Benefits & Executive Compensation News

Eighth Circuit OKs Fidelity’s Float Practice,
Affirms $13.4 Million Judgment Against ABB

March 20, 2014, 4:00 AM

A district court properly hit ABB Inc. with a $13.4 million judgment for its payment of excessive record-keeping fees to Fidelity Management Trust Co. in connection with its 401(k) plan, a three-judge panel of the U.S. Court of Appeals for the Eighth Circuit ruled March 19 (Tussey v. ABB, Inc., 8th Cir., 12-2056, 3/19/14).

However, the panel vacated the district court’s $21.8 million judgment against ABB on class-action claims by plan participants challenging the plan’s investment options and the “mapping” of plan assets from Vanguard to Fidelity.

The panel was divided on the issue of float income,...

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