No breach of fiduciary duty in Unisys Executive Life GIC litigation; ERISA section 404(c) protection upheld
Article Abstract:
The US District Court of Eastern Pennsylvania in 1997's In re Unisys Savings Plan Litigation held against 401(k) employee benefit plan participants in a suit claiming breach of fiduciary duty for Unisys' failed junk bond investments. The court found that the fiduciaries took proper steps to fulfill their duty when investigating, monitoring, and disclosing information about the junk bond investments. Investment in junk bonds and their ultimate failures are not per se breaches of ERISA duties.
Publication Name: Tax Management Compensation Planning Journal
Subject: Law
ISSN: 0747-8607
Year: 1998
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Fiduciaries liable for prohibited transaction excise taxes regardless of civil suit settlement
Article Abstract:
The Tax Court in Clasby v. Commissioner held two pension plan fiduciaries liable under IRC section 4975(a) for excise tax on a prohibited transaction. The transaction concerned the purchase of life insurance policies with pension funds from an insurance agency owned by a fiduciary. The fiduciaries' civil suit settlement was irrelevant to the excise tax assessment.
Publication Name: Tax Management Compensation Planning Journal
Subject: Law
ISSN: 0747-8607
Year: 1999
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