ERISA litigation, once considered a dull backwater of the law, has been gaining increased interest and attention in recent years: the result of an aging population and an increasingly sophisticated and aggressive plaintiffs' bar. In the last quarter-century, since 1984, the Supreme Court has decided no fewer than 58 ERISA cases, including three significant decisions last term:

[1]

Conkwright v. Frommert, __ U.S. __, 130 S.Ct. 1640 (2010), in which the Supreme Court reaffirmed its longstanding policy of deference to Plan administrators, and overturned a Second Circuit holding that a court need not defer to an administrator's interpretation of a Plan "where the administrator ha[s] previously construed the same [Plan] terms and [the court] found such a construction to have violated" the statute;

[2]

Hardt v. Reliance Standard, 130 S. Ct. 2149 (2010), in which the Supreme Court clarified the standard for attorneys' fee awards to a "prevailing party" -- allowing such awards whenever a claimant showed "some degree of success" even if there was no enforceable judgment on the merits -- ; and

[3]

Kennedy v. Dupont, 555 U.S. __, 129 S.Ct. 865 (2009), in which the Court held that an ex-wife's waiver of rights to her ex-husband's benefits, as part of a divorce decree, did not validly divest the ex-wife of her rights to those benefits, absent some amendment of the Plan designation form or "succeeding designation of an alternate payee."

One result of this attention is that plaintiffs' counsel have become increasingly aggressive in suing ERISA fiduciaries and related parties -- including top corporate management -- who are alleged to be "knowing participants" in an ERISA breach. These suits generally allege violations of ERISA Section 404 (duty of loyalty) and/or Sectio 406 (setting out various prohibited transactions). There are two broad categories of these suits:

[1]

Stock-drop cases, which allege malfeasance by Plan fiduciaries in continuing to offer a company's stock as part of an ERISA Plan, after the stock drops significantly as a result of circumstances which the Plan fiduciaries allegedly knew or had reason to know. These suits resemble securities fraud cases. However, they are sometimes more attractive to plaintiffs, because they do not have the same heightened pleading (scienter) requirements, and include statutory attorneys' fees as an alternative to common fund recovery. See, e.g., In re Citigroup ERISA Litigation, 2009 WL 2762708 (S.D.N.Y 2009); In re Harley-Davidson, Inc. Securities Litigation, 650 F.Supp.2d 953 (E.D. Wis. 2009)

[2]

Excessive-fee cases, which allege imprudence by Plan fiduciaries by selecting overpriced, high-fee investment options, and failing to disclose the Plan's fee structure. See, e.g., Hecker v. Deere & Co., 556 F.3d 575 (7th Cir. 2009); Braden v. Wal-Mart Stores, 588 F.3d 585 (8th Cir. 2009).

Although these cases have met with mixed success, they show no signs of going away. They are rapidly becoming part of the legal landscape for companies that maintain ERISA plans, and for the insurance and financial services companies involved in the administration of these Plans.