PLANADVISER - November/December 2019 - 10

Legislative and Judicial Actions
compliance news
Full 9th Circuit OKs Panel's
Pro-Arbitration Decision
A three-judge panel of the 9th U.S.
Circuit Court of Appeals issued a major
decision in August that was taken to
have shifted the standing of mandatory
arbitration provisions used in operating
Employee Retirement Income Security
Act (ERISA)-governed retirement plans.
The panel concluded that a previous,
precedent-setting
9th Circuit decision,
which held that ERISA claims
are generally not subject to arbitration
provisions, is " no longer good law " in
light of interim Supreme Court rulings.
The underlying case, Dorman v. Charles
Schwab Corp., was initially filed in
2017. In January 2018, a district
court judge denied a motion by
Charles Schwab that sought to
mandate that the suit proceed
via individual arbitration,
rather than as an ERISA class
action in federal court. This denial
kicked off the appeals process, which
led to the three-judge panel's proarbitration
ruling this summer.
Now, the full 9th Circuit has
backed the panel's ruling.
Technically
speaking,
the full court has been
advised of the plaintiff's/appellee's
petition
for a rehearing en banc, and
no judge of the court has requested a
vote on said petition. Thus, the appellee's
petition for rehearing en banc has
been denied.
MIT to Pay $18.1mm
In Lawsuit Settlement
The details of the proposed settlement
in the Employee Retirement Income
Security Act (ERISA) fiduciary breach
lawsuit filed by retirement plan participants
at the Massachusetts Institute
of Technology (MIT) are now public.
District Court Judge Nathaniel M.
Gorton of the U.S. District Court for the
District of Massachusetts previously
moved forward most claims in the suit
but granted summary judgment to the
defendants for a claim alleging a prohibited
transaction between MIT and
Fidelity Investments. The settlement
agreement includes dozens of specific
provisions, to which MIT plan fiduciaries
will have to adhere. In entering
the settlement agreement, the defense
admits no wrongdoing or liability, while
the class of plaintiffs agrees to forego
future litigation of the matters at hand.
despite the fact that the vast majority
of senators have voiced support for the
bill's passage in its current form. In
their letter, American business leaders
suggest that, if the act is not signed
into law, more than 700,000 smallbusiness
workers will be unable to
save for retirement at work; more than
4 million workers in private-sector
pension plans will be at risk of losing
future benefits; 1,400 religiously
affiliated organizations will
be at risk of losing access to
their defined contribution
(DC)
retirement plans;
economically
and more than 18,000
children and spouses of
fallen service members
will continue to be
disadvantaged
by unfair taxation on
their survivor benefits.
IRS May Update Tables Used
To Calculate RMDs
The IRS has issued a notice of
proposed rulemaking to provide
guidance for using life expectancy
and distribution period
tables. These tables are employed
to calculate required minimum
distributions (RMDs) from qualified
Corporate America 'Campaigns'
For SECURE Act Passage
A group of more than 90 CEOs and
senior executives from leading American
corporations and business groups
has issued a public letter calling on
the U.S. Senate to pass the Setting
Every Community Up for Retirement
Enhancement Act, commonly referred
to as the SECURE Act. The plea,
addressed both to Senate Majority
Leader Mitch McConnell and Senate
Minority Leader Chuck Schumer,
comes some months after the U.S.
House passed its version of the SECURE
Act with a nearly unanimous and
bipartisan vote. Since that time and
for a number of reasons, the SECURE
Act has remained stalled in the Senate,
retirement plans, individual retirement
accounts (IRAs) and annuities, as well
as certain other tax-favored employerprovided
retirement
arrangements.
An
executive order signed a year ago
August 31 had directed the secretary
of the Treasury to examine the life
expectancy and distribution period
tables that are cited in regulations
pertaining to taking RMDs from retirement
plans. It also asked the secretary
to determine whether the tables should
be updated to reflect current mortality
data and whether such updates should
be made annually or otherwise periodically.
The purpose of such updates
would be to increase the effectiveness
of tax-favored retirement programs by
allowing retirees to retain savings in
these programs longer-i.e., for their
later years-the executive order said.
10 | planadviser.com November-December 2019
Art by Connor Robinson
http://www.planadviserdigital.com/planadviser/november_december_2019/TrackLink.action?pageName=10&exitLink=http%3A%2F%2Fplanadviser.com
PLANADVISER - November/December 2019

Table of Contents for the Digital Edition of PLANADVISER - November/December 2019
