The Labor Department’s fiduciary rule may give IRA investors access to jury trials in class action lawsuits, a right that has been denied to the vast majority of plaintiffs in class actions brought under the Employee Retirement Income Security Act.
Under the rule’s private right of action provision, IRA investors can bring class action claims if the Best Interest Contract Exemption—which includes a warranty guarantying a fiduciary standard of care for advice on IRA investments--is breached.
As a general matter, those claims will be brought under contract law in state courts, and not under ERISA, a federal statute that in most cases is deliberated in federal courts.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
