Boley v. Universal Health Servs.

Boley v. Universal Health Servs.

Opinion

 [*629]  MEMORANDUM

KEARNEY, J.

Three participants in their former employer's defined contribution plan are suing the plan's fiduciaries for allegedly breaching fiduciary duties owed to them under ERISA. The three plan participants [**2]  move to certify and represent a class of over 60,000 active participants. The plan participants invested in different funds but focus their allegations on the fiduciaries allegedly retaining more expensive and underperforming funds despite the availability of lower cost funds, failing to monitor excessive record keeping and administrative fees and costs relative to similar plans, offering an excessively expensive menu of investment options, and failing to monitor their appointees. We denied the fiduciaries' partial motion to dismiss four months ago.

The fiduciaries now oppose class certification arguing individualized defenses under ERISA section 404(c), potentially differing limitations periods, and the three participants' investments in different funds render the participants atypical and the defenses create issues unable to be resolved on a class-wide basis. Following discovery, we find the three participants may proceed in representing a class of current and former plan participants. We agree with the persuasive reasoning from courts around the country rejecting the fiduciaries' arguments at this stage. We grant the three participants' motion for class certification.

I. Background

Universal Health Services, [**3]  Inc. sponsors the Universal Health Services, Inc. Retirement Savings Plan ("Plan"), a defined contribution plan under which its qualified employees can invest a portion of their paycheck in one or more of thirty available investment options. Universal Health Services matches a portion of those contributions.¹ Universal Health Services and its Investment Committee appointed by the Board of Directors serve as the Plan's fiduciaries and administrators.² The fiduciaries must administer the Plan under Congress' mandates in the Employee Retirement Income Security Act of 1974 ("ERISA").³

The Plan had 60,018 active participants in 2018 with 41,872 holding active account balances.⁴ The Plan had net assets totaling over $1.9 billion.⁵ From June 5, 2014 through at least last month, the Plan offered participants a menu of thirty-seven investment options including some offered for a limited time.⁶

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