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Mealeys

Mealey's Labor & Employment - U.S. Supreme Court Hears Arguments On ESOP Funds And Using Inside Knowledge

WASHINGTON, D.C. - Arguments by participants in an employee stock option plan (ESOP) who have accused plan fiduciaries of violating the Employee Retirement Income Security Act's duty of prudence by continuing to invest funds despite insider knowledge that the stock price was artificially inflated fail as "ESOP fiduciaries do not have a fiduciary obligation to use information gained in the corporate capacity or to use the regular corporate channels of disclosure for the benefit of plan participants," Paul D. Clement of Kirkland & Ellis in Washington told the U.S. Supreme Court on Nov. 6, arguing on behalf of the fiduciaries (Retirement Plans Committee of IBM, et al. v. Larry W. Jander, et al., No. 18-1165, U.S. Sup.).
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