Supreme Court Revives ERISA Suit for 28,000 Cornell Employees

The U.S. Supreme Court unanimously ruled that plaintiffs in ERISA lawsuits, such as the one brought by 28,000 Cornell University employees over excessive retirement plan fees, do not have to prove that statutory exemptions do not apply when alleging prohibited transactions. Instead, it is the responsibility of plan fiduciaries to raise and prove any applicable exemptions as affirmative defenses. This decision overturns a previous appellate ruling that had dismissed the Cornell employees' case for not addressing potential exemptions, making it easier for plan participants to bring similar claims against employers. The Court clarified that plaintiffs need only plausibly allege that fiduciaries engaged in transactions with parties of interest and are not required to anticipate or dispute every possible exemption. Legal experts note that while the ruling may result in more ERISA litigation, courts retain procedural tools to manage meritless claims. The case now returns to the lower courts for further proceedings.