Mitsubishi Chemical Group Sued by Former Worker

Mitsubishi Chemical America’s retirement plan fiduciaries are facing a class action complaint filed against the company on July 19 that alleged they caused plan participants to pay excessive fees for administrative services and failed to negotiate lower per-participant fees.

Robert Humphries, a former employee sued Mitsubishi Chemical America Inc., the retirement plan administrative committee and the signatory of the plan’s annual Form 5500, claiming the defendants failed to investigate the availability of lower-cost share classes of certain mutual funds, failed to prudently select and monitor the plan’s stable value fund and failed to appropriately monitor and supervise investment professionals responsible for carrying out its investment strategy. The complaint was filed in U.S. District Court for the Southern District of New York.

“The erosive effect of excessive fees and the resulting lost returns compounds over time substantially lowering the corpus of participants’ retirement investment,” the complaint states.

Kitty Antwine, who filed the plan’s Form 5500 plan to the IRS, was a fiduciary to the plan during the purported class period and is a named defendant, as are 10 unnamed people.

“Because the Plan could have invested in identical mutual funds with a lower share class, Defendants’ actions were directly erosive to the Plan’s growth,” the complaint adds. “Defendants thus caused Plaintiff and other Plan participants/beneficiaries harm by not just forcing them to pay higher fees, but also caused lost yield and returns as a result of those higher fees on the majority of investments offered through the Plan.”

Humphries is seeking compensation to the plan for all losses resulting from the defendants’ breaches of fiduciary duties and the restoration to the plan of any lost profits, the complaint shows.

Though not named as defendants, certain service providers are fiduciaries to the plan participants and are parties in interest to the lawsuit, whose service and compensation the defendants had a duty to monitor: Prudential Trust Co., which served as trustee of the plan; Prudential Insurance Co. of America and Prudential Retirement Insurance and Annuity Co. which served as custodians to the plan for certain investments; and UBS Financial Services Inc. was the plan’s financial consultant from 2017 to 2020, followed in 2020 by SageView Advisory Group LLC, according to the complaint.  

The plan was established on January 1, 1994, and was known as the Mitsubishi Chemical Holdings America Inc. Employees’ Savings Plan until April 1, 2017, the complaint states.

Throughout the class period, the plan had up to 4,656 participants and between $376.7 million and $700.3 million in assets. As of December 31, 2021, the plan had more than 4,656 participants, according to the complaint.

The plaintiff seeks to certify a class period applying to all participants in or beneficiaries of the Mitsubishi Chemical America Employees’ Savings Plan from six years prior to the filing of the complaint through the date of judgment, excepting the defendants.

Representatives for the defendants did not return a request for comment.

Humphries is represented by attorneys with the law offices of Pomerantz LLP, based in New York City.