Additionally, the ex-workers accused Nvidia of sticking with higher-fee investments when more affordable options were available. They argued that the company could have chosen lower-cost share classes of mutual funds, which would have been more in line with ERISA’s fiduciary duty of prudence.
Nvidia Deal In 401(k) Mismanagement Suit : Case History and Legal Proceedings
U.S. District Judge Lucy H. Koh initially dismissed the lawsuit in September 2021, but allowed the former employees to amend their complaint. Nvidia argued that the claims still lacked sufficient detail to show the company had breached its fiduciary duties under ERISA.
In September 2023, Judge Tigar ruled in favor of allowing the case to proceed, saying the workers had provided sufficient evidence regarding key issues, including how Nvidia’s recordkeeping fees compared to similar plans. The judge acknowledged Nvidia’s concerns about whether a $35 recordkeeping fee was appropriate but noted that resolving that issue wasn’t necessary at that stage.
