Exela Enterprises Must Face Suit Over $157 Million 401(k) Plan

Exela Enterprise Solutions Inc. defeated portions of a lawsuit challenging its 401(k) plan management, but it must face claims targeting the plan’s administrative fees and share classes, according to a Monday ruling by the District of Connecticut.

Exela—which merged with Novitex Holdings Inc. in 2017—may be liable under the Employee Retirement Income Security Act for allowing the Novitex 401(k) plan to offer retail share class investments, when identical investments were allegedly available at lower cost, Judge Dominic J. Squatrito ruled. Squatrito also declined to dismiss claims that the plan paid excessive administrative fees to Transamerica for record keeping services.

But ...