Anderson v. Intel Corporation Investment Policy Committee

From 2000 to 2015, Winston R. Anderson was a participant in two Intel Corporation retirement plans: the Intel 401(k) Savings Plan and the Intel Retirement Contribution Plan. In the aftermath of the 2008 financial crisis, Intel changed the structure of its proprietary investment funds—used within these plans—to include allocations to hedge funds and private equity, in addition to traditional assets like stocks and bonds. According to Intel, this strategy aimed to reduce volatility and protect against downturns, though it acknowledged the funds might underperform in bull markets. Anderson claims that these changes led to persistently poor returns due to allegedly excessive risk, high fees, and deviation from industry standards. He also alleges disloyalty by Intel fiduciaries, asserting they invested plan assets in ways that provided indirect benefits to Intel Capital, a venture capital arm of the company, rather than prioritizing participants' financial interests. In 2019, Anderson filed suit in the U.S. District Court for the Northern District of California, seeking to represent a class of Intel retirement plan participants whose assets were invested in Intel’s target-date or global diversified funds since 2009. His complaint alleged breaches of ERISA’s duties of prudence and loyalty. After multiple amended pleadings and dismissals, the district court held that Anderson failed to identify any “meaningful benchmark” against which to measure the imprudence of the Intel funds’ strategy and failed to plausibly allege a conflict of interest. The U.S. Court of Appeals for the Ninth Circuit affirmed, rejecting Anderson’s underperformance theory and emphasizing that ERISA requires pleading a plausible inference of flawed investment process—not merely suboptimal results—and, where appropriate, comparison to suitably similar investment alternatives.