The conservative majority on the Supreme Court may betray America on cultural issues, but it does equally as impressive legal back flips to protect corporations who want to steal their worker’s pensions.
In Thole v. U.S. Bank, Judge Kavanaugh led a 5-4 ruling stating that the retirees suing their employers for enriching themselves by mismanaging their pension fund did not have standing for legal action due to the fact that they were still receiving money.
According to Kavanaugh, et al, stakeholders in a pension plan do not have a right to sue for fiduciary misconduct until their pension plan finally goes bankrupt. This is the equivalent of having someone steal and then gamble half the money you stored away for years– after taking excessive fees for themselves — and being unable to obtain legal redress because you still have enough leftover to pay your bills in the short term.
The ruling ignores and even neutralizes the rights of workers under existing laws like the Employee Retirement Income Security Act (ERISA), which is meant to curtail the irresponsible management and corrupt self-dealing by capital.
The case of U.S. Bank is egregious. From 2007 to 2010, the bank’s executives had their own subsidiary, FAF Affiliates, take a healthy and over funded pension plan and unilaterally decided to invest it all in the stock market rather than diversify it towards areas of stable growth. Over this three year period, $748 million dollars of the retiree’s money was lost to the Wall Street casino. The executives and speculators in question all compensated themselves with handsome fees for this blunder.
in his majority opinion, Kavanaugh made a painstaking effort to avoid addressing this gross misconduct. The plaintiffs, two retirees, demanded U.S. Bank — whose CEO Andrew Cecere gave himself a 40% salary increase last month — return the money to the pension plan. Kavanaugh threw the case out, arguing that individual pensioners have no say in how their pension plan is being handled until it is insolvent and they no longer are receiving their check.
Somehow the rules for managing pensions are different than those governing private trusts in the eyes of conservative jurors. This will provide huge leeway for corporate America.