer's own contributions without accounting for the conflict of interest. That loyalty theory survived where other forfeiture suits keep failing because it attacks the self-interested exercise of discretion, not the practice itself. The court also rejected an industry amicus attack on the complaint's comparator funds, holding that perfect comparators are not required at the pleading stage.

The ERISA consultants at the Retirement Learning Center address a question about liquidating a stable value investment in a client's 401(k) plan, and the market value adjustment and fiduciary liability issues the move can trigger.

A federal judge has granted a motion to dismiss a stable value suit, because the plaintiffs “have failed to state any of their claims.” And not for the first time, apparently.