UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

WESTERN DIVISION

TRICIA MARVIN, individually, 

and as representative of a Class of 

Participants and Beneficiaries 

of the Mercy Health Corporation 

Employees’ Retirement Plan,

Plaintiff, Case No. 20-cv-50293

v. CLASS ACTION COMPLAINT 

FOR CLAIMS UNDER 

MERCY HEALTH CORPORATION, 29 U.S.C. § 1132(a)(2)

and

THE BOARD OF DIRECTORS OF 

MERCY HEALTH CORPORATION, 

and

JOHN DOES 1-30, 

Defendants

COMPLAINT

COMES NOW Plaintiff, Tricia Marvin, individually and as representative of a Class of 

Participants and Beneficiaries on behalf of the Mercy Health Corporation Employees’

Retirement Plan (the “Plan”),1 by her counsel, WALCHESKE & LUZI, LLC, as and for a claim 

against Defendants, alleges and asserts to the best of her knowledge, information and belief, 

formed after an inquiry reasonable under the circumstances, the following: 

1 From the years 2014 through 2016, the Plan had two predecessor Plans, the Rockford Health System 

Code 403(b) Plan and the Mercy Health System Employees Matched Savings Retirement Plan. On January 1, 2017, 

these two Plans merged to become the current Mercy Health Corporation Employees’ Retirement Plan. The two 

predecessor Plans and the current Plan will be referred to collectively here as either the “Mercy Health Corporation 

Employees’ Retirement Plan” or “the Plan.”

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INTRODUCTION

1. The essential remedial purpose of the Employee Retirement Income Security Act 

(“ERISA”) is “to protect the beneficiaries of private pension plans.” Nachwalter v. Christie, 805 

F.2d 956, 962 (11th Cir. 1986).2

2. The law is settled that ERISA fiduciaries have a duty to evaluate fees and 

expenses when selecting recordkeepers, investments, and service providers, as well as a 

continuing duty to monitor fees and expenses of selected recordkeepers, investments, and service 

providers, and remove imprudent ones. Tibble v. Edison Int’l, 135 S. Ct. 1823, 1828 (2015); 29 

U.S.C. §1104(a)(1)(A) (fiduciary duty includes “defraying reasonable expenses of administering 

the plan”); 29 C.F.R. § 2250.404a-1(b)(i) (ERISA fiduciary must give “appropriate consideration 

to those facts and circumstances” that “are relevant to the particular investment.”) It is for good 

reason that ERISA requires fiduciaries to be cost-conscious: 

Expenses, such as management or administrative fees, can sometimes 

significantly reduce the value of an account in a defined-contribution plan,

Tibble, 135 S. Ct. at 1826, by decreasing its immediate value, and by 

depriving the participant of the prospective value of funds that would have 

continued to grow if not taken out in fees. 

Sweda v. Univ. of Pa., 923 F.3d 320, 328 (3d Cir. 2019).

3. Defendants Mercy Health Corporation (“Mercy Health”), the Board of Directors 

of Mercy Health Corporation (“Board Defendants”), and John Does 1-30 (collectively, 

“Defendants”), are ERISA fiduciaries as they exercise discretionary authority or discretionary 

control over the 403(b) defined contribution pension plan – known as the Mercy Health 

Corporation Employees’ Retirement Plan (“The Plan”) – that it sponsors and provides to its 

employees. 

2 Unless indicated otherwise, cited and quoted cases are omitted. 

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4. Plaintiff alleges that during the putative Class Period (August 6, 2014 through the 

date of judgment), Defendants, as fiduciaries of the Plan, as that term is defined under ERISA, 

29 U.S.C. § 1002(21)(A), breached the duties they owed to the Plan, to Plaintiff, and to the other 

participants of the Plan by, among other things: (1) authorizing the Plan to pay unreasonably 

high fees for recordkeeping and administration (RK&A); (2) failing to objectively, reasonably,

and adequately review the Plan’s investment portfolio with due care to ensure that each 

investment option was prudent, in terms of cost; and (3) unreasonably maintaining investment 

advisors and consultants for the Plan despite the known availability of similar service providers

with lower costs and/or better performance histories. 

5. These unreasonable RK&A fees, investment selections, and service provider 

selections cannot be justified. Defendants’ failure to monitor and improve the recordkeeper, 

investment options, and investment advisors and consultants confirms more than simply sloppy 

business practice. Defendants’ failures breached the fiduciary duties they owed to Plaintiff, Plan 

Participants, and beneficiaries. Prudent fiduciaries of 403(b) plans continuously monitor fees 

against applicable benchmarks and peer groups to identify unreasonable and unjustifiable fees. 

Defendants did not engage in a prudent decision-making process and/or engaged in self-dealing, 

as there is no other explanation for why the Plan paid these unreasonable fees for RK&A, 

investment management, and investment advisory and consultant services.

6. To remedy, Plaintiff brings this action on behalf of the Plan under 29 U.S.C. § 

1132(a)(2) to enforce Defendants’ liability under 29 U.S.C. § 1109(a) to make good to the Plan 

all losses resulting from their breaches of fiduciary duty. Plaintiff also brings party in interest 

prohibited transaction claims based on dealings between the Defendants and the recordkeeper, 

investment manager, investment advisors, and consultants to the Plan. 

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JURISDICTION AND VENUE

7. This Court has subject matter jurisdiction in this ERISA matter under 28 U.S.C. § 

1331 and pursuant to 29 U.S.C. § 1332(e)(1), which provides for federal jurisdiction of actions 

brought under Title I of ERISA, 29 U.S.C. § 1001 et seq.

8. This Court has personal jurisdiction over Defendants because they transact 

business in this District, reside in this District, and have significant contacts with this District, 

and because ERISA provides for nationwide service of process.

9. Venue is appropriate in this District within the meaning of 29 U.S.C. § 1132(e)(2)

because some or all of the violations of ERISA occurred in this District and Defendants reside 

and may be found in this District. Venue is also proper in this District pursuant to 28 U.S.C. § 

1391 because Defendants do business in this District and a substantial part of the events or 

omissions giving rise to the claims asserted herein occurred within the District.

10. In conformity with 29 U.S.C. §1132(h), Plaintiff served the original Complaint by 

certified mail on the Secretary of Labor and the Secretary of the Treasury.

PARTIES

11. Plaintiff, Tricia Marvin, is a resident of the State of Wisconsin and currently

resides in Williams Bay, Wisconsin, and during the Class Period, was a participant in the Plan 

under 29 U.S.C. § 1002(7). 

12. Plaintiff has standing to bring this action on behalf of the Plan because she 

participated in the Plan and was injured by Defendants’ unlawful conduct. 

13. The named Plaintiff and all Participants in the Plan suffered ongoing financial 

harm as a result of Defendant’s continued imprudent and unreasonable investment and fee 

decisions made with regard to the Plan. 

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14. The named Plaintiff and all participants in the Plan did not have knowledge of all 

material facts (including, among other things, the RK&A fees, investment alternatives that are 

comparable to the investments offered within the Plan, comparisons of the costs and investment 

performance of Plan investments versus available alternatives within similarly-sized plans, total 

cost comparisons to similarly-sized plans, information regarding other available share classes,

and information regarding the availability and pricing of other service providers) necessary to

understand that Defendants breached their fiduciary duties and engaged in other unlawful conduct 

in violation of ERISA until shortly before this suit was filed. 

15. The named Plaintiff and all participants in the Plan, having never managed a large 

401(k) plan such as the Plan, lacked actual knowledge of reasonable fee levels and prudent 

alternatives available to such plans.

16. Mercy Health Corporation (“Mercy Health”) is a company with its principal 

headquarters located at 3401 North Perryville Road, Suite 303, Rockford, Illinois 61114. In this 

Complaint, “Mercy Health” refers to the named defendant and all parent, subsidiary, related, 

predecessor, and successor entities to which these allegations pertain. Mercy Health is a regional 

health system with seven hospitals and 85 primary and specialty care locations throughout 50 

northern Illinois and southern Wisconsin communities.

17. Mercy Health is both the Plan sponsor and the Plan Administrator of the Mercy 

Health Corporation Employees Retirement Plan. 

18. As the Plan Administrator, Mercy Health is a fiduciary with day-to-day 

administration and operation of the Plan under 29 U.S.C. § 1002(21)(A). It has authority and 

responsibility for the control, management, and administration of the Plan in accordance with 29 

U.S.C. § 1102(a). Mercy Health has exclusive responsibility and complete discretionary 

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authority to control the operation, management, and administration of the Plan, with all powers 

necessary to properly carry out such responsibilities.

19. Mercy Health acted through its officers, including the Board Defendants, and 

their members, John Does 1-10, to perform Plan-related fiduciary functions in the course and 

scope of their business. For these reasons, Mercy Health is a fiduciary of the Plan, within the 

meaning of 29 U.S.C. § 1002(21)(A).

20. Mercy Health in its Plan Administrator capacity, as well as individuals who 

carried out Plan functions (John Does 11-20), are collectively referred to herein as the “Plan 

Administrator Defendants.”

21. To the extent that there are additional officers and employees of Mercy Health 

who are/were fiduciaries of the Plan during the Class Period, or other individuals who were hired 

as investment managers for the Plan during the Class Period, the identities of whom are currently 

unknown to Plaintiff, Plaintiff reserves the right, once their identities are ascertained, to seek 

leave to join them to the instant action. Thus, without limitation, unknown “John Doe” 

Defendants 21-30 include, but are not limited to, Mercy Health officers and employees who 

are/were fiduciaries of the Plan within the meaning of ERISA Section 3(21)(A), 29 U.S.C. § 

1002(21)(A), during the Class Period.

22. The Plan is a “defined contribution” pension plan under 29 U.S.C. § 1102(2)(A) 

and 1002(34), meaning that Mercy Health’s contribution to the payment of Plan costs is 

guaranteed but the pension benefits are not. In a defined contribution plan, the value of 

participants’ investments is “determined by the market performance of employee and employer 

contributions, less expenses.” Tibble, 135 S. Ct.at 1826. Thus, the employer has no incentive to 

keep costs low or to closely monitor the Plan to ensure every investment remains prudent, 

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because all risks related to high fees and poorly-performing investments are borne by the 

participants.

23. Currently, the Plan has about $500,000,000 in assets entrusted to the care of the 

Plan’s fiduciaries. The Plan had substantial bargaining power regarding the fees and expenses 

that were charged against participants’ investments. Defendants, however, did not try to reduce 

the Plan’s expenses or exercise appropriate judgment to monitor each investment option to 

ensure it was a prudent choice. 

24. With 9,853 participants in the year 2017, Mercy Health Plan had more 

participants than 99.83% of defined contribution plans in the United States who filed 5500 forms 

for the 2017 plan year. Similarly, with $475,516,723 assets in the year 2017, Mercy Health Plan 

had more assets than 99.70% of defined contribution plans in the United States who filed 5500 

forms for the 2017 plan year.

ERISA’S FIDUCIARY STANDARDS

25. ERISA imposes strict fiduciary standards of loyalty and prudence on Defendants

as Plan Fiduciaries. 29 U.S.C. § 1104(a)(1) provides in relevant part:

[A] fiduciary shall discharge his duties with respect to a plan solely in the 

interest of the participants and beneficiaries and –

(A) for the exclusive purpose of:

(i) providing benefits to participants and their beneficiaries; 

and

(ii) defraying reasonable expenses of administering the 

plan; [and]

(B) with the care, skill, prudence, and diligence under the 

circumstances then prevailing that a prudent man acting in a like 

capacity and familiar with such matters would use in the conduct 

of an enterprise of like character and with like aims.

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26. With certain exceptions, 29 U.S.C. § 1103(c)(1) provides in relevant part:

[T]he assets of a plan shall never inure to the benefit of any employer and 

shall be held for the exclusive purposes of providing benefits to 

participants in the plan and their beneficiaries and defraying reasonable 

expenses of administering the plan.

27. 29 U.S.C. § 1109 provides in relevant part:

Any person who is a fiduciary with respect to a plan who breaches any of 

the responsibilities, obligations, or duties imposed upon fiduciaries by this 

subchapter shall be personally liable to make good to such plan any losses 

to the plan resulting from each such breach, and to restore to such plan any 

profits of such fiduciary which have been made through use of assets of 

the plan by the fiduciary, and shall be subject to such other equitable or 

remedial relief as the court may deem appropriate, including removal of 

such fiduciary.

28. Under ERISA, fiduciaries that exercise any authority or control over plan assets, 

including the selection of plan investments and service providers, must act prudently and for the 

exclusive benefit of participants in the plan, and not for the benefit of third parties including 

service providers to the plan such as recordkeepers and those who provide investment products. 

Fiduciaries must ensure that the amount of fees paid to those service providers is no more than 

reasonable. DOL Adv. Op. 97-15A; DOL Adv. Op. 97-16A; see also 29 U.S.C. §1103(c)(1) 

(plan assets “shall be held for the exclusive purposes of providing benefits to participants in the 

plan and their beneficiaries and defraying reasonable expenses of administering the plan”). 

29. “[T]he duty to conduct an independent investigation into the merits of a particular 

investment” is “the most basic of ERISA’s investment fiduciary duties.” In re Unisys Savings 

Plan Litig., 74 F.3d 420, 435 (3d Cir. 1996); Katsaros v. Cody, 744 F.2d 270, 279 (2nd Cir. 

1984) (fiduciaries must use “the appropriate methods to investigate the merits” of plan 

investments). Fiduciaries must “initially determine, and continue to monitor, the prudence of 

each investment option available to Plan Participants.” DiFelice v. U.S. Airways, Inc., 497 F.3d 

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410, 423 (4th Cir. 2007); (emphasis original); 29 C.F.R. § 2550.404a-1; DOL Adv. Opinion 98-

04A; DOL Adv. Opinion 88-16A. Thus, a defined contribution Plan Fiduciary cannot “insulate 

itself from liability by the simple expedient of including a very large number of investment 

alternatives in its portfolio and then shifting to the participants the responsibility for choosing 

among them.” Hecker v. Deere & Co., 569 F.3d 708, 711 (7th Cir. 2009). Fiduciaries have “a 

continuing duty to monitor investments and remove imprudent ones[.]” Tibble, 135 S. Ct. at 

1828-29. 

30. “Wasting beneficiaries’ money is imprudent. In devising and implementing 

strategies for the investment and management of trust assets, trustees are obligated to minimize 

costs.” Uniform Prudent Investor Act § 7.

31. 29 U.S.C. § 1132(a)(2) authorizes Plan Participants to bring a civil action for 

appropriate relief under 29 U.S.C. § 1109.

DEFINED CONTRIBUTION INDUSTRY

32. Over the past three decades, defined contribution plans have become the most 

common employer-sponsored retirement plan. A defined contribution plan allows employees to 

make pre-tax elective deferrals through payroll deductions to an individual account under the 

plan. Among many options, employers may make contributions on behalf of all employees 

and/or make matching contributions based on the employees’ elective deferrals. Employees with 

money in the plan are referred to as participants. 

Recordkeeping and Related Administrative Services

33. Recordkeeping and related administrative (“RK&A”) services are necessary for 

all defined contribution plans. These services include, but are not limited to, those related to 

maintaining plan records, tracking participant account balances and investment elections, 

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transaction processing, call center support, participant communications, and trust and custody

services.

34. Third-party service providers, often known as “recordkeepers,” provide RK&A 

services on behalf of a defined contribution plan. Some recordkeepers provide only 

recordkeeping and related services and some recordkeepers are subsidiaries of financial services 

and insurance companies that distribute mutual funds, insurance products, and other investment 

options.

35. The market for defined contribution recordkeeping services is highly competitive, 

particularly for a Plain like Defendants’ with large numbers of participants and large amounts of 

assets. 

36. Since at least the mid-2000s, the market rate that Plan Fiduciaries have paid for 

fees for RK&A services has decreased. 

37. The underlying cost to a recordkeeper of providing the RK&A services to a 

defined contribution plan is primarily dependent on the number of participant accounts in the 

plan rather than the amount of assets in the plan. 

38. The incremental cost for a recordkeeper to provide RK&A services for a 

participant’s account does not materially differ from one participant to another and is generally 

not dependent on the balance of the participant’s account.

39. The Plan is larger than 99% of all ERISA-covered defined contribution plans in 

the United States as measured by both participants and assets.

40. Recordkeepers for relatively larger defined contribution plans, like the Plan here,

experience certain efficiencies of scale that lead to a reduction in the per-participant cost as the 

number of participants increase because the marginal cost of adding an additional participant to a 

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recordkeeping platform is relatively low. These economies of scale are inherent in all 

recordkeeping arrangements for defined contribution plans. When the number of participants 

with an account balance increases in a defined contribution plan, the recordkeeper is able to 

spread the cost of providing recordkeeping services over a larger participant base, thereby 

reducing the unit cost of delivering services on a per-participant basis.

41. Therefore, while the total cost to a provider for RK&A services increases as more 

participants join the plan, the cost per participant to deliver the services decreases. 

42. Since at least the early 2000s, Plan Fiduciaries and their consultants and advisors 

have been aware of this cost structure dynamic for RK&A providers.

43. Since at least the early 2000s, Defendants were aware of this cost structure 

dynamic for RK&A providers.

44. Sponsors of defined contribution plans contract for RK&A services separately 

from any contracts related to the provision of investment management services to Plan 

Participants. 

45. The investment options selected by Plan Fiduciaries often have a portion of the 

total expense ratio allocated to the provision of recordkeeping services that the recordkeeper 

provides on behalf of the investment manager, e.g., RK&A services. 

46. As a result, RK&A service providers often make separate contractual 

arrangements with mutual fund providers. RK&A providersthen collect a portion of the investment 

management fees in return for providing services that would otherwise have to be provided by 

the mutual fund. 

47. The fees described in the aforementioned paragraph are known in the defined 

contribution industry as “revenue sharing.” 

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48. For example, if a mutual fund has a total expense ratio of 0.75%, the mutual fund 

provider may agree to pay the RK&A provider 0.25% of the 0.75% fee that is paid by the 

investor in that mutual fund (in this context the Plan Participant). That 0.25% portion of the 

0.75% fee is known as the “revenue sharing.” 

49. In the context of defined contribution plans, the amount of revenue sharing is 

deemed to be the amount of revenue paid by participants that is allocable to RK&A services and, 

in some cases, other services provided to the plan. The difference between the total expense ratio 

and the revenue sharing is known as the “net investment management fee” or the “net investment 

expense.”

50. In the context of defined contribution plans, when a plan adopts prudent and best 

practices, the net investment expense is the actual amount a Plan Participant pays for the 

investment management services provided by a portfolio manager. 

51. Providers of Retirement Plan Services, including RK&A services, typically 

collect their fees through direct payments from the plan or through indirect compensation such as 

revenue sharing, or some combination of both.

52. Regardless of the pricing structure that the Plan Fiduciary negotiates with the 

recordkeeper, the amount of compensation paid to the recordkeeper for the RK&A services must 

be reasonable. 

53. As a result, Plan Fiduciaries must understand the total dollar amounts paid to their 

RK&A provider and be able to determine whether the compensation is reasonable by 

understanding what the market is for the RK&A services received by the Plan.

54. Because RK&A fees are actually paid in dollars and because of the cost dynamic 

noted in the aforementioned paragraphs, the fees paid for RK&A services are evaluated and 

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compared on a dollar per participant basis. 

55. It is well known among retirement plan consultants and advisors (who often act as 

co-fiduciaries to the Plan Fiduciaries) that, all else being equal, a plan with more participants can 

and will receive a lower effective per participant fees when evaluated on a per participant basis.

56. During the Class Period, Defendants knew and/or were aware that a plan with 

more participants can and will receive a lower effective per participant fee when evaluated on a 

per participant basis.

57. During the Class Period, Defendants knew and/or were aware that the Plan could

and would receive a lower effective per participant fee when evaluated on a per participant basis.

58. Plan Fiduciaries of a defined contribution plan have a continuing and regular 

responsibility to select and monitor all investment options they make available to Plan 

Participants.

Investments

59. The primary purpose in selecting plan investments is to give all participants the 

opportunity to create an appropriate asset allocation under modern portfolio theory by providing 

diversified investment alternatives. 

60. In selecting different investment options to make available to Plan Participants, 

the Plan Fiduciaries are held to the prudent investor standard when choosing investment 

managers or, alternatively, choosing index investment options. When choosing an active 

investment option, the analysis is focused on determining whether the portfolio manager is likely 

to outperform an appropriate benchmark. 

61. Accordingly, the primary focus when choosing an active investment option to 

make available to Plan Participants is the skill of the portfolio manager. In many cases a plan 

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sponsor can receive the investment management services of the same portfolio manager through 

different share classes. When the same investment management services are provided through a 

mutual fund with different share classes, the fee paid to the portfolio manager is the same for all 

share classes. The difference in the share class fees is the amount of additional fees which can be 

used to pay for, among other things, RK&A services. 

62. A Plan Fiduciary choosing a more expensive way to provide identical services of 

the same portfolio manager must have a rational and informed reason. The Plan Fiduciaries must 

make an explicit finding that the more expensive option is in the best interest of Plan 

Participants. 

THE PLAN 

63. Started on July 1, 1991, the Plan now has had more than 11,000 participants and 

assets of approximately $500,000,000. More specifically, at the end of the year 2018, the Plan 

had approximately 11,006 participants and approximately $482,449,647 in assets. During the 

Class Period (from August 6, 2014 through the date of judgment), Defendants maintained an 

investment platform that offered about 120 different investment choices to its participants, 

including 19 Target Date Funds, 24 other actively managed funds, 8 index funds, 1 variable 

annuity account, and at least 2 self-directed brokerage accounts.

64. At all relevant times, the Plan’s fees were excessive when compared with other 

comparable 401(k) and 403(b) plans offered by other sponsors with similar numbers of Plan 

Participants during this same time period and with similar amounts of money under management.

65. At all relevant times, the Plan’s excessive fees led to lower net returns than 

participants enjoyed in comparable 401(k) and 403(b) plans offered by other sponsors with

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similar numbers of Plan Participants during this same time period and with similar amounts of 

money under management.

66. During the Class Period, Defendants breached their duties owed to the Plan, to 

Plaintiff, and to all other Plan Participants, by: (1) failing to objectively, reasonably, and 

adequately review the Plan’s investment portfolio with due care to ensure that each investment 

option was prudent, in terms of cost; and (2) unreasonably maintaining certain funds in the Plan 

despite the availability of identical or similar investment options with lower costs and/or better 

performance histories. Defendants also failed to use the lowest cost share class or lower cost 

collective trusts for many of the mutual funds within the Plan.

67. Defendants’ mismanagement of the Plan, to the detriment of Plan Participants and 

beneficiaries, breached the fiduciary duties of prudence and loyalty in violation of 29 U.S.C. § 

1104.

68. In addition, ERISA § 405(a), 29 U.S.C. § 1105(a) (entitled “Liability for breach by 

co-fiduciary”) provides that:

[I]n addition to any liability which he may have under any 

other provision of this part, a fiduciary with respect to a plan

shall be liable for a breach of fiduciary responsibility of 

another fiduciary with respect to the same plan in the 

following circumstances: (A) if he participates knowingly 

in, or knowingly undertakes to conceal, an act or omission 

of such other fiduciary, knowing such an act or omission is 

a breach; (B) if, by his failure to comply with section 

404(a)(1), 29 U.S.C. §1104(a)(1), in the administration of 

his specific responsibilities which give rise to his status as a 

fiduciary, he has enabled such other fiduciary to commit a 

breach; or (C) ifhe has knowledge of a breach by such other

fiduciary, unless he makes reasonable efforts under the 

circumstances to remedy the breach.

69. As discussed below, Defendants breached fiduciary duties to the Plan and its 

participants and beneficiaries and are liable for their breaches and the breaches of their cofiduciaries under 29 U.S.C. § 1104(a)(1) and 1105(a).

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STANDARD OF CARE FOR PRUDENT FIDUCIARIES 

SELECTING & MONITORING RECORDKEEPERS

70. A Plan Fiduciary is required to fully understand all sources of revenue received 

by its RK&A service provider/recordkeeper. It must regularly monitor that revenue to ensure that 

the compensation received by the recordkeeper is and remains reasonable for the services

provided.

71. Prudent Plan Fiduciaries ensure they are paying only reasonable fees for RK&A 

services by soliciting competitive bids from other service providers to perform the same services 

currently being provided to the plan. This is not a difficult process and is performed regularly by 

Plan Fiduciaries. Plan Fiduciaries need only request a bid from salespeople at other service 

providers. For plans with as many participants as Defendants’ Plan, most recordkeepers would 

require only the number of participants and the amount of the assets to provide a quote while 

others might only require the number of participants. 

72. Prudent Plan Fiduciaries have all of this information readily available and can 

easily receive a quote from other service providers to determine if the current level of fees is 

reasonable.

73. Having received bids, the prudent Plan Fiduciary can negotiate with its current 

provider for a lower fee and/or move to a new provider to provide the same (or better) services 

for a competitive reasonable fee. 

74. Prudent Plan Fiduciaries can follow this same process for retirement plan advisors 

and/or consultants as well as any other covered service providers.

75. A prudent Plan Fiduciary uses a per-participant revenue requirement pricing 

structure. Under this structure, the Plan Fiduciary and service provider negotiate a fixed per 

participant threshold. In other words, the recordkeeper’s fee for providing RK&A services is a 

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fixed amount per participant, e.g., $45.00 per participant. For example, according to the DC 

Callan Trend Surveys, “Explicit per participant dollar fee,” the following percentage of plans 

were charged on a per-participant basis for the following calendar years: (1) for the year 

2016: 41.6% of plans were charged on a per-participant basis; (2) for the year 2017: 54.7% of 

plans were charged on a per-participant basis; (3) for the year 2018: 63.8% of plans were 

charged on a per-participant basis; and (4) for the year 2019: 64.9% of plans were charged on a 

per-participant basis. 

76. After the revenue requirement is negotiated, the Plan Fiduciary determines how to 

pay the negotiated RK&A fee. The employer/plan sponsor can pay the recordkeeping fee on 

behalf of participants, which is the most beneficial to Plan Participants. If the employer were 

paying the fee, the employer would have an interest in negotiating the lowest fee a suitable 

recordkeeper would accept. Usually, however, the employer decides to have the Plan (Plan 

Participants) pay the recordkeeping fee instead. If the recordkeeping fee is paid by Plan 

Participants, the Plan Fiduciary can allocate the negotiated recordkeeping fee among participant 

accounts at the negotiated per-participant rate, or pro-rata based on account values, among other 

less common ways. 

77. In other words, if the Plan negotiates a per participant revenue threshold, e.g., 

$45.00, the plan does not need to require that each participant pay $45.00. Rather, the Plan 

Fiduciary could determine that an asset-based fee is more appropriate for Plan Participants and 

allocate the RK&A fee pro rata to participants. For example, a 10,000-participant plan with a 

$45.00 revenue threshold would pay $450,000 for RK&A services. If the plan had $450,000,000 

in assets, then the $450,000 would work out to 10 basis points. Accordingly, the Plan Fiduciary

could allocate the $450,000 to Plan Participants by requiring that each participant pay 10 basis 

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points. 

78. In an asset-based pricing structure, the amount of compensation received by the 

service provider is based on a percentage of the total assets in the plan. This structure creates 

situations in which the services provided by the recordkeeper do not change but, because of 

market appreciation and contributions to the plan, the revenue received by the recordkeeper 

increases. This structure was historically preferred by recordkeepers because it allowed 

recordkeepers to obtain an increase in revenue without having to ask the client to pay a higher 

fee.

79. Regardless of the pricing structure negotiated by the Plan Fiduciary, the Plan 

Fiduciary must ensure that the fee paid to the recordkeeper is reasonable for the level of services 

provided.

80. All of these standards were accepted and understood by Plan Fiduciaries, 

including Defendants, at all times during the Class Period. 

81. For example, fiduciary best practices based on DOL guidelines, case law, and 

marketplace experience are as follows:

1. Price administrative fees on a per-participant basis.

2. Benchmark and negotiate recordkeeping and investment fees 

separately.

3. Benchmark and negotiate investment fees regularly, considering both 

fund vehicle and asset size.

4. Benchmark and negotiate recordkeeping and trustee fees at least every 

other year. . . .

7. Review services annually to identify opportunities to reduce 

administrative costs.3

3 “Fiduciary Best Practices,” DC Fee Management — Mitigating Fiduciary Risk and Maximizing Plan Performance,

Mercer Investment Consulting (2013).

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 18 of 76 PageID #:18
82. Defendants’ recordkeeper during the Class Period, Voya Retirement Insurance 

and Annuity Company (“Voya”), is well known as a high cost recordkeeper and administrator

and tends to have platforms that encourage higher fee funds.

83. Prudent fiduciaries implement three related processes to prudently manage and 

control a plan’s recordkeeping costs. Tussey v. ABB, Inc., 746 F.3d 327, 336 (8th Cir. 2014) 

(holding that fiduciaries of a 401(k) plan “breach[] their fiduciary duties” when they “fail[] to 

monitor and control recordkeeping fees” incurred by the plan); George v. Kraft Foods Glob., 

Inc., 641 F.3d 786, 800 (7th Cir. 2011) (explaining that defined contribution Plan Fiduciaries

have a “duty to ensure that [the recordkeeper’s] fees [are] reasonable”). 

84. First, a Plan Fiduciary must pay close attention to the recordkeeping fees being 

paid by the plan. A prudent fiduciary tracks the recordkeeper’s expenses by demanding 

documents that summarize and contextualize the recordkeeper’s compensation, such as fee 

transparencies, fee analyses, fee summaries, relationship pricing analyses, cost-competitiveness 

analyses, and multi-practice and standalone pricing reports.

85. Second, to make an informed evaluation as to whether a recordkeeper or other 

service provider is receiving no more than a reasonable fee for the services provided to a plan, a 

prudent fiduciary must identify all fees, including direct compensation and revenue sharing being 

paid to the plan’s recordkeeper. To the extent that a plan’s investments pay asset-based revenue 

sharing to the recordkeeper, prudent fiduciaries monitor the amount of the payments to ensure 

that the recordkeeper’s total compensation from all sources does not exceed reasonable levels, 

and require that any revenue sharing payments that exceed a reasonable level be returned to the 

plan and its participants. 

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 19 of 76 PageID #:19
86. Third, the plan’s fiduciaries must remain informed about overall trends in the 

marketplace regarding the fees being paid by other plans, as well as the recordkeeping rates that 

are available. This will generally include conducting a Request for Proposal (“RFP”) process at 

reasonable intervals, and immediately if the plan’s recordkeeping expenses have grown 

significantly or appear high in relation to the general marketplace. More specifically, an RFP 

should happen at least every three (3) to five (5) years as a matter of course, and more frequently 

if the plans experience an increase in recordkeeping costs or fee benchmarking reveals the 

recordkeeper’s compensation to exceed levels found in other, similar plans.

THE PLAN’S FIDUCIARIES DID NOT EFFECTIVELY MONITOR RK&A FEES AND, 

AS A RESULT, THE PLAN PAID UNREASONABLE RK&A FEES

87. A Plan Fiduciary must continuously monitor its RK&A fees by regularly 

soliciting competitive bids to ensure fees paid to covered service providers (such as 

recordkeepers) are reasonable.

88. During the Class Period, Defendants knew or should have known that they must 

regularly monitor the Plan’s RK&A fees paid to covered service providers, including but not 

limited to Voya.

89. During the Class Period, Defendants failed to regularly monitor the Plan’s RK&A 

fees paid to covered service providers, including but not limited to Voya.

90. During the Class Period, Defendants knew or should have known that they must 

regularly solicit quotes and/or competitive bids from covered service providers, including but not 

limited to Voya, in order to avoid paying unreasonable fees for RK&A services.

91. During the Class Period, Defendants failed to regularly solicit quotes and/or 

competitive bids from covered service providers, including but not limited to Voya, in order to

avoid paying unreasonable fees for RK&A services.

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92. During the Class Period, Defendants knew or should have known that it was in 

the best interests of the Plan’s Participants to ensure that the Plan paid no more than a 

competitive reasonable fee for RK&A services.

93. During the Class Period, Defendants failed to ensure that the Plan paid no more 

than a competitive reasonable fee for RK&A services.

94. During the Class Period, Defendants did not have a plan or process in place to 

ensure that the Plan paid no more than a competitive reasonable fee for RK&A services.

95. During the Class Period, Defendants did not engage in any objectively reasonable

and/or prudent efforts to ensure that the Plan paid no more than a competitive reasonable fee for 

RK&A services.

96. During the Class Period and because Defendants failed to regularly monitor the 

Plan’s RK&A fees paid to covered service providers, including but not limited to Voya, these 

RK&A service fees were significantly higher than they would have been had Defendants 

engaged in this process.

97. During the Class Period and because Defendants did not solicit quotes and/or 

competitive bids from covered service providers, including but not limited to Voya, before 

and/or when paying fees for RK&A services, these RK&A service fees were significantly higher 

than they would have been had Defendants engaged in these processes.

98. During the Class Period and because Defendants did not engage in any 

objectively reasonable and/or prudent efforts when paying fees for RK&A services to covered 

service providers, including but not limited to Voya, these RK&A service fees were significantly 

higher than they would have been had Defendants engaged in these efforts.

99. Specifically, and for example, during the year 2018, the following graph and table 

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 21 of 76 PageID #:21
illustrate that the Plan’s RK&A fees were significantly higher as compared to other 401(k) and 

403(b) plans of similar sizes with similar amounts of money under management during this same 

period of time.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 22 of 76 PageID #:22
100. The underlying data and information reflected in the graph and table above are 

truthful, accurate, and derived from publically available information, which was equally as 

available to Defendants during the Class Period, including the most recent Form 5500 filings and 

accompanying attachments by Defendants and the other entities and plans listed therein, some of 

whom are healthcare companies like Defendants who used the same recordkeeper, Voya.

101. As the above graph and table illustrate, during the year 2018, a reasonable market 

rate RK&A fee would have been between approximately $40.00 and $50.00 per participant.

102. As the above graph and table illustrate, during the year 2018, other plans of 

similar sizes with similar amounts of money under management as compared to the Plan paid 

recordkeepers an average of approximately $536,914, or approximately $48.83 per participant.

103. As the above graph and table illustrate, during the year 2018, the Plan paid 

RK&A fees to Voya totaling approximately $1,294,361, or approximately $118.00 per 

Comparative Plans' RK&A Fees Based on Publicly Available Information from Form 55001

Plan Participants Assets RK&A Price

RK&A 

Price /pp Recordkeeper

Graph 

Color

Waste Connections, Inc. 401k Profit 

Sharing Plan 7,923 $332,567,264 $455,853 $58 Voya Orange

Centerpoint Energy Savings Plan 9,802 $2,108,802,293 $442,946 $45 Voya Orange

Edward- Elmhurst Healthcare 

Retirement Savings Plan 10,263 $618,238,970 $446,836 $44 Fidelity Blue

Lancaster General Health Retirement Income 

403(b) Account 10,273 $498,737,886 $561,490 $55 Prudential Blue

Flowers Foods, Inc. 401(k) Retirement 

Savings Plan 10,789 $607,338,501 $683,296 $49 Great-West Blue

Mercy Health Corporation Employees 

Retirement Plan 11,006 $482,212,863 $1,294,361 $118 Voya Red

Multicare Health System 403(B) 

Employee Savings Plan 11,437 $559,801,095 $556,202 $49 Transamerica Blue

Dollar General Corp 401(k) Savings and 

Retirement Plan 16,125 $355,768,325 $611,776 $32 Voya Orange

1

Price calculations are based on most recent complete Form 5500 available (all using 2018 with the exception of 

Dollar General using 2017 as the 2018 Financial Statement attachment is not available)

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 23 of 76 PageID #:23
participant, more than double the amount that other plans of similar sizes with similar amounts of 

money under management paid to other recordkeepers, including but not limited to Defendants’ 

same recordkeeper, Voya, during the year 2018.

104. During the year 2018, a prudent Plan Fiduciary would not have agreed to pay 

more than double what they could otherwise have paid for the same services from, in some 

instances and as identified in the graph and table above, the exact same covered service provider.

105. During the year 2018 and had Defendants been acting in the best interests of the 

Plan’s Participants – and as compared to other plans of similar sizes with similar amounts of 

money under management as identified in the graph and table above – the Plan actually would 

have paid less than double in RK&A fees.

106. During the entirety of the Class Period, Defendants did not use its size to bargain 

or negotiate with covered service providers and recordkeepers, including but not limited to Voya, 

to defray or reduce administrative costs and RK&A fees to the Plan’s Participants.

107. During the entirety of the Class Period and because Defendants did not use its size 

to bargain or negotiate with covered service providers and recordkeepers, including but not 

limited to Voya, to defray or reduce administrative costs and RK&A fees to the Plan’s 

Participants, Defendants acted imprudently and unreasonable.

108. During the entirety of the Class Period and because Defendants did not use its size 

to bargain or negotiate with covered service providers and recordkeepers, including but not 

limited to Voya, to defray or reduce administrative costs and RK&A fees to the Plan’s 

Participants, Defendants did not act in the best interests of the Plan’s Participants.

109. From the years 2014 to 2018 during the Class Period and based upon the best 

available truthful, accurate, and publically available information, which was equally as available 

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 24 of 76 PageID #:24
to Defendants during the Class Period, the Plan paid an average amount of at least approximately 

$899,218 per year in RK&A fees, which equated to an average of at least approximately $99.00

per participant per year, as identified in the following chart:

110. From the years 2014 to 2018 during the Class Period and based upon the best 

available truthful, accurate, and publically available information, which was equally as available 

to Defendants during the Class Period, had Defendants been acting in the best interests of the 

Plan’s Participants – and as compared to other plans of similar sizes with similar amounts of 

money under management – the Plan actually would have paid significantly less than an average 

of approximately $899,218 per year in RK&A fees, which equated to an average of 

approximately $99.00 per participant per year.

111. From the years 2014 to 2018 during the Class Period and based upon the best 

available truthful, accurate, and publically available information, which was equally as available 

to Defendants during the Class Period, had Defendants been acting in the best interests of the 

Plan’s Participants – and as compared to other plans of similar sizes with similar amounts of 

money under management – the Plan actually would have paid a reasonable market rate of 

approximately $433,000 per year in RK&A fees, which equates to approximately $46.00 per 

participant per year.

112. During the entirety of the Class Period, a prudent Plan Fiduciary would not agree 

to pay more than double what they could otherwise pay for the same services from, in some 

instances, the exact same covered service provider.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 25 of 76 PageID #:25
113. From the years 2014 to 2018 during the Class Period and based upon the best 

available truthful, accurate, and publically available information, which was equally as available 

to Defendants during the Class Period, because Defendants did not act in the best interests of the 

Plan’s Participants – and as compared to other plans of similar sizes with similar amounts of 

money under management – the Plan actually cost its Participants approximately $466,218 per 

year in RK&A fees, which equates to approximately $53.00 per participant per year.

114. From the years 2014 to 2018 during the Class Period and because Defendants did 

not act in the best interests of the Plan’s Participants – and as compared to other plans of similar 

sizes with similar amounts of money under management – the Plan actually cost its Participants a 

total minimum amount of approximately $2,797,308 in RK&A fees.

115. During the entirety of the Class Period and based upon the best available truthful, 

accurate, and publically available information, which was equally as available to Defendants 

during the Class Period, because Defendants did not act in the best interests of the Plan’s 

Participants – and as compared to other plans of similar sizes with similar amounts of money 

under management – the Plan actually cost its Participants (when accounting for compounding 

percentages) a total, cumulative amount in excess of $4,200,000 in RK&A fees.

116. During the entirety of the Class Period, Defendants did not regularly and/or 

reasonably assess, in any way, the Plan’s administrative costs and RK&A fees it paid to Voya.

117. During the entirety of the Class Period, Defendants did not engage in any regular 

and/or reasonable examination, comparison, or benchmarking of the Plan’s administrative costs 

and RK&A fees it paid to Voya vis-à-vis the administrative costs and RK&A fees that other

plans of similar sizes with similar amounts of money under management paid to their covered 

service providers – who, in some instances, was Voya, the exact same provider as utilized by 

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 26 of 76 PageID #:26
Defendants during the entirety of the Class Period.

118. During the entirety of the Class Period, Defendants knew or had knowledge that it 

must engage in regular and/or reasonable examination, comparison, or benchmarking of the 

Plan’s administrative costs and RK&A fees it paid to Voya, but Defendants simply failed to do 

so in any meaningful way whatsoever.

119. During the entirety of the Class Period and had Defendants engaged in any 

regular and/or reasonable examination, comparison, or benchmarking of the Plan’s 

administrative costs and RK&A fees it paid to Voya, it would have realized and understood that 

the Plan was compensating Voya unreasonably and inappropriately for its size and scale, passing 

these unreasonable and excessive fee burdens to Plaintiff and the Plan Participants

120. During the entirety of the Class Period and by failing to recognize that the Plan 

and its participants were being charged much higher administrative costs and RK&A fees than 

they should have been and/or by failing to take effective remedial actions as described herein, 

Defendants breached their fiduciary duties to Plaintiff and the Plan Participants.

STANDARD OF CARE FOR PRUDENT FIDUCIARIES SELECTING & 

MONITORING INVESTMENT OPTIONS

121. There is a commonly accepted process to select and monitor investment options 

which is based on modern portfolio theory and the prudent investor standard. Under ERISA, Plan 

Fiduciaries are required to engage investment consultants or advisors to the extent that the Plan 

Fiduciaries do not have the investment expertise necessary to select and monitor investments 

under modern portfolio theory.

122. That accepted process involves, among other things, evaluating the performance 

history, tenure, and stability of the current portfolio manager; the risk adjusted returns; and the 

fees.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 27 of 76 PageID #:27
123. When an active investment option is chosen, one of the most critical aspects of 

the analysis is to choose a portfolio manager because it is the skill of the portfolio manager that 

differentially impacts the performance of the investment. 

124. From the perspective of a Plan Participant, the other critical component of the 

analysis is the fees. However, the total expense ratio of an investment option is often comprised 

of multiple different types of fees, only one of which is specifically associated with the fee of the 

actual portfolio manager. 

125. As a result, a Plan Fiduciary is required to understand the interrelationship 

between the pricing structure it has negotiated with the recordkeeper for RK&A services as well 

as the different fee components of the investment options selected to be made available to Plan 

Participants. 

126. When a Plan Fiduciary can choose among different share classes (or other types 

of investment options, e.g., collective trusts) to receive the services of a specific portfolio 

manager, the Plan Fiduciary is required to understand all the fees related to the different share 

classes and choose the share class that is in the best interest of the Plan Participants. This is 

especially critical when the pricing structure provides compensation to the recordkeeper from 

revenue sharing paid by Plan Participants as part of the total expense ratio of the investment 

options selected by the Plan Fiduciaries.

127. If the RK&A pricing structure includes a revenue threshold, then a prudent Plan 

Fiduciary must choose the share class with the lowest net investment management fee. If the 

pricing structure does not include a revenue threshold, then a prudent Plan Fiduciary must ensure 

that the revenue sharing will not result in the payment of an unreasonable fee to the recordkeeper 

for the RK&A services.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 28 of 76 PageID #:28
128. A prudent Plan Fiduciary must ensure that the combination of the RK&A pricing 

structure and the selected share classes together provide the best outcome for Plan Participants.

129. If a Plan Fiduciary chooses an active investment option when an alternative index 

option is available, the Plan Fiduciary must make a specific and informed finding that the 

probability that the active portfolio manager will outperform the index warrants the higher fees 

paid charged by the active portfolio manager and the risk/reward tradeoffs show that the 

potential of outperformance is in the best interest of Plan Participants.

130. If a Plan Fiduciary chooses an active investment option when an alternative index 

option is available, but the Plan Fiduciary does not make a specific and informed finding that the 

probability that the active portfolio manager will outperform the index (and as such warranting

the higher fees paid charged by the active portfolio manager) and the risk/reward tradeoffs show 

that the potential of outperformance is in the best interest of Plan Participants, the Plan Fiduciary 

has acted unreasonably and/or imprudently.

131. In February 2013, the Department of Labor issued guidance for the selection of 

target date funds in a publication titled, “Target Date Retirement Funds – Tips for ERISA Plan 

Fiduciaries.”4 Fiduciaries were given specific guidance to: (i) establish a process for comparing 

and selecting TDFs; (ii) establish a process for the periodic review of TDFs; (iii) understand the 

fund’s investments – the allocation in different asset classes (stocks, bonds, cash), individual 

investments, and how these will change over time; (iv) inquire about whether a custom or nonproprietary target date fund would be a better fit for a plan; and (v) develop effective employee 

communications. 

4 https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/target-dateretirement-funds.pdf

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 29 of 76 PageID #:29
132. The Department of Labor gave a very specific warning about the importance of 

keeping costs under control: “A difference of just one percentage point in fees (1.5% as 

compared with 0.5%) over 35 years dramatically affects overall returns. If a worker with a 

401(k)-account balance of $25,000 averages a seven percent return, the worker will have 

$227,000 at retirement with the lower fee and $163,000 with the higher fee, assuming no further 

contributions.”5

DEFENDANTS’ TARGET DATE FUNDS

133. During the Class Period, Defendants’ target date fund selection featured many 

American Funds target date funds.

134. Defendants chose an unnecessarily higher fee versions of the American Funds

target date funds available, as illustrated by the following chart: 

135. The underlying data and information reflected in the chart above is truthful, 

accurate, and derived from publically available information, which was equally as available to 

Defendants during the Class Period.

136. During the Class Period, Defendants’ selected “American Funds 2035 Target 

Date Retirement Fund R4” to invest the Plan’s assets, as identified in the chart above.

5

 U.S. Department of Labor, Employee Benefits Security Administration, A Look At 401(k) Plan Fees, at 

http://www.dol.gov/ebsa/publications/401k_employee.html

American Funds Target Date Retirement Investment Expenses

Revenue Sharing (12b1 + SubTA)

Ticker Investment Name

Expense 

Ratio Matrix Fidelity MATC TD

Net Investment 

Expense to 

Retirement Plans

RAFTX American Funds 2035 Trgt Date Retire R1 1.51% 1.00% 1.00% 1.00% 1.00% 0.51%

RBFTX American Funds 2035 Trgt Date Retire R2 1.49% 0.75% 0.75% 0.75% 0.75% 0.74%

RCFTX American Funds 2035 Trgt Date Retire R3 1.04% 0.50% 0.50% 0.50% 0.50% 0.54%

RDFTX American Funds 2035 Trgt Date Retire R4 0.74% 0.25% 0.25% 0.25% 0.25% 0.49%

REFTX American Funds 2035 Trgt Date Retire R5 0.44% 0.00% 0.00% 0.00% 0.00% 0.44%

RFFTX American Funds 2035 Trgt Date Retire R6 0.39% 0.00% 0.00% 0.00% 0.00% 0.39%

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 30 of 76 PageID #:30
137. As illustrated in the chart above, the “American Funds 2035 Target Date 

Retirement Fund R4” has an expense ratio of 0.74% and a net investment expense of 0.49%.

138. As illustrated in the chart above, the “American Funds 2035 Target Date 

Retirement Fund R6” has the lowest total expense ratio, 0.39%, and the lowest net investment 

expense, 0.39%.

139. During the Class Period, all of the target date funds identified in the chart above 

received the identical portfolio management services 

140. During the Class Period, the only actual difference between all of the target date 

funds identified in the chart above are the expenses and fees.

141. A prudent Plan Fiduciary would not, and must not, unreasonably pay more in fees 

and expenses related to its target date funds for the identical portfolio management services.

142. During the Class Period, Defendants failed to ensure that the Plan paid no more 

than a reasonable fee for expenses related to its target date funds.

143. During the Class Period, Defendants did not have a plan or process in place to 

ensure that the Plan paid no more than a reasonable fee for expenses related to its target date 

funds.

144. During the Class Period, Defendants did not engage in any objectively reasonable 

and/or prudent efforts to ensure that the Plan paid no more than a reasonable fee for expenses 

related to its target date funds.

145. During the Class Period and had Defendants been acting in the best interests of 

the Plan’s Participants, the Plan would not have selected the “American Funds 2035 Target Date 

Retirement Fund R4,” as identified in the chart above.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 31 of 76 PageID #:31
146. During the Class Period and had Defendants been acting in the best interests of 

the Plan’s Participants, the Plan would have selected the “American Funds 2035 Target Date 

Retirement Fund R6,” as identified in the chart above – or a comparatively similar target date 

fund.

147. During the Class Period and because Defendants did not act in the best interests of 

the Plan’s Participants when selecting the “American Funds 2035 Target Date Retirement Fund 

R4,” as identified in the chart above, Defendants unnecessarily reduced the monetary returns of 

Plaintiff and the Plan Participants investing in this option by at least 5 basis points compounded 

per year.

THE PLAN PAID UNREASONABLY HIGH FEES FOR SHARE CLASSES

148. Many mutual funds offer multiple classes of shares in a single mutual fund that 

are targeted at different investors. Generally, more expensive shares are targeted at small 

investors with less bargaining power, while lower cost shares are targeted at larger investors with 

greater assets. There is no material difference between share classes other than costs – the funds 

hold identical investments and have the same manager.

149. Large defined contribution plans such as the Plan have sufficient assets to qualify 

for lower cost share classes. It is well known among institutional investors that mutual fund 

companies will waive investment minimums for a large plan. 

150. A prudent Plan Fiduciary uses a plan’s asset size and negotiating power to invest 

in low cost share classes available in the market.

151. A prudent Plan Fiduciary engages in an objectively reasonable search for and 

selection of the lowest-priced share classes available in the market.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 32 of 76 PageID #:32
152. During the Class Period, Defendants knew or should have known that it must use 

its asset size and negotiating power to invest in low cost share classes available in the market.

153. During the Class Period, Defendants knew or should have known that it must 

engage in an objectively reasonable search for and selection of the lowest-priced share classes

available in the market.

154. During the Class Period, Defendants did not use its asset size and negotiating 

power to invest in low cost share classes available in the market.

155. During the Class Period, Defendants did not engage in an objectively reasonable 

search for and selection of the lowest-priced share classes available in the market.

156. The following charts identify Defendants’ share class investments during the 

Class Period vis-à-vis more prudent, reasonable, and lower share class alternatives during this 

same time period:

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 33 of 76 PageID #:33
Defendants' Investment Prudent Alternative Share Class

Ticker Fund Name

Exp Ratio 

(%)

Revenue 

Sharing 

(%)

Net 

Investment 

Fee (%) Ticker Fund Name

Exp Ratio 

(%)

Revenue 

Sharing 

(%)

Net 

Investment 

Fee (%)

Defendants' 

Plan's 

Investment 

Excessive 

Fees (%)

RDATX

American Funds 2010 

Tdate R4 0.69% 0.25% 0.44% RFTTX

American Funds 2010 

Trgt Date Retire R6

0.33% 0.00% 0.33% 33%

RDBTX

American Funds 2015 

Tdate R4 0.68% 0.25% 0.43% RFJTX

American Funds 2015 

Trgt Date Retire R6

0.33% 0.00% 0.33% 30%

RDCTX

American Funds 2020 

Tdate R4 0.69% 0.25% 0.44% RRCTX

American Funds 2020 

Trgt Date Retire R6

0.34% 0.00% 0.34% 29%

RDDTX

American Funds 2025 

Tdate R4 0.71% 0.25% 0.46% RFDTX

American Funds 2025 

Trgt Date Retire R6

0.36% 0.00% 0.36% 28%

RDETX

American Funds 2030 

Tdate R4 0.73% 0.25% 0.48% RFETX

American Funds 2030 

Trgt Date Retire R6

0.38% 0.00% 0.38% 26%

RDFTX

American Funds 2035 

Tdate R4 0.74% 0.25% 0.49% RFFTX

American Funds 2035 

Trgt Date Retire R6

0.39% 0.00% 0.39% 26%

RDGTX

American Funds 2040 

Tdate R4 0.75% 0.25% 0.50% RFGTX

American Funds 2040 

Trgt Date Retire R6

0.40% 0.00% 0.40% 25%

RDHTX

American Funds 2045 

Tdate R4 0.75% 0.25% 0.50% RFHTX

American Funds 2045 

Trgt Date Retire R6

0.40% 0.00% 0.40% 25%

RDITX

American Funds 2050 

Tdate R4 0.77% 0.25% 0.52% RFITX

American Funds 2050 

Trgt Date Retire R6

0.41% 0.00% 0.41% 27%

RDJTX

American Funds 2055 

Tdate R4 0.77% 0.25% 0.52% RFKTX

American Funds 2055 

Trgt Date Retire R6

0.42% 0.00% 0.42% 24%

RDKTX

American Funds 2060 

Tdate R4 0.79% 0.25% 0.54% RFUTX

American Funds 2060 

Trgt Date Retire R6

0.41% 0.00% 0.41% 32%

RNWEX

American Funds New 

World R4 0.98% 0.25% 0.73% RNWGX

American Funds New 

World R6 0.62% 0.00% 0.62% 18%

REREX

American Funds 

EuroPacific R4 0.84% 0.25% 0.59% RERGX

American Funds 

Europacific Growth R6 0.49% 0.00% 0.49% 20%

RGAEX

American Funds 

Growth Fund R4 0.68% 0.25% 0.43% RGAGX

American Funds 

Growth Fund of Amer 

R6

0.33% 0.00% 0.33% 30%

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 34 of 76 PageID #:34
157. The underlying data and information reflected in the charts above are truthful, 

accurate, and derived from publically available information, which was equally as available to 

Defendants during the Class Period, including but not limited to Plaintiff’s Plan quarterly 

statements, the Plan’s Summary Description, and the Plan’s fee disclosures.

158. Based upon data and information reflected in the charts above, the average 

excessive fee for Defendants not using a lower-priced, more efficient and/or prudent alternative 

share class during the Class Period was approximately 48%. 

Defendants' Investment Prudent Alternative Share Class

Ticker Fund Name

Exp Ratio 

(%)

Revenue 

Sharing 

(%)

Net 

Investment 

Fee (%) Ticker Fund Name

Exp Ratio 

(%)

Revenue 

Sharing 

(%)

Net 

Investment 

Fee (%)

Defendants' 

Plan's 

Investment 

Excessive 

Fees (%)

RIDEX

American Funds 

Income

0.61% 0.25% 0.36% RIDGX

American Funds 

Income Fund of Amer 

R6

0.26% 0.00% 0.26% 38%

RNPEX

American Funds New 

Perspective R4

0.80% 0.25% 0.55% RNPGX

American Funds New 

Perspective R6

0.45% 0.00% 0.45% 22%

RWMEX

American Funds 

Washington Mutual R4 0.62% 0.25% 0.37%

RWMG

X

American Funds 

Washington Mutual R6 0.27% 0.00% 0.27% 37%

LIBKX

Black Rock Life Path 

Ind 2025 Fund K 0.10% 0.00% 0.10% LIBIX

BlackRock LifePath® 

Index 2025 Instl 0.15% 0.10% 0.05% 100%

LINKX

Black Rock Life Path 

Ind 2030 Fund K 0.10% 0.00% 0.10% LINIX

BlackRock LifePath® 

Index 2030 Instl 0.15% 0.10% 0.05% 100%

LIJKX

Black Rock Life Path 

Ind 2035 Fund K 0.10% 0.00% 0.10% LIJIX

BlackRock LifePath® 

Index 2035 Instl 0.15% 0.10% 0.05% 100%

LIKKX

Black Rock Life Path 

Ind 2040 Fund K 0.10% 0.00% 0.10% LIKIX

BlackRock LifePath® 

Index 2040 Instl 0.15% 0.10% 0.05% 100%

LIHKX

Black Rock Life Path 

Ind 2045 Fund K 0.10% 0.00% 0.10% LIHIX

BlackRock LifePath® 

Index 2045 Instl 0.15% 0.10% 0.05% 100%

LIPKX

Black Rock Life Path 

Ind 2050 Fund K 0.10% 0.00% 0.10% LIPIX

BlackRock LifePath® 

Index 2050 Instl 0.15% 0.10% 0.05% 100%

LIVKX

Black Rock Life Path 

Ind 2055 Fund K 0.09% 0.00% 0.09% LIVIX

BlackRock LifePath® 

Index 2055 Instl 0.14% 0.10% 0.04% 125%

TPINX

Franklin Templeton 

Investments Global 

Bond Fund - Class A

0.94% 0.40% 0.54% TGBAX Templeton Global 

Bond Adv 0.69% 0.25% 0.44% 23%

MGRFX

Mass Mutual 

MassMutual Sel Mid 

Cap Growth Fund R5

0.81% 0.15% 0.66% MEFFX

MassMutual Select 

Mid Cap Growth R4 1.16% 0.75% 0.41% 61%

MEIAX

MFS MFS Value Fund 

Class A 0.83% 0.45% 0.38% MEIHX MFS Value R3 0.83% 0.50% 0.33% 15%

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 35 of 76 PageID #:35
159. During the Class Period and had Defendants used its asset size and negotiating 

power to invest in low cost share classes available in the market, the Plan would not have 

selected the funds in the “Defendants’ Investment” columns of the charts above.

160. During the Class Period and had Defendants used its asset size and negotiating 

power to invest in low cost share classes available in the market, the Plan would have selected 

the funds in the “Prudent Alternative Share Class” columns of the charts above.

161. During the Class Period and had Defendants engaged in an objectively reasonable 

search for and selection of the lowest-priced share classes available in the market, the Plan would 

not have selected the funds in the “Defendants’ Investment” columns of the charts above.

162. During the Class Period and had Defendants engaged in an objectively reasonable 

search for and selection of the lowest-priced share classes available in the market, the Plan would 

have selected the funds in the “Prudent Alternative Share Class” columns of the charts above.

163. During the Class Period and had Defendants been acting in the best interests of 

the Plan’s Participants, the Plan would not have selected the funds in the “Defendants’ 

Investment” columns of the charts above.

164. During the Class Period and had Defendants been acting in the best interests of 

the Plan’s Participants, the Plan would have selected the funds in the “Prudent Alternative Share 

Class” columns of the charts above.

165. During the entirety of the Class Period, Defendants knew or should have known 

about the existence of cheaper or lower-cost share classes as identified in the “Prudent 

Alternative Share Class” columns of the charts above.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 36 of 76 PageID #:36
166. During the entirety of the Class Period, Defendants knew or should have known 

to transfer the Plan funds into the cheaper or lower-cost share classes as identified in the 

“Prudent Alternative Share Class” columns of the charts above. 

167. A prudent fiduciary would not select high-cost share classes when lower-cost 

share classes are available for the same investment.

168. During the entirety of the Class Period, Defendants selected higher-cost share 

classes when lower-cost share classes were available to the Plan for the same investment, to the 

substantial detriment of Plaintiff and the Plan’s Participants.

169. During the entirety of the Class Period and because Defendants selected highercost share classes when lower-cost share classes were available to the Plan for the same 

investment, the Plaintiff and the Plan Participants did not receive any additional services or 

benefits other than a higher cost for Plaintiff and the Plan Participants.

170. As an example of Defendants’ failure to engage in an objectively reasonable 

search for and selection of the lowest-priced share classes available in the market during the 

Class Period, consider the VOYA T. Rowe Price Capital Appreciation Portfolio - Service Class 

(ITCSX) which was selected by the Plan Fiduciaries and made available to Plan Participants in 

the Plan during the entire Class Period. As of year-end 2018, Plan Participants had invested more 

than approximately $27,017,476 in this investment option. The portfolio manager of this 

investment option was David R. Giroux (Giroux). Plan Participants can receive the identical 

investment management services of Giroux through several different investment options (share 

classes) with different fee structures. The fee structures for these varying Capital Appreciation 

investment options (three share classes of one T. Rowe Price mutual fund and the Plan’s 

investment which is a Voya-branded version of the same mutual fund), all managed by Giroux, 

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 37 of 76 PageID #:37
are set forth in the chart below:

171. The underlying data and information reflected in the chart above is truthful, 

accurate, and derived from publically available information, which was equally as available to 

Defendants during the Class Period.

172. Plan Fiduciaries are required under ERISA to understand all the separate 

components of fees for different types of services charged to the plan and Plan Participants. 

173. The second to last row of the chart above, “Actual Revenue Sharing Credit 

Available,” is simply the mathematical difference between the total expense ratio and the 

investment management fee rate. Because each investment option negotiates its “revenue 

sharing” agreement separately with each recordkeeping platform, the revenue sharing rate could

be different on different recordkeeping platforms and may also be larger or smaller than the 

amount indicated in the chart above. Revenue sharing rates are not always disclosed to Plan 

Participants on the Participant fee disclosure documents and, perhaps worse, are not even always 

disclosed on the 5500 forms filed by Plan Fiduciaries.

174. Upon information and belief during the Class Period, the Plan did not use a 

revenue threshold fee structure in which all revenue sharing was returned to the Plan Participants

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 38 of 76 PageID #:38
who generated that revenue. Thus, it would be incorrect to assume that the share class that 

provided the lowest net investment expense in the chart above provided the most value to the 

Plan Participants.

175. As illustrated in the chart above, the fee to receive the exact same investment 

management skills of portfolio manager Giroux are set forth in the “Investment Management 

Expense Fee” row and are the same for all T. Rowe Price share class options (59 basis points) –

except for the actual option chosen by the Plan, which was 5 basis points more expensive (64 

basis points). 

176. A Plan Fiduciary selecting any one of these investment options identified in the 

above chart will receive identical portfolio management services performed by the same 

portfolio manager with the only material difference being the amount of extra fees that are 

included in the total expense ratio that will be paid by Plan Participants.

177. As illustrated in the chart below, which is based on the $27,017,476 that the Plan 

invested in the “Voya T. Rowe Price Capital Appreciation Portfolio- Service Class (ITCSX)” 

during the year 2018, because Defendants did not select cheaper, lower-cost, more prudent share 

classes available to the Plan and within which to invest the Plan’s assets, Defendants caused 

substantial monetary damage and detriment to Plaintiff and the Plan’s Participants.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 39 of 76 PageID #:39
178. The underlying data and information reflected in the chart above is truthful, 

accurate, and derived from publically available information, which was equally as available to 

Defendants during the Class Period.

179. A prudent fiduciary conducting an impartial and objectively reasonable review of 

the Plan’s investments during the Class Period would have conducted a review on at least a 

quarterly basis, which would have identified cheaper, lower-cost, and/or more prudent share 

classes available.

180. A prudent fiduciary conducting an impartial and objectively reasonable review of 

the Plan’s investments during the Class Period would have conducted a review on at least a 

quarterly basis, would have identified cheaper, lower-cost, and/or more prudent share classes 

available, and would have transferred the Plan’s investments into these cheaper, lower-cost, 

and/or institutional shares at the earliest opportunity. 

181. During the entirety of the Class Period, Defendants: did not conduct an impartial 

and objectively reasonable review of the Plan’s investments on at least a quarterly basis; did not 

identify cheaper, lower-cost, more prudent share classes available to the Plan; and did not 

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 40 of 76 PageID #:40
transfer the Plan’s investments into these cheaper, lower-cost, and/or institutional shares, all to 

the substantial detriment of Plaintiff and the Plan’s Participants.

182. During the entirety of the Class Period and by failing to recognize that the Plan 

was invested in higher-cost share classes when lower-cost share classes were available to the 

Plan for the same investment and/or by failing to take effective remedial actions as described 

herein, Defendants breached their fiduciary duties to Plaintiff and the Plan Participants.

DEFENDANTS’ INVESTMENTS IN THE PLAN

183. A prudent fiduciary will consider all plan investments, including “suitable index 

mutual funds or market indexes (with such adjustments as may be appropriate).” Restatement 

(Third) of Trusts § 100 cmt. b(1).

184. While higher-cost mutual funds may outperform a less-expensive option over the 

short term, such as a passively managed index fund, they rarely do so over a longer term. See 

Jonnelle Marte, Do Any Mutual Funds Ever Beat the Market? Hardly, The Washington Post, 

available at https://www.washingtonpost.com/news/get-there/wp/2015/03/17/do-anymutualfunds-ever-beat-the-market-hardly/ (citing a study by S&P Dow Jones Indices that looked 

at 2,862 actively managed mutual funds, focused on the top quartile in performance and found 

most did not replicate performance from year to year); see also Index funds trounce actively 

managed funds: Study, available at http://www.cnbc.com/2015/06/26/index-funds-trounceactivelymanaged-funds-study.html (“long-term data suggests that actively managed funds 

“lagged their passive counterparts across nearly all asset classes, especially over the 10-year 

period from 2004 to 2014.”)

185. Funds with high fees on average perform worse than less expensive funds, even 

on a pre-fee basis. Javier Gil-Bazo & Pablo Ruiz-Verdu, When Cheaper is Better: Fee 

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 41 of 76 PageID #:41
Determination in the Market for Equity Mutual Funds, 67 J. Econ. Behav. & Org. 871, 873 

(2009) (hereinafter “When Cheaper is Better”); see also Jill E. Fisch, Rethinking the Regulation 

of Securities Intermediaries, 158 U. Pa. L. Rev. 1961, 1967-75 (2010) (summarizing numerous 

studies showing that “the most consistent predictor of a fund’s return to investors is the fund’s 

expense ratio”).

186. During the Class Period, Defendants selected and/or made available to the Plan’s 

Participants more than 150 investment options.

187. Upon information and belief and during the Class Period, the more than 150 

investment options that Defendants selected and/or made available to the Plan’s Participants

resulted in the Plan’s Participants subsidizing the RK&A fees of other Participants.

188. During the Class Period, the chart below identifies several investment options that 

Defendants selected and/or made available to Plan Participants as compared to prudent 

alternative and less expensive options. In some instances, the less expensive option provides the 

identical portfolio management services delivered by the same portfolio manager. 

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 42 of 76 PageID #:42
Defendants' Investment Prudent Alternative Investments

Ticker Fund Name

Exp Ratio 

(%) Ticker Fund Name

Exp Ratio 

(%)

Defendants' 

Plan's 

Investment 

Excessive 

Fees (%)

AMIGX

Amana Growth Fund 

R4

0.79% FSPGX Fidelity® Large Cap 

Growth Idx 0.03% 2533%

AMINX Amana Income Fund 0.82% FXAIX Fidelity® 500 Index 0.02% 4000%

RDATX

American Funds 2010 

Tdate R4 0.69% VITRX Vanguard Instl Trgt Retire Inc Instl 0.09% 667%

RDBTX

American Funds 2015 

Tdate R4 0.68% VITVX Vanguard Instl Trgt Retire 2015 Instl 0.09% 656%

RDCTX

American Funds 2020 

Tdate R4 0.69% VITWX Vanguard Instl Trgt 

Retire 2020 Instl 0.09% 667%

RDDTX

American Funds 2025 

Tdate R4 0.71% VRIVX Vanguard Instl Trgt 

Retire 2025 Instl 0.09% 689%

RDETX

American Funds 2030 

Tdate R4 0.73% VTTWX Vanguard Instl Trgt Retire 2030 Instl 0.09% 711%

RDFTX

American Funds 2035 

Tdate R4 0.74% VITFX Vanguard Instl Trgt Retire 2035 Instl 0.09% 722%

RDGTX

American Funds 2040 

Tdate R4 0.75% VIRSX Vanguard Instl Trgt Retire 2040 Instl 0.09% 733%

RDHTX

American Funds 2045 

Tdate R4 0.75% VITLX Vanguard Instl Trgt Retire 2045 Instl 0.09% 733%

RDITX

American Funds 2050 

Tdate R4 0.77% VTRLX Vanguard Instl Trgt Retire 2050 Instl 0.09% 756%

RDJTX

American Funds 2055 

Tdate R4 0.77% VIVLX Vanguard Instl Trgt Retire 2055 Instl 0.09% 756%

RDKTX

American Funds 2060 

Tdate R4 0.79% VILVX Vanguard Instl Trgt Retire 2060 Instl 0.09% 778%

RNWEX

American Funds New 

World R4 0.98% FPADX Fidelity® Emerging Markets Idx 0.08% 1125%

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 43 of 76 PageID #:43
Defendants' Investment Prudent Alternative Investments

Ticker Fund Name

Exp Ratio 

(%) Ticker Fund Name

Exp Ratio 

(%)

Defendants' 

Plan's 

Investment 

Excessive 

Fees (%)

REREX

American Funds 

EuroPacific R4 0.84% DILRX

DFA International 

Large Cap Growth 0.30% 180%

RGAEX

American Funds 

Growth Fund R4 0.68% FSPGX Fidelity® Large Cap Growth Idx 0.03% 2167%

RIDEX

American Funds 

Income

0.61% FFNOX Fidelity® Four-in-One 

Index 0.11% 455%

RNPEX

American Funds New 

Perspective R4

0.80% VTWIX Vanguard Total World 

Stock Index I 0.08% 900%

RWMEX

American Funds 

Washington Mutual R4 0.62% FXAIX Fidelity® 500 Index 0.02% 3000%

CRBYX Columbia Acorn Fund 0.78% VMGMX Vanguard Mid-Cap 

Growth Index Admiral 0.07% 1014%

CYSRX

Columbia Acorn Fund 

USA

1.08% VSGIX Vanguard Small Cap 

Growth Index I 0.06% 1700%

DFFVX DFA DFA US Targeted 

VI Port Ins

0.37% VSIIX Vanguard Small Cap 

Value Index I 0.06% 517%

DODW

X

Dodge & Cox Dodge & 

Cox Glb Stock Fund 0.62% VTWIX Vanguard Total World Stock Index I 0.08% 675%

FNITX Fidelity Advisor New 

Insights Fund T 1.30% FSPGX Fidelity® Large Cap 

Growth Idx 0.03% 4233%

FBGRX Fidelity Blue Chip 

Growth Fund 0.80% FSPGX Fidelity® Large Cap 

Growth Idx 0.03% 2567%

FCNTX Fidelity Contrafund 0.82% FSPGX Fidelity® Large Cap 

Growth Idx 0.03% 2633%

TPINX

Franklin Templeton 

Investments Global 

Bond Fund - Class A

0.94% VSIIX Vanguard Small Cap 

Value Index I 0.06% 1467%

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 44 of 76 PageID #:44
Defendants' Investment Prudent Alternative Investments

Ticker Fund Name

Exp Ratio 

(%) Ticker Fund Name

Exp Ratio 

(%)

Defendants' 

Plan's 

Investment 

Excessive 

Fees (%)

FVFRX

Franklin Templeton 

Investments Small Cap 

Value Fund - Class 2

1.30% VSIIX Vanguard Small Cap 

Value Index I 0.06% 2067%

HNVIX Heartland Value Plus 0.95% FLCOX Fidelity® Large Cap 

Value Index 0.03% 3067%

DDFIX

Invesco Diversified 

Dividend Fund R5 0.52% FLCOX Fidelity® Large Cap 

Value Index 0.03% 1633%

MGRFX

Mass Mutual 

MassMutual Sel Mid 

Cap Growth Fund R5

0.81% VMGMX Vanguard Mid-Cap 

Growth Index Admiral 0.07% 1057%

MFEHX

MFS Massachusetts 

Investors Growth 

Stock Fund -Class R3

0.92% FSPGX Fidelity® Large Cap 

Growth Idx 0.03% 2967%

MITHX

MFS Massachusetts 

Investors Trust - Class 

R3

0.71% FXAIX Fidelity® 500 Index 0.02% 3450%

MEIAX

MFS MFS Value Fund 

Class A 0.83% FLCOX Fidelity® Large Cap 

Value Index 0.03% 2667%

NOSGX

Northern Funds 

Northern Funds Small 

Cap Value Fund

1.00% VSIIX Vanguard Small Cap 

Value Index I 0.06% 1567%

ODMAX

Oppenheimer 

Developing Markets 

Fund - Class A

1.26% FPADX Fidelity® Emerging 

Markets Idx 0.08% 1475%

PRRIX

PIMCO Real Return 

Fund 0.98% VTSPX Vanguard Shrt-Term Infl-Prot Sec Idx Ins 0.04% 2350%

ITHSX

The Hartford Capital 

Appreciation Fund - 

Class R4

1.11% FXAIX Fidelity® 500 Index 0.02% 5450%

HDGSX

The Hartford Dividend 

and Growth Fund - 

Class R4

1.05% FLCOX Fidelity® Large Cap 

Value Index 0.03% 3400%

VGIAX Vanguard Growth and 

Income Fund Adm 0.23% FXAIX Fidelity® 500 Index 0.02% 1050%

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 45 of 76 PageID #:45
189. The underlying data and information reflected in the charts above are truthful, 

accurate, and derived from publically available information, which was equally as available to 

Defendants' Investment Prudent Alternative Investments

Ticker Fund Name

Exp Ratio 

(%) Ticker Fund Name

Exp Ratio 

(%)

Defendants' 

Plan's 

Investment 

Excessive 

Fees (%)

IBRIX

VOYA BlackRock 

Inflation Protected 

Bond Portfolio Inst. 

Class

0.59% VTSPX Vanguard Shrt-Term 

Infl-Prot Sec Idx Ins 0.04% 1375%

VYCCX

VOYA Corporate 

Leaders 100 Fund Class 

I

0.49% FXAIX Fidelity® 500 Index 0.02% 2350%

IEOHX

VOYA Large Cap 

Growth Portfolio - 

Institutional Class

0.67% FSPGX Fidelity® Large Cap 

Growth Idx 0.03% 2133%

IEOSX

VOYA Large Cap 

Growth Portfolio - 

Service Class

0.92% FSPGX Fidelity® Large Cap 

Growth Idx 0.03% 2967%

IIRLX

VOYA Russell Large 

Cap Index Portfolio - 

Class I

0.61% FXAIX Fidelity® 500 Index 0.02% 2950%

IRLCX

VOYA Russell Large 

Cap Index Portfolio - 

Class S

0.61% FXAIX Fidelity® 500 Index 0.02% 2950%

ITCSX

VOYA T. Rowe Price 

Capital Appreciation 

Portfolio - Service 

Class

0.89% VBAIX Vanguard Balanced 

Index I 0.06% 1383%

IAXIX

VOYA T. Rowe Price 

Diversified Mid Cap 

Growth portfolio 

initial class

0.80% VMGMX Vanguard Mid-Cap 

Growth Index Admiral 0.07% 1043%

ESPAX

Wells Fargo 

Advantage Special 

Small Cap Value Fund - 

Class A

1.30% VSIIX Vanguard Small Cap 

Value Index I 0.06% 2067%

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 46 of 76 PageID #:46
Defendants during the Class Period, including but not limited to Plaintiff’s Plan quarterly 

statements, the Plan’s Summary Description, and the Plan’s fee disclosures.

190. In the charts above, the “expense ratio” refers to a percentage of the Plan’s assets 

that were under management during the Class Period. For example, if a mutual fund share class 

deducts 1% of fund assets each year in fees, the fund’s expense ratio would be 1%, or 100 basis 

points (or bps). (One basis point is equal to 1/100th of one percent (or 0.01%)). The fees 

deducted from a mutual fund’s assets reduce the value of the shares owned by fund investors.

191. A prudent fiduciary understands and knows that a fund’s “expense ratio” is one of 

the most – if not the most – important considerations in the fund selection process.

192. During the Class Period, Defendants knew or should have known that a fund’s 

“expense ratio” was one of the most – if not the most – important considerations in the fund 

selection process.

193. During the Class Period and based upon the underlying data and information in 

the charts above, the average Plan expense ratio was 0.82%, or 82 basis points.

194. During the Class Period and based upon the underlying data and information in 

the charts above, the average excessive fee percentage was 1766%.

195. During the Class Period, Defendants did not engage in an objectively reasonable 

process when selecting funds for the Plan.

196. During the Class Period and because Defendants did not engage in an objectively 

reasonable process when selecting funds for the Plan, Defendants actually selected the funds 

identified in the “Defendants’ Investment” column in the charts above.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 47 of 76 PageID #:47
197. During the Class Period and had Defendants engaged in an objectively reasonable 

process when selecting funds for the Plan, Defendants would not have selected the funds 

identified in the “Defendants’ Investment” column in the charts above.

198. During the Class Period and had Defendants been acting in the best interests of 

the Plan’s Participants, Defendants would not have selected the funds identified in the 

“Defendants’ Investment” column in the charts above.

199. During the Class Period and had Defendants been acting in the best interests of 

the Plan’s Participants, Defendants would have selected funds with lower “expense ratios” than 

those funds actually selected by Defendants as identified in the “Defendants’ Investment” 

column in the charts above.

200. During the Class Period and had Defendants been acting in the best interests of 

the Plan’s Participants, Defendants would have selected the funds identified in the “Prudent 

Alternative Investments” column in the charts above.

201. During the Class Period, Plaintiff had no knowledge of Defendants’ process for 

selecting investments and regularly monitoring them to ensure they remained prudent. 

202. During the Class Period, Plaintiff had no knowledge of how the fees charged to 

and paid by the Plan Participants compared to any other funds. 

203. During the Class Period, Plaintiff did not know about the availability of lowercost and better-performing (and other essentially identical) investment options that Defendants 

failed to reasonably offer because Defendants provided no comparative information to allow 

Plaintiff to evaluate and compare Defendants’ investment options. 

204. During the Class Period, Plaintiff did not individually select funds for her 403(b) 

Plan.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 48 of 76 PageID #:48
205. During the Class Period, Defendants failed to reasonably and properly evaluate 

the true cost of the services of each portfolio manager under the fee structure negotiated with 

Voya, thereby paying fees that were more than necessary to the detriment of Plaintiff and the 

Plan’s Participants.

206. During the Class Period and had Defendants chosen investment options similar or 

identical to the funds identified in the “Prudent Alternative Investments” column in the charts 

above, the Plan’s Participants would have been received the exact same portfolio management 

services but at a lower cost. 

207. During the Class Period and because Defendants imprudently chose investment 

options that were not similar or identical to the funds identified in the “Prudent Alternative 

Investments” column in the charts above, Defendants’ caused unreasonable and unnecessary 

losses to Plaintiff and the Plan’s Participants. 

208. During the Class Period, Defendants failed to consider materially similar but 

cheaper alternatives to the Plan’s investment options. The chart above demonstrates that the 

expense ratios of the Plan’s investment options between the years 2014 to 2020 were more 

expensive by significant multiples of comparable passively managed and actively managed

alternative funds in the same investment style. A reasonable investigation would have revealed 

the existence of these lower-cost alternatives.

209. During the Class Period and because Defendants failed to act in the best interests 

of the Plan’s Participants by engaging in an objectively reasonable investigation process when 

selecting its investments, resulting in the selection of funds identified in the “Defendants’ 

Investment” column in the charts above, Plaintiff and the Plan’s Participants incurred actual

expenses and costs as identified in the “Actual Investment Lineup” portion of the chart below.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 49 of 76 PageID #:49
210. During the Class Period and had Defendants acted in the best interests of the 

Plan’s Participants by engaging in an objectively reasonable investigation process when selecting 

its investments, Defendants would have prudently chosen lower-cost investment alternatives as 

identified in the “Alternative Investment Lineup” portion of the chart below.

211. During the Class Period and because Defendants failed to act in the best interests 

of the Plan’s Participants by engaging in an objectively reasonable investigation process when 

selecting its investments, Defendants caused unreasonable and unnecessary losses to Plaintiff 

and the Plan’s Participants in the amount of approximately $19,460,841 and as detailed in the 

following chart:

212. The underlying data and information reflected in the chart above is truthful, 

accurate, and derived from publically available information, which was equally as available to 

Defendants during the Class Period, including but not limited to Plaintiff’s Plan quarterly 

statements, the Plan’s Summary Description, and the Plan’s fee disclosures.

213. During the entirety of the Class Period and by failing to engage in an objectively 

reasonable investigation process when selecting its investments as described herein, Defendants 

breached their fiduciary duties to Plaintiff and the Plan Participants.

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 50 of 76 PageID #:50
EXCESSIVE FEES ASSOCIATED WITH THE PLAN’S STABLE VALUE FUNDS

214. Stable value funds are fairly common in 403(b) plans. Generally, stable value 

products make use of special guaranteed investment contracts known as “GIC,” or “wraps,” that 

have their own risk and return characteristics. 

215. Stable value funds are not offered as mutual funds and typically are structured as: 

(i) an insurance company general account; (ii) an insurance company separate account; or (iii) a 

synthetic GIC-based fund, typically in a Collective Investment Trust (“CIT”). The differences 

between the different types of funds are critical from a fiduciary standpoint. 

216. A stable value account in a direct contribution retirement plan is similar to a 

money market fund in that it provides liquidity and principal protection, and similar to a bond 

fund in that it provides consistent returns over time. It differs from both in that it seeks to 

generate returns greater than a money market and equivalent to a short – intermediate – term 

bond fund. Stable value funds are able to do this because Participant behavior is such that the 

amount of money invested in the account is relatively stable over time. This enables fund 

providers to offer better crediting rates (the rate of return) and to guarantee Participants will not 

lose money by guaranteeing the fund transacts at book value. Stable value accounts also 

“stabilize” the returns through the use of an imbedded formula which is part of the contract with 

the plan that smooths out the volatility of the fund resulting from fluctuations in interest rates 

associated with funds. 

217. There are several different types of stable value accounts in the 403(b) 

marketplace. Large plans overwhelmingly offer “synthetic” stable value funds, which are the 

least risky, because principal is guaranteed by multiple “wrap providers” and the fund owns the 

assets of the underlying funds. The 403(b) market has been slower to accept synthetic-based 

Case: 3:20-cv-50293 Document #: 1 Filed: 08/06/20 Page 51 of 76 PageID #:51
stable value funds due to some regulatory interpretations, but one major provider has this option 

for 403(b) plans like Mercy Health’s. Separate account products, where the assets of the 

underlying funds are held in the separate account of an insurance carrier, are riskier because 

there is only one “wrap” provider. As a result, they offer higher crediting rates. General account 

products, where the funds are held unrestricted in the general account of the insurance carrier, 

are the riskiest type of stable value funds and consequently should offer the highest rates. 

218. During the Class Period, Defendants entered into contracts with Voya related to 

the Voya Financial stable fund and the Voya Fixed Plus Account III,

219. During the Class Period, Defendants entered into contracts with Prudential related 

to Principal stable value option.

220. As of the year 2019, the Voya Fixed Plus Account III held approximately 

$86,412,477.

221. During the Class Period, investment funds were deposited by the insurance 

companies in their general account, which enabled the insurance companies to earn a “spread” 

equal to the difference between the crediting rate and the returns earned by the insurance 

companies from general account funds. 

222. The insurance companies’ GIC is subject to the single entity credit risk of the 

insurance companies, the issuer of the contract. The crediting rate, set in advance by the 

insurance companies and reset from time to time in the insurance companies’ sole discretion, is 

not tied to the performance of a diversified pool of assets in which the investors in the fund have 

an interest. There is also substantial liquidity risk since there is no outside market in these 

contracts. 

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223. A prudent Plan Fiduciary has an obligation to monitor the fees and performance 

of the insurance companies’ GIC and to remove or replace it where a substantially identical 

investment option could be obtained from the same provider at a lower cost.

224. During the Class Period, Defendants had an obligation to monitor the fees and 

performance of the insurance companies’ GIC and to remove or replace it where a substantially 

identical investment option could be obtained from the same provider at a lower cost. 

225. During the Class Period, Defendants had a continuing duty to regularly monitor 

both the performance and fees of the Voya Fixed Plus Account III.

226. During the Class Period, Defendants knew or should have known that they had a 

continuing duty to regularly monitor both the performance and fees of the Voya Fixed Plus 

Account III.

227. During the Class Period, Defendants did not regularly monitor either the 

performance or fees of the Voya Fixed Plus Account III.

228. During the Class Period, Defendants had a continuing duty to regularly remove 

high fee and/or underperforming stable value fund investment options from the Plan.

229. During the Class Period, Defendants knew or should have known that they had a 

continuing duty to regularly remove high fee and/or underperforming stable value fund 

investment options from the Plan.

230. During the Class Period, Defendants unreasonably failed to remove high fee 

and/or underperforming stable value fund investment options from the Plan, which resulted in 

the Plan suffering investment losses.

231. During the Class Period and had Defendants regularly monitored the fees and 

performance of the insurance companies’ GIC and the stable value fund investment options in 

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the Plan, Defendants would have realized there were other, lower-cost, better performing

insurance companies’ GIC and stable value fund investment options than those contained within 

the Plan, including but not limited to the Voya Fixed Plus Account III.

232. During the Class Period and because Defendants did not regularly monitor the 

fees and performance of the insurance companies’ GIC and the stable value fund investment 

options in the Plan, the Plan’s Participants suffered performance losses in the amount of the 

difference between the actual performance of the Voya Fixed Plus Account III and the 

performance of a lower-cost, better performing and prudent alternative.

STANDARD OF CARE FOR PRUDENT FIDUCIARIES IN SELECTING & 

MONITORING OTHER COVERED SERVICE PROVIDERS

233. A prudent Plan Fiduciary is required to fully understand all sources of 

revenue received by covered service providers to ensure that fees earned are reasonable for 

the services provided and in the best interest of Plan Participants. 

234. A prudent Plan Fiduciary solicits bids from other covered service providers 

for comparable services to ensure that the fees being paid by Plan Participants are 

reasonable.

235. A prudent Plan Fiduciary solicits bids from other covered service providers 

for comparable services to ensure that the services provided by the covered service provider 

are of actual a benefit to Plan Participants. 

236. A prudent Plan Fiduciary knows or understands that if a covered service 

provider’s services do not provide a benefit to Plan Participants, then the reasonable fee for 

the services is $0. 

237. A prudent Plan Fiduciary regularly monitors the fees paid to other covered

service providers to ensure that the fees do not become unreasonable over time.

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238. A prudent Plan Fiduciary engaged in an objectively reasonable and thorough 

review process when selecting and retaining an investment consultant.

EXCESSIVE FEES PAID TO INVESTMENT ADVISORS AND CONSULTANTS

239. A prudent Plan Fiduciary must regularly ensure that a plan only pays for services 

that exclusively benefit its Plan Participants.

240. A prudent Plan Fiduciary must regularly ensure that fees a plan pays for services 

are reasonable.

241. During the Class Period, Defendants utilized as its primary investment advisor or

consultant Regal Investment Advisors, which is owned by a brokerage firm Regulus Advisors, 

Inc. During the Class Period, Defendants entered into agreements that resulted in the Plan’s

assets being used to pay several service providers, including Regulus Advisors, LLC, American 

Portfolio Financial Services, and Morningstar.

242. During the Class Period, Defendants paid service providers in excess of 

$4,500,000 for fees and commissions with Plan assets, as identified and detailed in the chart 

below.

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243. The underlying data and information reflected in the chart above are truthful, 

accurate, and derived from publically available information, which was equally as available to 

Defendants during the Class Period.

244. During the Class Period, the services rendered by the providers identified in the 

chart above did not benefit Plan Participants, including Plaintiff.

245. For example, the fees paid to Regulus Advisors resulted in the payment of more 

than 27 basis points on all plan assets from 2015-2018. That fee rate is higher than many of the 

investment options in the Plan and exceeds the estimated fees paid to Voya for RK&A over the 

same period by the Plan.

246. During the Class Period, the Plan’s participant fee disclosure documents and 

participant statements that Defendants provided to Plaintiff and Plan Participants do not provide 

details related to the services provided by Regulus Advisors or the fees charged by Regulus 

Advisors for providing said services. 

247. During the Class Period, the services provided by Regulus Advisors do not 

warrant the fees charged because there are other equally or superior services available to Plan 

Participants, including Plaintiff, for free or at significantly lower rates than those charged by 

Regulus Advisors.

248. Upon information and belief, the Plan Fiduciaries did not solicit competitive bids 

from other service providers similar to Regulus Advisors or evaluate whether other service 

provides could provide the same or superior benefits and services ostensibly provided by 

Regulus Advisors, at a lower cost to Plan Participants.

249. Voya and Regent are parties in interest under 29 U.S.C. § 1002(14) as they 

provide services to the Plan. 

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250. Regent (Regulus) and Voya are dual-registered RIAs as both firms received 

compensation from direct fees from the Plan as well as additional fees and/or commissions from 

money managers and/or insurance providers.

251. RIAs that both charge fees and commissions (dual registration) use higher-fee, 

lower-performing mutual fund families that kick back the most in “revenue sharing.” These 

families, such as American Funds, Oppenheimer, and MFS, are included in the Plan.6

252. Voya has been fined numerous times by the SEC and other regulatory bodies for 

breaches of fiduciary duty in connection with its failure to disclosure fees. 

253. Broker consultants or dual-registered RIAs have an inherent conflict of interest to 

recommend what pays them the most.

254. During the Class Period, Defendants, as fiduciaries to the Plan, knew or should 

have known that Regal and Voya, as dual-registered RIAs, had an inherent conflict of interest 

and/or interests materially adverse to the best interests of Plan Participants.

7

 

255. During the Class Period, Defendants, as fiduciaries to the Plan, caused the Plan to 

engage in transactions in which goods and/or services were furnished, either directly or 

indirectly, between the Plan and parties in interest, including, but not limited to Regal and Voya. 

256. Defendants, as fiduciaries to the Plan, knew or should have known that such 

transactions constituted the direct or indirect furnishing of goods or services between the Plan 

and parties in interest, including, but not limited to Regal and Voya.

257. Defendants, as fiduciaries to the Plan, engaged in prohibited transactions under 29 

U.S.C. § 1106(a)(1)(C).These transactions do not qualify for a statutory exemption under 29 

6 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3360537

7 “Blind reliance on a [broker] whose livelihood [is] derived from commissions he is able to garner is the 

anti-thesis of [a fiduciary’s duty to conduct an] independent investigation.” Liss v. Smith, 991 F.Supp.2d 297, 300 

(S.D.N.Y 1998); Gregg v. Transportation Workers of America Intern., 343 F.3d 833, 841 (6th Cir. 2003).

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U.S.C. § 1108(b)(2) as reasonable compensation for plan service providers, 29 C.F.R. § 

2250.408c-2, as the fees charged were excessive and unreasonable.

CLASS ACTION ALLEGATIONS

258. 29 U.S.C. § 1132(a)(2) authorizes any participant or beneficiary of the Plan to 

bring an action on behalf of the Plan to enforce a breaching fiduciary’s liability to the Plan under 

29 U.S.C. § 1109(a).

259. In acting in this representative capacity, Plaintiff seeks to certify this action as a 

class action on behalf of all participants and beneficiaries of the Plan. Plaintiff seeks to certify, 

and to be appointed as representatives of, the following Class:

All participants and beneficiaries of the Mercy Health 

Corporation 403(b) Employees’ Retirement Plan beginning 

six years before the commencement of this action and 

running through the date of judgment, excluding the 

Defendants or any participant/beneficiary who is a 

fiduciary to the Plan.

260. The members of the proposed Class are readily ascertainable. The number and 

identity of the members of the proposed Class are determinable from the records of Defendants. 

For purposes of notice and other purposes related to this action, putative Class members’ names 

and addresses are readily available from Defendants such that notice can be provided by 

permissible means under Fed. R. Civ. P. 23.

261. Although the precise number of putative Class members is unknown, upon 

information and belief, the proposed Class includes more than 11,000 members and is so 

numerous that joinder of all of its members is impracticable, pursuant to Federal Rule of Civil 

Procedure 23(a)(1), and more importantly the disposition of their claims as a class will benefit 

the parties and the Court.

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262. Plaintiff’s claims are common to those claims which could be alleged by any 

member of the proposed Class, and the relief sought is typical of the relief which would be 

sought by each member of the proposed Class in separate actions. Common questions of law and 

fact which predominate this action include, but are not limited to, all of the following:

• Whether Defendants are fiduciaries liable for the remedies provided by 29 U.S.C. 

§ 1109(a);

• Whether Defendants breached their fiduciary duties to the Plan;

• Whether Defendants engaged in prohibited transactions with the Plan service 

providers;

• The amount of actual monetary losses suffered by the Plan resulting from each 

breach of fiduciary duty; and

• What Plan-wide equitable and other relief the Court should impose in light of 

Defendants’ breach of duty.

263. Plaintiff’s claims are typical of the claims of the Class pursuant to Federal Rule of 

Civil Procedure 23(a)(3), because Plaintiff was a Plan Participant during the Class Period and all 

putative Class members, as Plan Participants, were harmed by Defendants’ misconduct.

264. Plaintiff is able to fairly and adequately protect the interests of the proposed 

Class, pursuant to Federal Rule of Civil Procedure 23(a)(4), because Plaintiff has no interests 

antagonistic to, or that otherwise conflicts with, the interests of the proposed Class, and she is 

committed to the vigorous representation of the Class. Plaintiff has engaged and is represented 

by experienced and competent lawyers who are experienced in both class action litigation and 

complex ERISA claims like those set forth herein.

265. A class action is superior to other available methods for the fair and efficient 

adjudication of the controversy – particularly in the context of wage and hour litigation where 

individual class members lack the financial resources to vigorously prosecute a lawsuit against 

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corporate defendants. Class action treatment will permit a number of similarly-situated persons 

to prosecute common claims in a single forum simultaneously, efficiently, and without the 

unnecessary duplication of efforts and expense that numerous individual actions engender.

266. Certification is further appropriate under Federal Rule of Civil Procedure 

23(b)(1), because prosecution of separate actions for these breaches of fiduciary duties by 

individual participants and beneficiaries would create the risk of: (1) inconsistent or varying 

adjudications that would establish incompatible standards of conduct for Defendant concerning 

its discharge of fiduciary duties to the Plan and personal liability to the Plan under 29 U.S.C. § 

1109(a); and (2) adjudications by individual participants and beneficiaries regarding these 

breaches of fiduciary duties and remedies for the Plan would, as a practical matter, be dispositive 

of the interests of the participants and beneficiaries who are not parties to the adjudication, or 

would substantially impair those participants’ and beneficiaries’ ability to protect their interests.

267. Certification is also appropriate under Federal Rule of Civil Procedure 23(b)(2) 

because Defendants have acted or refused to act on grounds that apply generally to the Class, so 

that final injunctive relief or corresponding declaratory relief is appropriate respecting the class 

as a whole.

268. The claims brought by the Plaintiff arise from fiduciary breaches as to the Plan in 

its entirety and do not involve mismanagement of individual accounts. The claims asserted on 

behalf of the Plan fall outside the scope of any exhaustion language in individual participants’ 

plans. Exhaustion is intended to serve as an administrative procedure for participants and 

beneficiaries whose claims have been denied and not where a participant or beneficiary brings 

suit on behalf of a plan for breaches of fiduciary duty.

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269. Under ERISA, an individual “participant” or “beneficiary” are distinct from an 

ERISA plan. A participant’s obligation – such as a requirement to exhaust administrative 

remedies – does not, by itself, bind the plan.

270. Moreover, any administrative appeal would be futile because the entity hearing 

the appeal (the Plan Administrator) is the same Plan Administrator that made the decisions that 

are at issue in this lawsuit. Policy supporting exhaustion of administrative remedies in certain 

circumstances – that the Court should review and where appropriate defer to a plan 

administrator’s decision – doesn’t exist here because courts will not defer to a plan 

administrator’s legal analysis and interpretation.

FIRST CLAIM FOR RELIEF

Breaches of Duties of Loyalty and Prudence of ERISA, as Amended

(Plaintiff, on behalf of herself and Class – RK&A Fees)

204. Plaintiff restates the above allegations as if fully set forth herein.

205. Defendants are fiduciaries of the Plan under 29 U.S.C. §§ 1002(21) and/or 

1102(a)(1).

206. 29 U.S.C. § 1104 imposes fiduciary duties of prudence and loyalty upon 

Defendants in their administration of the Plan. 

207. Defendants, as fiduciaries of the Plan, are responsible for selecting a recordkeeper 

that charges reasonable RK&A fees.

208. During the Class Period, Defendants had a fiduciary duty to do all of the 

following: ensure that the Plan’s RK&A fees were reasonable; manage the assets of the Plan for 

the sole and exclusive benefit of Plan Participants and beneficiaries; defray reasonable expenses 

of administering the Plan; and act with the care, skill, diligence, and prudence required by 

ERISA. 

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209. During the Class Period, Defendants breached their fiduciary duties of prudence 

and loyalty to Plan Participants, including Plaintiff, by failing to ensure that the Plan’s RK&A 

fees were reasonable, manage the assets of the Plan for the sole and exclusive benefit of Plan 

Participants and beneficiaries, defray reasonable expenses of administering the Plan, act with the 

care, skill, diligence, and prudence required by ERISA.

210. During the Class Period, Defendants further had a continuing duty to regularly 

monitor and evaluate the Plan’s recordkeeper to make sure it was providing the contracted 

services at reasonable costs, given the highly competitive market surrounding recordkeeping 

services and the significant bargaining power the Plan had to negotiate the best fees. 

211. During the Class Period, Defendants breached their duty to Plan Participants, 

including Plaintiff, by failing to employ a prudent and loyal process by failing to critically or 

objectively evaluate the cost and performance of the Plan’s recordkeeper in comparison to other 

recordkeeping options. 

212. Through these actions and omissions, Defendants breached their fiduciary duties 

of prudence and loyalty with respect to the Plan in violation 29 U.S.C. § 1104(a)(1)(A). 

213. Defendants’ failure to discharge their duties with respect to the Plan with the care, 

skill, prudence, and diligence under the circumstances then prevailing that a prudent person 

acting in a like capacity and familiar with such matters would have used in the conduct of an 

enterprise of like character and with like aims, breaching its duties under 29 U.S.C. § 

1104(a)(1)(B). 

214. As a result of Defendants’ breach of fiduciary duty of prudence and loyalty with 

respect to the Plan, as aforesaid, the Plaintiff and Plan Participants suffered unreasonable and 

unnecessary monetary losses. 

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215. Defendants are liable under 29 U.S.C. §§ 1109(a) and 1132(a)(2) to make good to 

the Plan the losses resulting from the breaches, to restore to the Plan any profits defendants made 

through the use of Plan assets, and to restore to the Plan any profits resulting from the breaches 

of fiduciary duties alleged in this Count. In addition, Defendants are subject to other equitable 

relief pursuant to 29 U.S.C. §§ 1109(a) and 1132(a)(2). 

SECOND CLAIM FOR RELIEF

Breaches of Duties of Loyalty and Prudence of ERISA, as Amended

(Plaintiff, on behalf of herself and Class – Investment Management Fees)

216. Plaintiff restates the above allegations as if fully set forth herein.

217. Defendants are fiduciaries of the Plan under 29 U.S.C. §§ 1002(21) and/or 

1102(a)(1). 

218. 29 U.S.C. § 1104 imposes fiduciary duties of prudence and loyalty upon 

Defendants in managing the investments of the Plan.

219. Defendants, as fiduciaries of the Plan, are responsible for selecting prudent 

investment options, ensuring that those options charge only reasonable fees, and taking any other 

necessary steps to ensure that the Plan’s assets are invested prudently. 

220. During the Class Period, Defendants had a fiduciary duty to do all of the 

following: manage the assets of the Plan for the sole and exclusive benefit of Plan Participants

and beneficiaries; defray reasonable expenses of administering the Plan; and act with the care, 

skill, diligence, and prudence required by ERISA. 

221. During the Class Period, Defendants breached their fiduciary duties of prudence 

and loyalty to Plan Participants, including Plaintiff, by failing to manage the assets of the Plan 

for the sole and exclusive benefit of Plan Participants and beneficiaries, defray reasonable 

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expenses of administering the Plan, act with the care, skill, diligence, and prudence required by 

ERISA.

222. Defendants, as fiduciaries of the Plan, had a continuing duty to regularly monitor 

and independently assess whether the Plan’s investments were prudent choices for the Plan and 

to remove imprudent investment options regardless of how long said investments had been in the 

Plan. 

223. During the Class Period, Defendants breached their fiduciary duties of prudence 

and loyalty to Plan Participants, including Plaintiff, by failing to engage in a prudent process for 

monitoring the Plan’s investments and removing imprudent ones within a reasonable period. 

224. Defendants were directly responsible for ensuring that the Plan’s investment

management fees were reasonable, selecting investment options in a prudent fashion in the best 

interest of Plan Participants, prudently evaluating and monitoring the Plan’s investments on an 

ongoing basis and eliminating funds or share classes that did not serve the best interest of Plan 

Participants, and taking all necessary steps to ensure that the Plan’s assets were invested 

prudently and appropriately.

225. Defendants failed to employ a prudent and loyal process by failing to critically or 

objectively evaluate the cost and performance of the Plan’s investments and fees in comparison 

to other investment options. Defendants selected and retained for years as Plan investment 

options mutual funds with high expenses relative to other investment options that were readily 

available to the Plan at all relevant times. 

226. Through these actions and omissions, Defendants breached their fiduciary duties 

of prudence and loyalty with respect to the Plan in violation 29 U.S.C. § 1104(a)(1)(A). 

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227. Defendants failure to discharge their duties with respect to the Plan with the care, 

skill, prudence, and diligence under the circumstances then prevailing that a prudent person 

acting in a like capacity and familiar with such matters would have used in the conduct of an 

enterprise of like character and with like aims, breaching its duties under 29 U.S.C. § 

1104(a)(1)(B).

228. As a result of Defendants’ breach of their fiduciary duties of prudence and loyalty 

with respect to the Plan, as aforesaid, the Plaintiff and Plan Participants suffered unreasonable 

and unnecessary monetary losses. 

229. Defendants are liable under 29 U.S.C. §§ 1109(a) and 1132(a)(2) to make good to 

the Plan the losses resulting from the breaches, to restore to the Plan any profits defendants made 

through the use of Plan assets, and to restore to the Plan any profits resulting from the breaches 

of fiduciary duties alleged in this Count. In addition, Defendants are subject to other equitable 

relief pursuant to 29 U.S.C. §§ 1109(a) and 1132(a)(2).

THIRD CLAIM FOR RELIEF

Breaches of Duties of Loyalty and Prudence of ERISA, as Amended

(Plaintiff, on behalf of herself and Class – Service Provider Fees)

204. Plaintiff restates the above allegations as if fully set forth herein.

205. Defendants are fiduciaries of the Plan under 29 U.S.C. §§ 1002(21) and/or 

1102(a)(1). 

206. 29 U.S.C. § 1104 imposes fiduciary duties of prudence and loyalty upon 

Defendants in managing the investments of the Plan. 

207. During the Class Period, Defendants had a fiduciary duty to do all of the 

following: manage the assets of the Plan for the sole and exclusive benefit of Plan Participants

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and beneficiaries; defray reasonable expenses of administering the Plan; and act with the care, 

skill, diligence, and prudence required by ERISA. 

208. During the Class Period, Defendants breached their fiduciary duties of prudence 

and loyalty to Plan Participants, including Plaintiff, by failing to manage the assets of the Plan 

for the sole and exclusive benefit of Plan Participants and beneficiaries, defray reasonable 

expenses of administering the Plan, act with the care, skill, diligence, and prudence required by 

ERISA.

209. Defendants, as fiduciaries of the Plan, had a continuing duty to regularly monitor 

and independently assess the fees of service providers, including but not limited, to Regulus and 

Voya, its primary investment advisors and consultants, and whether said fees were a prudent 

choice for the Plan.

271. During the Class Period, Defendants breached their fiduciary duties of prudence 

and loyalty to Plan Participants, including Plaintiff, by failing to monitor the fees of these service 

providers.

210. Defendants failed to employ a prudent and loyal process by failing to critically or 

objectively evaluate the cost and performance of the Plan’s service providers in comparison with

other service provider options. Defendants selected and retained for years Regulus and Voya as 

investment consultants and advisors with high fees relative to other service provider options that 

were readily available to the Plan during the Class Period. 

211. Defendants failed to engage in a prudent process for monitoring the Plan’s service 

providers and removing imprudent ones within a reasonable period. This resulted in the Plan 

continuing to offer unreasonably expensive services compared to equivalent and/or comparable 

low-cost alternatives that were available to the Plan. 

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212. Through these actions and omissions, Defendants breached their fiduciary duties 

of prudence and loyalty with respect to the Plan in violation 29 U.S.C. § 1104(a)(1)(A). 

213. Defendants failure to discharge their duties with respect to selecting service 

providers for the Plan with the care, skill, prudence, and diligence under the circumstances then 

prevailing that a prudent person acting in a like capacity and familiar with such matters would 

have used in the conduct of an enterprise of like character and with like aims, breaching its duties 

under 29 U.S.C. § 1104(a)(1)(B).

214. As a result of Defendants’ breach of fiduciary duty of prudence and loyalty with 

respect to the Plan, as aforesaid, the Plaintiff and Plan Participants suffered unreasonable and 

unnecessary monetary losses. 

215. Defendants are liable under 29 U.S.C. §§ 1109(a) and 1132(a)(2) to make good to 

the Plan the losses resulting from these breaches, to restore to the Plan any profits defendants 

made through the use of Plan assets, and to restore to the Plan any profits resulting from the 

breaches of fiduciary duties alleged in this Count. In addition, Defendants are subject to other 

equitable relief pursuant to 29 U.S.C. §§ 1109(a) and 1132(a)(2).

FOURTH CLAIM FOR RELIEF

Failure to Adequately Monitor Other Fiduciaries under ERISA, as Amended

(Plaintiff, on behalf of herself and Class – RK&A Fees)

216. Plaintiff restates the above allegations as if fully set forth herein.

217. Defendants had the authority to appoint and remove members or individuals 

responsible for Plan RK&A fees and knew or should have known that these fiduciaries had 

critical responsibilities for the Plan.

218. In light of this authority, Defendants had a duty to monitor those individuals 

responsible for Plan RK&A fees to ensure that they were adequately performing their fiduciary 

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obligations, and to take prompt and effective action to protect the Plan in the event that these 

individuals were not fulfilling those duties.

219. Defendants had a duty to ensure that the individuals responsible for Plan 

administration possessed the needed qualifications and experience to carry out their duties (or 

use qualified advisors and service providers to fulfill their duties); had adequate financial 

resources and information; maintained adequate records of the information on which they based 

their decisions and analysis with respect to the Plan’s investments; and reported regularly to 

Defendants.

220. Defendants breached their fiduciary duties by, among other things:

a. Failing to monitor and evaluate the performance of individuals responsible 

for Plan RK&A fees or have a system in place for doing so, standing idly by as 

the Plan suffered significant losses in the form of unreasonably high RK&A

expenses;

b. Failing to monitor the process by which Plan recordkeepers were 

evaluated and failing to investigate the availability of lower-cost recordkeepers; 

and

c. Failing to remove individuals responsible for Plan RK&A fees whose 

performance was inadequate in that these individuals continued to pay the same 

RK&A costs even though benchmarking and using other similar comparators 

would have showed that maintaining Voya as record keeper was imprudent, 

excessively costly, all to the detriment of the Plan and Plan Participants’ 

retirement savings.

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221. As the consequences of the foregoing breaches of the duty to monitor for RK&A 

fees the Plaintiff and Plan Participants suffered unreasonable and unnecessary monetary losses.

222. Pursuant to 29 U.S.C. §§ 1109(a) and 1132(a)(2), Defendants are liable to restore 

to the Plan all loses caused by their failure to adequately monitor individuals responsible for 

Plan RK&A fees. In addition, Plaintiffs are entitled to equitable relief and other appropriate relief 

as set forth in the Prayer for Relief.

FIFTH CLAIM FOR RELIEF

Failure to Adequately Monitor Other Fiduciaries under ERISA, as Amended

(Plaintiff, on behalf of herself and Class – Investment Management Fees)

223. Plaintiff restates the above allegations as if fully set forth herein.

224. Defendants had the authority to appoint and remove members or individuals

responsible for Plan investment management and were aware that these fiduciaries had critical 

responsibilities for the Plan.

225. In light of this authority, Defendants had a duty to monitor those individuals 

responsible for Plan investment management to ensure that they were adequately performing 

their fiduciary obligations, and to take prompt and effective action to protect the Plan in the 

event that these individuals were not fulfilling those duties.

226. Defendants had a duty to ensure that the individuals responsible for Plan 

investment management possessed the needed qualifications and experience to carry out their 

duties (or use qualified advisors and service providers to fulfill their duties); had adequate 

financial resources and information; maintained adequate records of the information on which 

they based their decisions and analysis with respect to the Plan’s investments; and reported 

regularly to Defendants.

227. Defendants breached their fiduciary duties by, among other things:

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a. Failing to monitor and evaluate the performance of individuals responsible 

for Plan investment management or have a system in place for doing so, standing 

idly by as the Plan suffered significant losses in the form of unreasonably high 

expenses, choices of fund’s class of shares, and inefficient fund management 

styles that adversely affected the investment performance of the funds’ and their 

Participants’ assets as a result of these individuals responsible for Plan imprudent 

actions and omissions;

b. Failing to monitor the process by which Plan investments were evaluated, 

failing to investigate the availability of lower-cost share classes, and failing to 

investigate the availability of lower-cost collective trust vehicles; and

c. Failing to remove individuals responsible for Plan administration whose 

performance was inadequate in that they continued to maintain imprudent, 

excessively costly, and poorly performing investments within the Plan, all to the 

detriment of the Plan and Plan Participants’ retirement savings.

228. As a result of Defendants’ foregoing breaches of the duty to monitor, the Plaintiff 

and Plan Participants suffered unreasonable and unnecessary monetary losses.

229. Pursuant to 29 U.S.C. §§ 1109(a) and 1132(a)(2), Mercy Health is liable to restore 

to the Plan all loses caused by their failure to adequately monitor individuals responsible for 

Plan administration. In addition, Plaintiffs are entitled to equitable relief and other appropriate 

relief as set forth in the Prayer for Relief.

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SIXTH CLAIM FOR RELIEF

Failure to Adequately Monitor Other Fiduciaries under ERISA, as Amended

(Plaintiff, on behalf of herself and Class – Service Provider Fees)

230. Plaintiff restates the above allegations as if fully set forth herein.

231. Defendants had the authority to appoint and remove members or individuals 

responsible for Plan service providers and knew or should have known that these fiduciaries had 

critical responsibilities for the Plan.

232. In light of this authority, Defendants had a duty to monitor those individuals 

responsible for Plan service providers to ensure that they were adequately performing their 

fiduciary obligations, and to take prompt and effective action to protect the Plan in the event that 

these individuals were not fulfilling those duties.

233. Defendants had a duty to ensure that the individuals responsible for Plan service 

providers possessed the needed qualifications and experience to carry out their duties (or use 

qualified advisors and service providers to fulfill their duties); had adequate financial resources 

and information; maintained adequate records of the information on which they based their 

decisions and analysis with respect to the Plan’s investments; and reported regularly to 

Defendants.

234. Defendants breached their fiduciary duties by, among other things:

a. Failing to monitor and evaluate the performance of individuals responsible 

for Plan service providers or have a system in place for doing so, standing idly by 

as the Plan suffered significant losses in the form of unreasonably high expenses 

and inefficient fund management styles that adversely affected the investment 

performance of the funds’ and their Participants’ assets as a result of these 

individuals responsible for Plan imprudent actions and omissions;

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b. Failing to monitor the process by which Plan service providers were 

evaluated; and

c. Failing to remove individuals responsible for Plan service providers whose 

performance was inadequate in that they continued to maintain imprudent, 

excessively costly, and poorly performing service providers within the Plan, all to 

the detriment of the Plan and Plan Participants’ retirement savings.

235. As a result of Defendants’ foregoing breaches of the duty to monitor, the Plaintiff 

and Plan Participants suffered unreasonable and unnecessary monetary losses. Pursuant to 29 

U.S.C. §§ 1109(a) and 1132(a)(2), Mercy Health is liable to restore to the Plan all loses caused 

by their failure to adequately monitor individuals responsible for Plan administration. In 

addition, Plaintiffs are entitled to equitable relief and other appropriate relief as set forth in the 

Prayer for Relief.

SEVENTH CLAIM FOR RELIEF

Engaging in Party in Interest Prohibited Transactions under ERISA, as Amended

(Plaintiff, on behalf of herself and Class – RK&A Fees)

236. Plaintiff restates the above allegations as if fully set forth herein.

237. Recordkeeper Voya is a party in interest under 29 U.S.C. § 1002(14) as it

provides recordkeeping services to the Plan. 

238. Defendants, as fiduciaries to the Plan, thus also engaged in prohibited transactions 

under 29 U.S.C. § 1106(a)(1)(C), as it caused the Plan knowingly to engage in transactions

constituting a direct and indirect furnishing of goods or services between the Plan and parties in 

interest using assets of the Plan to pay for the unreasonable Voya RK&A fees. 

239. These transactions do not qualify for a statutory exemption under 29 U.S.C. § 

1108(b)(2), as reasonable compensation for RK&A fees under 29 C.F.R. § 2250.408c-2, because 

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the fees charged by Voya were high and unreasonable because of the conflicts of interest that 

Voya had.

240. As a result of the foregoing prohibited transactions, the Plaintiff and Plan 

Participants suffered unreasonable and unnecessary monetary losses.

241. Pursuant to 29 U.S.C. §§ 1109(a) and 1132(a)(2), Defendants are liable to restore 

to the Plan all loses caused by this party in interest prohibited transaction. In addition, Plaintiff 

and the Class are entitled to equitable relief and other appropriate relief as set forth in the Prayer 

for Relief.

EIGTH CLAIM FOR RELIEF

Engaging in Party in Interest Prohibited Transactions under ERISA, as Amended

(Plaintiff, on behalf of herself and Class – Investment Management Fees)

242. Plaintiff restates the above allegations as if fully set forth herein.

243. Recordkeeper Voya is a party in interest under 29 U.S.C. § 1002(14) as it

provides investment management services to the Plan. 

244. Defendants, as fiduciaries to the Plan, engaged in prohibited transactions under 29 

U.S.C. § 1106(a)(1)(C), as it caused the Plan knowingly to engage in transactions constituting a 

direct and indirect furnishing of goods or services between the Plan and parties in interest using 

assets of the Plan to pay for the unreasonable Voya investment management fees. 

245. These transactions do not qualify for a statutory exemption under 29 U.S.C. § 

1108(b)(2), as reasonable compensation for investment management fees under 29 C.F.R. § 

2250.408c-2, because the fees charged by Voya were high and unreasonable because of the 

conflicts of interest that Voya had.

246. As a result of the foregoing prohibited transactions, the Plaintiff and Plan 

Participants suffered unreasonable and unnecessary monetary losses.

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247. Pursuant to 29 U.S.C. §§ 1109(a) and 1132(a)(2), Defendants are liable to restore 

to the Plan all loses caused by this party in interest prohibited transaction. In addition, Plaintiff 

and the Class are entitled to equitable relief and other appropriate relief as set forth in the Prayer 

for Relief.

NINTH CLAIM FOR RELIEF

Engaging in Party in Interest Prohibited Transactions under ERISA, as Amended

(Plaintiff, on behalf of herself and Class – Service Provider Fees)

248. Plaintiff restates the above allegations as if fully set forth herein.

249. Recordkeeper Voya and Regulus are parties in interest under 29 U.S.C. § 

1002(14) as they provide investment advisor and consulting services to the Plan. 

250. Defendants, as fiduciaries to the Plan, thus also engaged in prohibited transactions 

under 29 U.S.C. § 1106(a)(1)(C), as it caused the Plan knowingly to engage in transactions 

constituting a direct and indirect furnishing of goods or services between the Plan and parties in 

interest using assets of the Plan to pay for the unreasonable Voya and Regulus investment 

advisor and consulting fees. 

251. These transactions do not qualify for a statutory exemption under 29 U.S.C. § 

1108(b)(2), as reasonable compensation for investment advisor and consulting fees under 29 

C.F.R. § 2250.408c-2, because the fees charged by Voya and Regulus were high and 

unreasonable.

252. As a result of the foregoing prohibited transactions, the Plaintiff and Plan 

Participants suffered unreasonable and unnecessary monetary losses

253. Pursuant to 29 U.S.C. §§ 1109(a) and 1132(a)(2), Defendants are liable to restore 

to the Plan all loses caused by this party in interest prohibited transaction. In addition, Plaintiff 

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and the Class are entitled to equitable relief and other appropriate relief as set forth in the Prayer 

for Relief.

WHEREFORE, Plaintiff prays that judgment be entered against Defendants on all 

claims and requests that the Court award the following relief:

A. A determination that this action may proceed as a class action under Rule 

23(b)(1), or in the alternative Rule 23(b)(2), of the Federal Rules of Civil 

Procedure;

B. Designation of Plaintiff as Class Representative and designation of Plaintiff’s 

counsel as Class Counsel;

C. A Declaration the Defendants have breached their fiduciary duties under ERISA; 

D. An Order compelling the Defendants to make good to the Plan all losses to the 

Plan resulting from Defendants’ breaches of fiduciary duty, including restoring to 

the Plan all losses resulting from imprudent investment of the Plan’s assets, 

restoring to the Plan all profits the Defendants made through use of the Plan’s 

assets, and restoring to the Plan all profits which the Participants would have 

made if the Defendants had fulfilled their fiduciary obligation; 

E. An Order requiring the Defendant Mercy Health to disgorge all profits received 

from, or in respect of, the Plan, and/or equitable relief pursuant to 29 U.S.C. § 

1132(a)(3) in the form of an accounting for profits, imposition of a constructive 

trust, or a surcharge against Mercy Health as necessary to effectuate said relief, 

and to prevent Mercy Health’s unjust enrichment; 

F. An Order enjoining Defendants from any further violation of their ERISA 

fiduciary responsibilities, obligations, and duties; 

G. Other equitable relief to redress Defendants’ illegal practices and to enforce the 

provisions of ERISA as may be appropriate, including appointment of an 

independent fiduciary or fiduciaries to run the Plan and removal of Plan 

Fiduciaries deemed to have breached their fiduciary duties;

H. An award of pre-judgment interest;

I. An award of attorneys’ fees and costs pursuant to 29 U.S.C. § 1132(g) and the 

common fund doctrine; and

J. Such other and further relief as the Court deems equitable and just.

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Dated this 6th day of August, 2020

WALCHESKE & LUZI, LLC

Counsel for Plaintiff

s/ James A. Walcheske . 

James A. Walcheske, WI State Bar No. 1065635

Scott S. Luzi, WI State Bar No. 1067405

Pro Hac Vice Motion to be Filed

Paul M. Secunda, WI State Bar No. 1074127

Pro Hac Vice Motion to be Filed

WALCHESKE & LUZI, LLC

15850 W. Bluemound Rd., Suite 304

Brookfield, Wisconsin 53005

Telephone: (262) 780-1953

Fax: (262) 565-6469

E-Mail: jwalcheske@walcheskeluzi.com

E-Mail: sluzi@walcheskeluzi.com

E-Mail: psecunda@walcheskeluzi.com

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