Goldman Sachs defeats employee class action over retirement plan
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By Jonathan Stempel
NEW YORK (Reuters) -Goldman Sachs Group Inc gained the dismissal of a proposed class motion by tens of hundreds of staff over its alleged imprudent use of high-cost, underperforming in-house mutual funds as funding choices of their retirement plan.
U.S. District Decide Edgardo Ramos in Manhattan discovered no proof that Goldman’s 401(ok) retirement committee’s determination to make use of 5 funds managed by Goldman Sachs Asset Administration created a battle of curiosity as a result of the affiliate acquired administration charges.
He additionally discovered no obligation for Goldman to have extra rapidly eliminated poorly performing funds from the plan, which had about three dozen funding choices, and referred to as it speculative to counsel the committee would have “acted in another way” if it had extra formal standards to evaluate fund efficiency.
“The mere risk that committee members could have been influenced by a need to learn Goldman Sachs is just not sufficient to point out a breach of the obligation of loyalty,” Ramos wrote in a 34-page determination made public late Thursday.
Attorneys for the workers didn’t instantly reply on Friday to requests for remark. Goldman didn’t instantly reply to comparable requests.
The lawsuit coated an estimated 29,000 to 35,000 Goldman staff who invested as a lot as $7.5 billion of their 401(ok)s between Oct. 25, 2013 and June 6, 2017, when the final of the 5 challenged funds was faraway from the plan.
It was one in all a collection of lawsuits difficult corporations’ administration of outlined contribution plans beneath the federal Worker Retirement Earnings Safety Act, or ERISA.
The case is Falberg v Goldman Sachs Group Inc, U.S. District Court docket, Southern District of New York, No. 19-09910.
(Reporting by Jonathan Stempel in New YorkEditing by Chris Reese)