Supreme Court to decide ERISA 401(k) pleading standard in Anderson v. Intel Corp.

The United States Supreme Court has agreed to hear an appeal from former Intel Corporation employees who are challenging dismissal of their breach of fiduciary duty claims brought under the Employee Retirement Income Security Act of 1974 (ERISA).

This case is positioned to be a landmark decision on ERISA pleading standards as the Supreme Court decides whether plaintiffs alleging imprudent investment decisions based on fund underperformance must plead a “meaningful benchmark” as a comparator. The case will be closely watched and has the potential to change the landscape of ERISA litigation.

In this alert, we discuss key implications of the case for plan sponsors to consider.

Case background

The Intel employees filed a class action alleging that Intel mismanaged employees’ retirement funds by investing in custom target-date funds that included investments in private equity and hedge funds. The employees alleged that the Intel funds underperformed relative to mutual funds while charging higher fees. The district court granted Intel’s motion to dismiss, and the US Court of Appeals for the Ninth Circuit affirmed the dismissal in May 2025, holding that the Intel employees “had not plausibly alleged a breach of either the duty of prudence or the duty of loyalty.”

Key issues for the Supreme Court

The Supreme Court must decide whether ERISA imposes a “meaningful benchmark” requirement for claims predicated on fund underperformance. In affirming dismissal, the Ninth Circuit held that when an ERISA plaintiff alleges imprudence based on claims that a prudent fiduciary in like circumstances would have selected a different fund, plaintiffs must identify a comparable investment alternative to show that plan fiduciaries acted imprudently. In other words, plaintiffs must provide “a sound basis for comparison—a meaningful benchmark.”

The Ninth Circuit concluded that the “meaningful benchmark” requirement was “implicit” in the text of ERISA since the standard of care is that of a prudent person “acting in a like capacity … in the conduct of an enterprise of a like character and with like aims.” The Intel employees argue that this requirement imposes a pleading standard that is too stringent for plaintiffs.

Implications of the case

The Supreme Court must consider whether the “meaningful benchmark” requirement is a “categorical rule” that conflicts with the “context-specific inquiry” established in Hughes v. Northwestern University, 595 U.S. 170 (2022). There, the Supreme Court articulated that courts must examine the specific circumstances of a fiduciary’s actions and investment decisions.

The Supreme Court’s decision to grant certiorari in Anderson indicates that the Court intends to provide guidance on the pleading standard for ERISA claims involving fund underperformance. If the Supreme Court adopts the “meaningful benchmark” requirement, plan sponsors would benefit from this result, particularly in defending the selection of investment strategies that incorporate alternative or customized investments, which is at issue in Anderson. Conversely, if the Supreme Court rejects the “meaningful benchmark” requirement, it could open the door to increased ERISA litigation because it would effectively lower the bar for surviving a motion to dismiss.

Moreover, the decision has the potential to impact ERISA litigation more broadly beyond fund underperformance claims, since plaintiffs continue to test novel theories regarding ERISA’s fiduciary duties of prudence and loyalty. Plan sponsors are encouraged to monitor the forthcoming case argument and decision in Anderson.

For additional information, please contact the authors or your DLA Piper relationship attorney.