Participants in a 401(k) plan operated by Old Dominion Freight Line Inc. sued the company, alleging violations of ERISA. This plan offered a high investment compared to cheaper, identical options available on the market.
“By forcing plan participants to pay more for the same investment, defendants failed their statutory ERISA obligations to prudently bear the costs of the plan,” U.S. District Court in Greensboro, North Carolina. The lawsuit, filed on Nov. 18, said:
“Defendants chose a more expensive class of stock than an identical less expensive class of stock of the same investment,” said the Davis v. Old Dominion Freight Line complaint.
Plaintiffs are seeking class action status. “Defendants should have been aware of the existence and availability of lower-priced share classes,” the lawsuit said. “Nevertheless, defendant selected and retained the more expensive stock class in the plan’s menu of investment options.”
Company representatives did not respond to requests for comment.
According to the lawsuit, as of December 31, 2021, the former Dominion 401(k) retirement plan in Thomasville, North Carolina had $2 billion in assets and 24,033 participants.