Last Tuesday, a proposed class action lawsuit naming Columbia University was filed in the New York federal district court. In the complaint, the unnamed plaintiff (“Jane Doe”) accused the university of allegedly overcharging administrative fees for participation in its retirement plan. In addition to this allegation, Doe claims that Columbia improperly managed the investment options and selected poorly performing options over alternative investments, thereby reducing the retirement assets of university employees. These actions by the university allegedly caused participants in the university’s retirement plan to lose hundreds of millions of dollars, leading the beneficiaries to ask the court to judge Columbia liable for $100 million in damages.

The complaint against the university seeks class action status, as it represents a proposed class of 27,000+ participants in Columbia’s retirement plans. The suit claims that the university breached its fiduciary responsibility according to the Employee Retirement Income Security Act by allowing participants in the retirement plan to pay unreasonable fees for administrative and investment services in relation to the retirement plan. Because Columbia also allegedly “selected and retained expensive and poor-performing investment options that consistently and historically underperformed their benchmarks and similar funds,” according to the complaint, “Columbia University caused … plans, and hence participants, to suffer hundreds of millions of dollars of staggering losses to retirement savings.”

Columbia has yet to make any official statement regarding the filed lawsuit. Provided that the summary judgement is not reached in favor of either party, the university will ultimately either address its fiduciary responsibility to participants by either settling with the plaintiffs out of court, or face trial.

In addition to Columbia, eight notable universities have been recently named in similar proposed class action lawsuits relating to retirement plan mismanagement and breach of fiduciary duty. These universities include NYU, Yale, the University of Pennsylvania, and MIT, among others.

For the legal-minded, the initial complaint of the lawsuit filed against Columbia and other related court documents can be accessed online through this site ($$, paywall, 14-day free-trial).