Sunday, March 7, 2021
The U.S. Court of Appeals for the Second Circuit recently concluded that investment advisor Ruane Cunniff & Goldfarb must face a proposed class action under ERISA Section 502(a)(2) for breach of fiduciary duty relating to its alleged mismanagement of a profit-sharing plan sponsored by DST Systems, Inc.
Cooper v. Ruane Cunniff & Goldfarb Inc., No. 17-2805 (2d Cir. March 4, 2021). The suit challenges Ruane’s allegedly “catastrophic over-allocation” of plan assets to shares in Valeant Pharmaceuticals, which dramatically declined in value in 2015-2016.
In 2016, Clive Cooper, who had been employed by DST and participated in DST’s profit-sharing plan, filed the lawsuit naming Ruane, DST, and others as Defendants. Then Cooper successfully mediated his claims with DST and others, voluntarily dismissing his claims against all Defendants except Ruane.