Russell sued over investments in Royal Caribbean 401(k) plan

June 11, 2021

A participant in a 401(k) plan run by Royal Caribbean Cruises sued Russell Investment Management LLC, Seattle, for breach of fiduciary duties for stocking the 401(k) plan with proprietary Russell investments.

Royal Caribbean isn't named as a defendant in the case of Ann Johnson vs. Russell Investment Management LLC, filed Monday in a U.S. District Court in Seattle. Ms. Johnson is seeking class-action status as a representative of all participants in the Royal Caribbean retirement plan who invested with Russell.

"Russell's conflicted judgment breached multiple ERISA fiduciary standards, including its duty of loyalty to plan participants and its duty of prudence," the lawsuit said.

"Russell's funds continued to underperform until Russell was eventually removed as the plan's outsourced investment fiduciary in the middle of 2019, less than four years after assuming the role," the lawsuit said. "In the meantime, the plan suffered millions in lost investment returns as a result of Russell selecting an all-proprietary line up for plan participants."

In an emailed statement, a Russell spokesman wrote: "We believe this lawsuit is without merit, and we intend to vigorously defend the firm against these allegations."

Royal Caribbean Cruises Ltd. Retirement Savings Plan, Miami, had $517.8 million in assets as of Dec. 31, 2019, according to the latest Form 5500.