Supreme Court weighs how 401(k) savers can sue over weak funds
The Supreme Court heard a case Tuesday from Intel workers who say their 401(k) plan was badly managed. The justices seemed ready to require workers to compare their fund to a similar one. They were unsure how much to spell out what counts as similar.
Millions of workers save for retirement in 401(k) plans. On Tuesday, the Supreme Court heard a case about when those workers can sue if their plan's investments do poorly.
The case is Anderson v. Intel. Intel workers say the chip maker's retirement plan committee moved into "costly and illiquid" investments, such as hedge funds and private equity, after the 2008 financial crisis, Bloomberg Law reported. A federal appeals court threw out their suit. It said the workers had not compared those investments to better-performing funds with similar goals.
That test is called a "meaningful benchmark." Several appeals courts use it, and it has helped employers win dismissal of cases early. The workers say the rule protects plans that pursue reckless strategies. Intel's committee, backed by the U.S. solicitor general, says nearly every fund underperforms some other fund over some period.
None of the justices' questions suggested they would drop the need for comparisons, Bloomberg Law reported. The harder question was how much guidance to give lower courts.
Justice Amy Coney Barrett asked whether requiring "like aims and strategies" would make lower courts "look for a twin." Justice Elena Kagan suggested the court could say a benchmark must be "meaningfully similar," but "that doesn't mean identical."
Justices Neil Gorsuch and Brett Kavanaugh said the workers' lawyer seemed to be shifting away from the question the court agreed to decide.
"The court seems ready to say apples-to-apples, yes; identical apples, no," said Paul Secunda, a lawyer who listened to the argument.
Matthew Wessler argued for the workers, Charles McCloud for Intel's committee and Aimee Brown for the United States, SCOTUSblog's case page shows.
Some background: These lawsuits are filed under the Employee Retirement Income Security Act, or ERISA. Such class actions are up markedly in 2026, Bloomberg Law said.
How to follow: The court posts argument transcripts and audio on supremecourt.gov.
What we know: The justices appear set to keep some kind of comparison rule.
What we don't: How strictly they will define a fair comparison.
Where outlets agree Bloomberg Law and SCOTUSblog both show the court heard Anderson v. Intel on Oct. 6 on whether underperformance claims require a meaningful benchmark.
Where they differ Lawyers who listened in expect the court to keep a comparison rule, but they split on whether it will define the standard narrowly or broadly.