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A federal judge ruled in favor of New York University Tuesday in a lawsuit brought by employees who alleged they had been stuck with poor-performing investments and hit with excessive fees in their university-sponsored retirement plans.
U.S. District Judge Katherine Forrest said the plaintiffs did not prove the university’s retirement plan committee had caused losses or acted imprudently, Reuters reported. Although the “level of involvement and seriousness with which several committee members treated their fiduciary duty” may have been troubling, it was not a failure to fulfill fiduciary obligations, she wrote.
A group of plaintiffs including six professors and an instructor had argued NYU’s decisions caused more than $358 million in losses across two 403(b) plans, which are defined-contribution retirement plans that are similar to a 401(k) but available for nonprofit institutions like colleges and universities. The lawsuit was one of several brought by Jerome Schlichter, a lawyer specializing in retirement plan suits.
Schlichter told Reuters in a statement that he would continue to pursue the case “in order to make the NYU employees and retirees financially whole.”
NYU is pleased by the outcome, a spokesman, John Beckman, said in a statement.
“NYU maintained from the time the plaintiffs first publicized this case that it was baseless, and the judge's finding supports that,” he said. “The simple fact is that NYU is and always has been a careful, conscientious steward of the retirement plans for its employees and retirees, and the plaintiffs failed to meet their burden of proof to suggest otherwise.”
