CenturyLink Employees Fight Motion to Dismiss 401(k) Class Action

Plaintiffs in a CenturyLink class action lawsuit recently argued against dismissal of their case, saying that a magistrate judge was too harsh.

According to the plaintiffs, U.S. Magistrate Judge Nina Y. Wang held their claims to an unfair standard by concluding that they hadn’t sufficiently brought allegations under the Employee Retirement Income Security Act (ERISA).

“The recommendation held plaintiffs to a standard of pleading that required them to anticipate and plead every possible defense available to defendants, while failing to view the allegations in the light most favorable to the plaintiffs,” the plan participants said while arguing against dismissal.

The plaintiffs also contend that CenturyLink Investment Management should have known that including five investment managers in the management of their fund would “virtually” guarantee that the CenturyLink Active Large Cap U.S. Stock Fund would not meet its goal.

According to the plaintiffs, their amended CenturyLink class action included an explanation why a prudent fiduciary wouldn’t have chosen five managers at a time to manage the fund.

Additionally, they argue that their CenturyLink ERISA class action isn’t required to “plead facts tending to rebut all possible lawful explanations for a defendant’s conduct” in order to sufficiently bring allegations of breach of fiduciary duty.

While Judge Wang concluded that participants in the CenturyLink class action were claiming that CenturyLink Investment Management acted unwisely only by including the fund, the plaintiffs argue that their claims actually allege that the plan itself was unwisely designed because it included the fund. This distinction, the plaintiffs argue, makes a large difference in their class action claims.

Magistrate Judge Wang also denied the plaintiffs leave to amend their claims and refile, as she said allowing the opportunity to amend would be futile.

However, plaintiffs say that they wouldn’t have been able to amend their claims effectively until after discovery from CenturyLink – discovery which occurred over the past three months.

Due to this, plaintiffs have requested that the court give them leave to file their third amended complaint. The second amended complaint was filed to add an additional plaintiff.

The CenturyLink class action lawsuit was originally filed in November 2017 against CenturyLink and CenturyLink Investment Management, the party which manages the company’s benefits.

Plaintiffs in the CenturyLink class action argued that the management company breached its fiduciary duties under ERISA by wrongfully including the CenturyLink Active Large Cap Stock Fund and then failing to monitor the fund’s performance and replace it when it underperformed by two percent over a five year period.

“Given the number of years of consistent underperformance, the recommendation should have inferred either that CIM was aware of the fund’s underperformance but failed to either correct or replace the Large Cap Fund or was unaware of the Large Cap Fund’s underperformance,” the plaintiffs argued. “In either circumstance, CIM breached its duty to monitor and replace the Large Cap Fund.”

Plaintiffs  are represented by Paul R. Wood, Keith R. Scranton and Devyn R. Glass of Franklin D. Azar & Associates PC.

The CenturyLink ERISA Class Action Lawsuit is Birse, et al. v. CenturyLink Inc., et al., Case No. 1:17-­cv­-02872, in the U.S. District Court for the District of Colorado.