Monday, October 27, 2008
LaRue and the Coming Avalanche of ERISA Fiduciary Litigation
Update: Rob Hoskins is right in the comments below. LaRue did not continue his case because "After beginning discovery, Plaintiff has decided that it is not financially feasible to continue to pursue his claim." But my point is the same: LaRue, because of the difficulties associated with these claims, will not lead to an avalanche of litigation.
Not so much.
You may recall that after the Supreme Court in LaRue v. DeWolff, Boberg, and Associates found that individuals could bring breach of fiduciary claims against their plans for mismanagement of their 401(k) accounts, there were many who predicted that such 401(k) suits would overwhelm the courts and generally spell disaster for the judiciary of this country (I didn't predict that, but I thought the principle of the holding was an important one).
Now, that coming avalanche of litigation might still happen in some world where the sky is green, but interestingly I just received word from DeWolff, Boberg's Supreme Court advocate, Tom Gies of Crowell and Moring, that Mr. LaRue has voluntary dismissed his claim in the action recognizing that
he could not meet the applicable statute of limitations that it was too expensive to proceed Yup, that's right. These claims are now so easy that Mr. LaRue decided he couldn't proceed .
In short, these types of claims are still extremely difficult for plaintiffs to prevail upon
- for one reason, because of the statute of limitation issue that bit Mr. LaRue in th behind - and all the doomsday prognostications to the contrary seem just a tad off.
Mr. Larue did not have a statute of limitations problem. The case was voluntarily dismissed solely because the amount of already incurred and future anticipated costs simply made it financially imprudent to proceed. The statute of limitations reference in the consent order is simply an acknowledgement that he will not LATER refile the suit. The original lawsuit was easily filed within the S.O.L. and you should edit your post accordingly. I can assure you that no S.O.L. problem "bit Mr. Larue in the behind".
Posted by: Rob Hoskins | Oct 27, 2008 6:55:08 PM