Amanda Perkins v. United Surgical Partners International, Inc., et al.

Dallas, Texas employment law lawyer represented Plaintiff who sued Defendant on an Employee Retirement Income Security Act (ERISA) entitlement theory.





This was a putative class action suit for breach of fiduciary duty under the Employee Retirement Income Security Act of 1974 (ERISA). The plaintiffs are five former employees of United Surgical Partners International, Inc. (United Surgical) who previously participated in the now terminated United Surgical 401(k) Plan (the Plan). The Plan merged into the Tenet Healthcare Corporation 401(k) Retirement Savings Plan effective January 1, 2019. All participant account balances were transferred to the Tenet Plan, and the United Surgical Plan ceased to exist. So, the plaintiffs assert claims solely with respect to administration of the United Surgical Plan between April 15, 2015, and December 31, 2018 (the class period).



United Surgical was the Plan sponsor and named fiduciary during this period. Acting through its Board of Directors, United Surgical appointed the Retirement Plan Administration Committee of United Surgical Partners International, Inc. (the Committee) to, among other things, ensure that the investments available to the Plan participants were appropriate, had no more expense than reasonable, and performed well as compared to their peers.



The Plan at issue is a defined-contribution plan, which "provides for an individual account for each participant and for benefits based solely upon the amount contributed to the participant's account.”[1] Unlike a defined-benefit plan, each participant has discretion to direct his or her plan contributions to one or more investment options in a lineup chosen by the plan's fiduciaries. Each participant's account value fluctuates with changes in the value of the investment chosen by the participant.



Like all defined-contribution plans, the Plan incurred investment management fees and plan administration fees. Investment management fees are fees charged by the companies that manage the investment options offered in the Plan and are usually paid out of a participant's account as a percentage of the participant's holdings, known as an expense ratio. Plan administration fees include recordkeeping expenses, which is a catchall term for the suite of administrative services typically provided to a defined-contribution plan by the plan's recordkeeper. Recordkeeping fees can either be paid directly from plan assets or indirectly by the plan's investments in a practice called "revenue sharing.” Revenue sharing payments are payments made by investments within the plan-typically mutual funds-to the plan's recordkeeper or to the plan directly to compensate for recordkeeping and trustee services that the mutual fund company otherwise would have to provide.



The plaintiffs bring two counts against the defendants: breach of the fiduciary duty of prudence against the Committee and failure to adequately monitor other fiduciaries against the Board of Directors and United Surgical.



Count one of the complaint alleges that the Committee breached its fiduciary duty of prudence in three ways: "(1) failing to objectively and adequately review the Plan's investment portfolio with due care to ensure that each investment option was prudent in terms of cost; and (2) maintaining certain funds in the Plan despite the availability of identical or similar investment options with lower costs and/or better performance histories; and (3) failing to control the Plan's administrative and recordkeeping costs.”[2]



Count two of the complaint alleges that the Board of Directors and United Surgical had a duty to monitor the Committee and ensure the Committee was adequately performing its fiduciary obligations. The plaintiffs allege that the Board and United Surgical breached this duty by failing to monitor and evaluate the performance of the Committee; failing to monitor the process by which the Plan's investments were evaluated and failing to investigate the availability of identical lower-cost funds; and failing to remove the Committee as a fiduciary whose performance was inadequate.



The defendants moved to dismiss the plaintiffs' complaint in its entirety for three reasons: (1) the plaintiffs fail to state a claim for breach of the duty of prudence and the breach of the duty to monitor; (2) the plaintiffs lack Article III standing; and (3) plaintiffs cannot support claims of liability against the Board of Directors or individual doe defendants.

Perkins v. United Surgical Partners Int'l (N.D. Tex. 2022)

The Court GRANTED the defendants' motion to dismiss. Because the deficiencies outlined in its order could possibly be cured by amendment, the plaintiffs may amend their complaint within twenty-eight days of this order. Leave to amend does not extend to the plaintiffs' request for injunctive relief or to their claims against the Board or the doe defendants.[48] The plaintiffs may make no other changes than the ones this order addresses.



04/14/2023 49 Transcript Order Form: re 48 Notice of Appeal,,,,, transcript not requested Reminder: If the transcript is ordered for an appeal, Appellant must also file a copy of the order form with the appeals court. (Gyandoh, Mark) (Entered: 04/14/2023)

04/14/2023 USCA Case Number 23-10375 in USCA5 for 48 Notice of Appeal filed by Terry J Willams, Amanda Perkins, Karley Mayhill, Tanya C Standifer, Heather C Holst. (svc) (Entered: 04/14/2023)