In Bidwell v. University Medical Center, Inc., the Sixth Circuit ruled that an employer was not liable for resulting financial losses when it transferred assets in participants’ retirement plan accounts from a stable value fund to a Qualified Default Investment Alternative (“QDIA”) even though the participants had previously elected the stable value fund. For those unfamiliar, QDIAs are funds in which a participant’s account can be invested if the participant fails to give investment direction. QDIAs are designated by the plan administrator and have greater risk (and thus the potential for greater returns) than stable value or similar conservative funds, which may not keep pace with inflation. The plan administrator is protected from having to make participants whole for investment losses for amounts invested in QDIAs, provided the procedural rules of the regulations are followed.
In the case,