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Don’t Worry, Be Happy

The chamber of the Supreme Court of the United States.

August 11, 2020

Thole v. U.S. Bank, N.A. was a 2020 Supreme Court case about when people have standing to sue. James Thole and Sherry Smith sued over U.S. Bank’s management of a defined benefit pension plan, alleging the bank violated ERISA and engaged in prohibited transactions, causing the plan to become underfunded. U.S. Bank sought to dismiss, arguing the plaintiffs did not have the legal right to sue and the statute of limitations had run out on the ERISA claims. The Supreme Court ruled that the plaintiffs had “no concrete stake in the lawsuit,” because “win or lose, they would still receive the exact same monthly benefits they are already entitled to receive,” thus assuming that those benefits would be available despite the alleged mismanagement. Justice Sotomayor filed a dissent, joined by Justices Ginsburg, Breyer, Elena Kagan. She observed that “the Constitution, the common law, and the Court’s cases confirm what common sense tells us: People may protect their pensions.” She took the majority to task for “overruling, ignoring, or misstating centuries of law” to assert that the Constitution requires beneficiaries to watch idly as their supposed fiduciaries misappropriate their pension funds.”

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