On December 9, 2025, the Solicitor General ("SG"), on behalf of the United States Department of Labor ("DOL") and the United States Department of Justice ("DOJ"), filed briefs with the Supreme Court in two high-profile ERISA class action cases: Pizarro v. The Home Depot, Inc. and Parker-Hannifin Corp. v. Johnson. Both cases involve legal issues—on which lower courts have disagreed—regarding the burden on plaintiffs in cases alleging breaches of ERISA's fiduciary duties.
The SG asked the Court to review both cases and resolve them by adopting legal standards that are more favorable to ERISA plan fiduciaries. The SG's recommendation substantially increases the likelihood that the Court will agree to hear the cases and shows an increasing willingness by DOL to take action to help curb abusive ERISA litigation targeting plan sponsors, which has driven up the costs of administering plans.
1. Pizarro v. The Home Depot: Burden of Proof on Loss Causation
A key issue in ERISA litigation is which party has the burden of proving that a fiduciary breach resulted in a loss to a plan. In Pizarro, the Eleventh Circuit held that a plaintiff has the burden of proof to show that a fiduciary breach caused a loss to a plan. By contrast, the First, Second, Fourth, Fifth, and Eighth Circuits have held that once a plaintiff proves a breach and loss, the burden shifts to the fiduciary defendant to prove that the loss was not caused by the breach.
The SG's brief argues the Eleventh Circuit's view—that plaintiffs have the burden of proving loss causation—is correct. The SG explained that this was a reversal of the government's position in earlier cases, but that "[f]ollowing the change in Administration . . . the government has reviewed its position and concluded that the . . . better [view] . . . leav[es] the burden of proving causation on ERISA plaintiffs."
2. Parker-Hannifin Corp. v. Johnson: Pleading "Meaningful Benchmarks"
Another key issue in ERISA litigation is what a plaintiff must plead at the beginning of a case to allow a court to infer that a breach of fiduciary duty may have occurred. In the context of challenges to plan investment options, the Seventh, Eighth, Ninth, and Tenth Circuits have held that a plaintiff must allege a "meaningful benchmark" that a challenged investment underperformed. Under this standard, a plaintiff must plead facts showing that "benchmark" funds share similar strategies, risk profiles, and objectives as the challenged fund. This standard is often described as an "apples-to-apples" comparison. Many courts have also applied a "meaningful benchmark" requirement for challenges to plan recordkeeping fees.
In Parker-Hannifin, the Sixth Circuit split from the majority of other courts by holding that while "[a] meaningful benchmark may sometimes be one part of an imprudence pleading, . . . is it not required" and that, in any event, a broad "market index" can serve as an "inherently . . . meaningful benchmark." The SG's brief argues that the Sixth Circuit erred by not requiring the plaintiff to plead a "meaningful benchmark" and by concluding that a broad market index was a sound basis for comparison. The SG explained that permitting comparisons to a broad market index without an "apples-to-apples" comparison subjects fiduciaries to improper hindsight bias and fails to screen out meritless lawsuits.
Implications for Plan Sponsors
A Supreme Court decision that adopts the SG's position in one or both cases would help address some aspects of recent ERISA litigation that have driven up the costs of administering plans:
1. Solidifying the Burden of Proof: The practice of shifting the burden of proof to defendants to disprove loss causation can make defending ERISA cases more time-consuming and expensive, and also encourages plaintiffs to pursue cases in which there is little to no loss caused by a fiduciary breach. The SG's position, if adopted by the Court, would help address both of these issues by requiring plaintiffs to prove loss causation.
2. Clarifying the Pleading Standards for Imprudence: The pleading standard in ERISA cases is particularly important given the costs of defending ERISA class actions and the high number of cases that settle. Plaintiffs often base lawsuits on flawed comparisons, which may be allowed to proceed if there is no requirement that the comparisons are a "meaningful benchmark." The SG's position, if adopted by the Court, would help discourage meritless lawsuits and increase the likelihood that they are dismissed before costly discovery expenses are incurred.
Following the Supreme Court's decision earlier this year in Cunningham v. Cornell University, Congress and DOL both appear concerned that it has become too easy for plaintiffs to plead claims that survive a motion to dismiss. In addition to these amicus briefs, Representative Randy Fine (R-Fl. 6th) recently introduced the ERISA Litigation Reform Act (H.R. 6084) ("ELRA") which would require plaintiffs to plead and allege that certain ERISA prohibited transactions were not used by defendants. Plan sponsors and service providers will want to watch these legislative and judicial developments as they could provide a path for courts to more quickly identify and dismiss meritless claims.
We will continue to monitor these petitions as the Court considers whether to add them to its docket. If you have any questions, please contact your regular Groom attorney.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
