Arguments over Cornell University’s retirement plan on Wednesday prompted the US Supreme Court to examine the guardrails that would allow courts to weed out bare-bones lawsuits challenging innocent conduct.
The court’s decision could dictate how easy—or difficult—it is for workers to successfully argue that retirement plan service provider arrangements violate ERISA’s prohibited transaction rules. These rules, which erect barriers between plans and interested parties, have driven a circuit split.
The case asks the justices to decide whether the statutory exemptions from that rule must be addressed in a plaintiff’s complaint, or whether they’re defenses to be demonstrated by the plan ...