Rising Tide of 401(k) Forfeiture Suits Reaches Appellate Level

Litigation attorney Monica Perkowski was quoted in a Bloomberg Law article examining the growing wave of lawsuits challenging how employers use forfeited 401(k) contributions under the Employee Retirement Income Security Act of 1974 (ERISA). With nearly 100 cases filed nationwide and the first appellate arguments now underway, the article highlighted the increasing scrutiny facing plan sponsors and fiduciaries as these claims move beyond the district court level. It also explored how appellate judges are grappling with novel legal theories, divergent interpretations of plan language and conflicting rulings that could significantly shape the future of fiduciary litigation. Ms. Perkowski, who has co-authored multiple Holland & Knight alerts on this trend, underscored the significance of these early appellate decisions and commented on issues the courts could address in their opinions, such as the distinction between settlor and fiduciary functions.

"Because this is such a novel issue and this might be the first appeals court to weigh in, this is significant and would be something other courts would look to," she said.

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