ERISA lawsuits don’t award emotional distress or punitive damages. Instead, the focus is on restoring financial losses to the retirement plan.

If a plaintiff proves that fiduciaries allowed excessive fees, used underperforming funds, or made self-interested decisions, the court may order the fiduciaries to reimburse the plan. That money goes back into the plan—not directly to the plaintiff—but all participants benefit.

In recent ERISA settlements:
– *Tussey v. ABB* resulted in a $55 million recovery
– *Krueger v. Ameriprise* ended with a $27.5 million settlement
– Dozens of other cases have settled for amounts between $5 million and $40 million

While individual plaintiffs won’t walk away with massive checks, the cumulative impact can be significant—especially in class actions involving large employers. These lawsuits can also force companies to renegotiate vendor contracts and adopt better governance going forward.

The Cunningham ruling makes it easier for plaintiffs to reach discovery, which can lead to more of these outcomes in the future.

What Should Your Company Do Now to Limit Risk?

If you sponsor a retirement plan, Cunningham is your signal to act now. Here’s what you should do:

1. Benchmark Fees: Compare all vendor costs to industry standards. Use third-party evaluators if needed.

2. Document All Decisions: Record why you chose each provider, including meeting notes and scoring criteria.

3. Review Investment Lineups: Offer a diversified set of funds, including low-cost index options.

4. Monitor Vendors Annually: Track service quality, performance, and changes in fees or fund structure.

5. Train Your Fiduciary Committee: Ensure everyone understands their responsibilities under ERISA.

6. Review Contracts for Conflicts: Identify any indirect compensation, proprietary funds, or bundled arrangements.

Litigation risk won’t disappear, but the right practices can drastically reduce exposure—and ensure better outcomes for your plan participants.