A North Carolina federal judge denied Labcorp’s motion for an early win Friday in a class of employee 401(k) participants’ suit alleging their retirement savings were mismanaged, citing the parties’ factual disputes over whether recordkeeping fees and investment offerings violated federal benefits law.
Judge Rules Disputes Must Be Resolved in Court
U.S. District Judge Loretta C. Biggs entered a memorandum opinion and order denying a motion for summary judgment from Laboratory Corporation of America Holdings in the Employee Retirement Income Security Act class action from Labcorp worker Damian McDonald.
McDonald first sued in 2022, alleging Labcorp breached ERISA’s fiduciary duty of prudence by retaining high-fee investment offerings in its 401(k) plan and by allowing its plan recordkeeper, Fidelity Workplace Services LLC, to charge excessive fees.
Judge Biggs said in her order Friday that the court found that genuine issues of material fact remained regarding whether Labcorp breached its ERISA fiduciary duty of prudence by allowing Fidelity’s recordkeeping fees. The parties’ experts also disputed whether higher-cost share classes of mutual funds offered to retirees were imprudent in violation of ERISA, Judge Biggs said.
