The US Court of Appeals for the First Circuit has solidified a circuit split on who has burden of proving loss causation in ERISA breach of fiduciary duty cases. The First Circuit joined the Fourth, Fifth and Eighth Circuits holding that once a plaintiff demonstrates a fiduciary breach, the defendant has the burden to negate loss causation. Other circuits, including the Sixth, Ninth, Tenth and Eleventh Circuits, have held that a plaintiff bears to burden to establish loss causation. This issue is ripe for Supreme Court review.
Eliot (Eli) T. Burriss is a partner in the Firm’s Litigation Practice Group. For nearly 15 years, Eli has litigated complex commercial disputes throughout the United States, serving as counsel to global clients in all aspects of litigation. In recent years, he has had a particular emphasis on representing health care and life sciences companies, as well as a variety of organizations in antitrust, ERISA and other significant matters. Read Eliot T. Burriss' full bio.
Recent litigation and audit activity is focusing on the process undertaken by fiduciaries in connection with a transaction involving an ESOP. Eliot Burriss presented at the 2018 National Center for Employee Ownership Conference summarizing relevant litigation cases, exploring roles and responsibilities, and providing best practices.
The US Department of Labor has taken the position that certain indemnification clauses are void against public policy under Section 410 of ERISA. This policy has been adopted by private plaintiff classes; as evident from a recent settlement, a policy that voids indemnity provisions can limit defense budgets, make settlements more likely and potentially create dangerous precedent for ESOPs.
Through a series of recent settlements, the US Department of Labor has outlined the process steps fiduciaries should follow in connection with a transaction involving a purchase from, or sale to, an employee stock ownership plan.