George v. Kraft Foods Global, Inc.

Dist. Ct. erred in granting defendants-plan administrators’ motion for summary judgment in ERISA action alleging that defendants allowed instant 401(K) plan to incur excessive expenses in rems of investment drag and transactional drag that caused plaintiffs’ investments in two company stock funds to underperform by $83.7 million over seven year period. Record did not support Dist. Ct.’s finding that defendants made reasoned decisions regarding plaintiffs’ proposal to reduce investment and transactional drag. Dist. Ct. also erred in granting defendants’ motion for summary decision on plaintiffs’ claim that defendants awarded plan’s record-keeper extension on contract without seeking bids for said services from other potential record-keepers where Dist. Ct. improperly discounted opinion of plaintiffs’ expert, who stated that competitive bidding would have saved each plan participant $16 per year had competitive bidding been done. (Partial dissent filed.)