On April 6, 2016, the U.S. Department of Labor ("DOL") issued its final rule expanding the definition of the "investment advice fiduciary" under the Employee Retirement Income Security Act of 1974 ("ERISA") and modifying the exemptions for investment activities. The new rule will be phased in starting in April 2017, and it is anticipated to draw battles over its expansion of the circumstances under which providing investment advice could give rise to a fiduciary duty. Specifically, by expanding the definition of a fiduciary, the rule casts a wide net in assigning fiduciary ...
The United States Supreme Court clarified the duty of prudence that employee stock ownership plan fiduciaries owe to plan participants in its June 25, 2014 decision Fifth Third Bancorp v. Dudenhoeffer 134 S.Ct. 2459 (U.S. 2014). The "presumption of prudence" no longer exists and employee stock ownership plan fiduciaries are subject to the same standard of prudence and liability as any ERISA fiduciary, aside from the duty to diversify. The United States Supreme Court addressed the "presumption of prudence" for employee stock ownership plan ("ESOP") fiduciaries. ESOPs are a type of ...