'Presumption of Prudence' Not Enough to Block Fannie Mae ERISA Class Action, Judge Rules

, The Litigation Daily


The federal courts have been gradually making life harder for ERISA plaintiffs over the last two decades by concluding that the guardians of employee retirement plans are presumed to be acting prudently when selecting investments. The presumption has been a potent defense in the wake of the subprime meltdown, but it has important limits, as a judge emphasized Monday in a ruling against Fannie Mae.

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