Citigroup, Cisco, Others Sued Over 401(k) Plans’ BlackRock Funds

A suite of target date funds from BlackRock Inc. is driving the latest wave of 401(k) litigation, with employees of Citigroup Inc., Cisco Systems Inc., Stanley Black & Decker Inc., and Wintrust Financial Corp. filing lawsuits challenging the suite’s performance.

The proposed class actions, filed July 29 in federal courts in California, Connecticut, and Illinois, take aim at the BlackRock LifePath Index Funds, which are offered as the default investment option in each of the defendant employers’ retirement plans. These funds were poor performers and “vastly inferior” to similar options offered by competitors, the lawsuits allege.

Citigroup, ...