Description: Challenge to the U.S. Department of Labor’s final rule on “Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights” (the Investment Duties regulation).
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Braun v. Walsh
Case Documents:
Filing Date Type File Action Taken Summary 02/28/2023 Motion Download Brief filed in support of motion for preliminary injunction and temporary restraining order. 02/21/2023 Complaint Download Complaint filed. Lawsuit Challenged ERISA Rule on Fiduciaries’ Consideration of ESG Factors. Two individual participants in retirement benefit plans subject to the Employment Retirement Income Security Act of 1974 (ERISA) filed a lawsuit in the federal district court for the Eastern District of Wisconsin challenging the U.S. Department of Labor’s final rule on “Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights.” The complaint alleged that the rule “both permits and encourages plan administrators to consider environmental, social, and governance [(ESG)]… factors when making investments on behalf of plan beneficiaries.” The plaintiffs asserted that the rule violated ERISA and exceeded the Secretary of Labor’s statutory authority. Their allegations included that the rule was “unsupported by substantial evidence because it is unsupported by any evidence reliably demonstrating that fiduciaries that consider ESG factors are acting in the sole interest of participants and beneficiaries, or that companies that consider ESG factors such as climate change and diversity programs drive higher financial returns.”