View From McDermott: Is Tibble the End of Revenue Sharing?

By and on March 30, 2016

Ten short years ago, revenue sharing seemingly presented a “win win” opportunity for third-party administrators (TPAs) and defined contribution plan sponsors. TPAs generally retained all revenue sharing payments received from plans’ investment fund companies in exchange for administrative services provided to the investment funds. In recognition of the revenue sharing received from the investment fund companies, TPAs often provided “free” plan administrative services to plan sponsors. Starting in the mid-2000s, however, more plan sponsors began to question the amount of money received by the TPAs under this arrangement, and plaintiffs’ lawyers and the DOL began to monitor and scrutinize revenue sharing.

This article summarizes the evolution of revenue sharing over the past ten years and examines its future through the lens of the recent U.S. Supreme Court decision in Tibble v. Edison and the subsequent uptick in 401(k) fee litigation.

Read the full article.

Lisa Loesel
Lisa Loesel focuses her practice on employee benefits matters, including the design, amendment and administration of pension and 401(k) plans, nonqualified deferred compensation arrangements, and employee stock ownership plans. She counsels privately and publicly held corporations regarding the employee benefits design and transition matters arising from corporate mergers, acquisitions and divestitures. She also advises clients regarding fiduciary and plan investment issues under the Employee Retirement Income Security Act of 1974 (ERISA). Lisa also has experience counseling plan fiduciaries with respect to the claims and appeals procedures under ERISA. Read Lisa Loesel's full bio.

Mary K. Samsa




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