The Supreme Court has granted certiorari in Tibble v. Edison Int’l, [SCOTUS No. 13-550] to consider the statute of limitations under the Employee Retirement Income Security Act (ERISA). ERISA allows plan participants six years to challenge the prudence of decisions made by plan fiduciaries.
In Tibble, participants in a multi-billion dollar 401(k) plan offered and administered by the defendants alleged that the defendants breached their duty of prudence by offering retail-class mutual funds as plan investments, rather than lower-fee institutional-class funds. The district court determined that plaintiffs’ claim was barred by ERISA’s six-year statute of limitations because the decisions to add the retail-class funds were made more than six years before the suit was filed, and the Ninth Circuit affirmed. The plaintiffs petitioned for review in the Supreme Court.
In support of plaintiffs’ petition, the Solicitor General filed an amicus brief, arguing that there was a continuing violation of ERISA – that is, that the defendants owed a continuing duty of prudence, which they breached by failing to research fund options and offer available lower-cost institutional-class investments during the six-year period prior to the filing of the complaint. In determining the statute of limitations issue, the Court will necessarily consider the “continuing violation” theory which could potentially negate the effect of the statute of limitations.
Prepared by Deborah Alley Smith