International Paper - PLANSPONSOR.com

Case 3:06-cv-00703-DRH-CJP Document 2 Filed 09/11/2006 Page 29 of 52117. Consequently, in determining whether a plan administrator or other fiduciary hasfulfilled its obligation to ensure that the fees and expenses assessed against the plan arereasonable and incurred solely in the interest of plan participants, foregone revenue sharing mustbe taken into account.118. Such is the case in IPC’s Salaried and Hourly Plans. The investment managers ofthe Plans’ investment options, including mutual funds and some of the collective trusts, chargeand have charged fees (as part of the investment options’ expense ratio) to the Plans that includemoney with which to make Revenue Sharing payments. However, the available RevenueSharing was not captured and used solely in the interest of the Plans and their participants andbeneficiaries.119. As a result, when the foregone Revenue Sharing – consisting of millions ofdollars – is taken into account, the participants and beneficiaries of the Plans paid unreasonablyhigh fees for the administrative and/or investment management services they received.Revenue Sharing Arrangements Are Not Disclosed to Plan Participants120. Revenue Sharing is not disclosed to plan participants and government regulators,even though it may account for a greater portion of certain categories of service providerpayments than do Hard Dollar disbursements to those same providers.121. Accordingly, industry commentators and experts have dubbed Revenue Sharingpayments to be “hidden fees” that are assessed against 401(k) plans and thus reduce planparticipants’ retirement savings.122. By entering into, allowing, and/or failing to monitor, discover, prevent or recoverthese undisclosed Revenue Sharing arrangements, Defendants have deprived and continue todeprive the Plans’ participants of true and accurate information regarding:29