Franklin Templeton In-House 401(k) Fund Challenge Moves Forward

Three participants in Franklin Templeton’s 401(k) plan advanced their lawsuit claiming the plan was filled with in-house funds that performed poorly while charging high fees.

The proposed class action accuses the company—formally known as Franklin Resources Inc.—of filling its employees’ retirement plan with proprietary funds that underperformed their benchmarks, had poor ratings, and were unpopular with other investors while paying high fees to the company and its subsidiaries. These allegations are sufficient to suggest that Franklin breached its fiduciary duties under the Employee Retirement Income Security Act, Judge Vince Chhabria said April 17 for the US District Court for the ...