23 1007 Chamber Amicus Brief revised

Chantel Sheaks Chantel Sheaks
Vice President, Retirement Policy, U.S. Chamber of Commerce

Published

January 07, 2025

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The Supreme Court will hear the case Cunningham v. Cornell Universityto decide whether a plaintiff must plead more than the mere occurrence of a prohibited transaction under Employee Retirement Income Security Act to move beyond a motion to dismiss. Although the issue may seem academic, it is extremely important because entering into a contract with a service provider is a prohibited transaction (that has an exemption), and nearly every plan must retain service providers to exist. If the plaintiff wins, this could mean that the plaintiff’s bar would have carte blanche to bring a suit against nearly every employee benefits plan, and then seek discovery to see whether an exemption is satisfied.

In light of this, the Chamber filed an amicus supporting Cornell’s position that a plaintiff most plead more than the mere existence of a prohibited transaction, including pleading whether an exemption exists and facts showing why the exemption was not met.

23 1007 Chamber Amicus Brief revised

About the authors

Chantel Sheaks

Chantel Sheaks

Chantel Sheaks develops, promotes, and publicizes the Chamber’s policy on retirement plans, nonqualified deferred compensation, and Social Security.

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