St. Louis attorney Jerry Schlichter’s ongoing efforts to challenge excessive fees in 401(k) retirement plans have secured $334 million in settlements for clients since 2010.
According to a Wall Street Journal profile about Schlichter, his work wasn’t taken seriously when he started filing the suits 10 years ago, but companies now are so worried about being hit with a suit about the mismanagement of the retirement plans that they’ve created a new term for the threat: “getting Schlichterized.”
In 2006, the firm filed a dozen lawsuits against company 401(k) plans. Last year, his firm filed 14 cases against employers, including prominent universities such as Yale and the Massachusetts Institute of Technology.
Consumer advocates say the cases have pushed down 401(k) fees, but critics contend the fear of litigation is causing employers to focus on fees instead of service and innovation.