Fiat Chrysler’s attempt to slam the brakes on a retirement plan lawsuit has failed, as a Michigan federal judge ruled Tuesday that employees had made a strong enough case to proceed with claims of mismanagement tied to the automaker’s 401(k) plans.
Allegations of Mismanaged Funds
The suit, filed in November 2024, targets two defined-contribution retirement plans offered to FCA workers: the UAW Savings Plan, created under a union agreement, and a 401(k) plan for salaried employees. Workers allege the company kept funneling retirement savings into underperforming custom target-date funds and a large-cap equity fund, despite evidence of stronger alternatives.
U.S. District Judge Robert J. White agreed the complaint paints a picture of potential fiduciary breaches under the Employee Retirement Income Security Act (ERISA). “The repeated inability to meet FCA’s benchmarks and the presence of better options establish an inference of flaws in the fiduciary process,” White wrote.
Broader Claims Survive
In addition to keeping alive the fiduciary breach allegations, Judge White refused to dismiss claims that FCA failed to monitor its plan managers and knowingly breached trust obligations—both derivative but still viable under ERISA.
