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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.

However, the court granted FCA’s request to take judicial notice of external documents, including annual Form 5500 reports and fund prospectuses referenced by employees in their filing.

What’s at Stake

The case underscores the growing scrutiny on how corporate giants manage retirement benefits, with workers challenging whether their nest eggs are being properly safeguarded. FCA, a subsidiary of Stellantis NV, oversees iconic brands like Jeep, Dodge, Ram, Chrysler, and Alfa Romeo—but it now faces questions not about engines and performance, but about fiduciary prudence and financial stewardship.

Counsel and Representation

The proposed class is represented by Oliver Bell Group, Miller Shah LLP, and Don Bivens PLLC. FCA is defended by attorneys from Littler Mendelson PC.

Neither side responded immediately to requests for comment. For employees, though, the ruling marks a green light to push forward in their pursuit of accountability over how retirement savings are managed.