The Daily Brief for Benefits Professionals
BenefitsWire
Retirement Plans
June 24, 2026
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9 items · ~3 min read
Top of the Brief
Third Circuit: ERISA Demands a Prudent Process, Not Perfect Investment Performance“In In re Quest Diagnostics ERISA Litigation, — F.4th —-, No. 24-2866, 2026 WL 1783204 (3d Cir. June 22, 2026), the Third Circuit affirmed the District Court's grant of summary judgment to Quest Diagnostics and its plan committees, holding that the fiduciaries of Quest's 401(k) plan did not breach their duty of prudence under ERISA by continuing to offer two underperforming investment options. ... Short-term underperformance, the court held, does not prove long-term imprudence, and ERISA fiduciaries need not select the best available investment to satisfy the duty of prudence.”
In this issue
Expert Analysis (6) · Regulatory Action and Guidance (1) · ERISA Litigation (1) · Retirement Plan Administration (1)
Expert Analysis
6 items“The ruling concludes that the two portions should be analyzed separately under the Code so there are no adverse consequences as long as each portion meets the applicable rules. The favorable rulings apply notwithstanding that the fixed installment annuity payments under the rider will be used to pay premiums under the life insurance contract where they will become part of the policyholder's tax basis. The annuity payments would be taxable under the normal section 72 rules. It is also noteworthy that the annuity rider may be issued as an IRA annuity under Code section 408(b).” MORE >>
Source: Groom Law Group
“Gibson Dunn partners Andrew Kilberg and Brian Richman and associate attorneys Aaron Hauptman and Robert Frey break down the more than 47,000 public comments submitted on the Department’s proposed rule in a detailed white paper, examining who lined up behind the proposed process-based safe harbor, who pushed back, and what the comment docket signals for the shape and timing of the final rule.” MORE >>
Source: Gibson Dunn
“Several letters submitted during the public comment period ending June 1 urged the DOL to include more details and examples about how CITs could be used, and to ensure the final rule is "vehicle-neutral" so plan sponsors and fiduciaries view the trusts on equal footing to mutual funds. ... CITs have been an increasing presence in retirement plans. The collective trusts held 42% of defined contribution plan assets as of 2024, up from 23% in 2015, according to Morningstar's 2026 retirement plan landscape report. The total assets in CITs through defined contribution plans increased in that period from $1 trillion to $3.8 trillion, according to Morningstar.” MORE >>
Source: Bloomberg Law
“The DOL’s proposed regulation on selecting investments, including alternative assets, 2026-06178.pdf, identifies six factors that need to be considered in the process of selecting any investments for participant-directed plans, such as 401(k) plans and private sector 403(b) plans.” MORE >>
Source: Fred Reish
“On March 30, 2026, the Department of Labor released its proposed rule, "Fiduciary Duties In Selecting Designated Investment Alternatives" implementing President Trump's Executive Order 14330 ... With this rule, the DOL proposes a regulatory safe harbor from which the acts of plan fiduciaries of defined contribution plans will be given the presumption of prudence. The comments period has now closed and nearly 45,000 comments were filed, with some comments providing substantive suggestions to improve the implementation of the rule and other comments objecting to the rule because of concern that it will encourage the inclusion of risky, complex, and higher cost investment options, and result in” MORE >>
Source: Boutwell Fay
“On June 17, 2026, the U.S. Department of Labor (“DOL”) issued long-awaited guidance addressing the ERISA status of Trump Accounts.” MORE >>
Source: Groom Law Group
Regulatory Action and Guidance
1 item“According to the guidance, Trump Accounts, also called 530A accounts after the Internal Revenue Code section that governs them, and employer contribution arrangements to them generally will not be considered employee pension benefit plans under the Employee Retirement Income Security Act, provided that employers maintain a limited role and meet specific conditions. ... the department concluded that accounts established for employees' dependents generally do not meet ERISA's definition of an employee pension plan because the retirement benefit belongs to the child, rather than the worker.” MORE >>
Source: PLANADVISER
ERISA Litigation
1 item“In In re Quest Diagnostics ERISA Litigation, — F.4th —-, No. 24-2866, 2026 WL 1783204 (3d Cir. June 22, 2026), the Third Circuit affirmed the District Court's grant of summary judgment to Quest Diagnostics and its plan committees, holding that the fiduciaries of Quest's 401(k) plan did not breach their duty of prudence under ERISA by continuing to offer two underperforming investment options. ... Short-term underperformance, the court held, does not prove long-term imprudence, and ERISA fiduciaries need not select the best available investment to satisfy the duty of prudence.” MORE >>
Source: Roberts Disability Law
Retirement Plan Administration
1 item“Q: We are a public university that sponsors a 403(b) plan. Recently, a terminated employee came to us requesting approval for a 403(b) distribution. The problem is, the recordkeeper involved is not only unrelated to our current plan, but a recordkeeper we’ve never heard of!” MORE >>
Source: PLANSPONSOR