Washington, D.C. — MFA, together with the American Investment Council, filed an amicus brief today urging the Supreme Court of the United States to expand investor access to diversified investment options by clarifying how courts evaluate fiduciary investment decisions. The brief calls on the Court to affirm the Ninth Circuit’s meaningful-benchmark standard in Anderson v. Intel Corporation Investment Policy Committee, which requires courts to evaluate investments against comparable strategies, not hindsight performance.
“American workers with 401(k) plans should have access to the same diversified investment strategies that pensions use to strengthen long-term returns and manage risk,” said Bryan Corbett, MFA President and CEO. “Courts should make clear that fiduciaries are judged on their decision-making process, not on hindsight performance. A clear legal standard will expand investment choice, improving retirement security for millions of Americans.”
ERISA’s prudence standard focuses on the fiduciary’s decision-making process, not subsequent performance outcomes. Yet plan sponsors today can be sued based on hindsight performance comparisons alone. That litigation risk pushes fiduciaries to choose familiar, conventional investment options and leaving alternative assets—including hedge funds, private credit, and private equity—largely absent from 401(k) plans despite their ability to enhance returns and diversify risk.
The meaningful-benchmark standard addresses this by requiring plaintiffs to compare an investment against a genuinely similar strategy before inferring imprudence, rather than pointing to unrelated, better-performing funds in hindsight. Affirming that standard will deter meritless claims, preserve fiduciary discretion, and expand access to diversified investment options for retirement savers.
Read the full amicus brief here.
###
About the global alternative asset management industry
The global alternative asset management industry — including hedge funds, private credit funds, and hybrid funds — serves thousands of public and private pension funds, charitable endowments, foundations, and other global institutional investors. The industry provides portfolio diversification and risk-adjusted returns to help meet their funding obligations and return targets throughout the economic cycle.
About MFA
Managed Funds Association (MFA), based in Washington, D.C., New York City, Brussels, and London, represents the global alternative asset management industry. MFA’s mission is to advance the ability of alternative asset managers to raise capital, invest it, and generate returns for their beneficiaries. MFA advocates on behalf of its membership and convenes stakeholders to address global regulatory, operational, and business issues. MFA has more than 180 fund manager members, including traditional hedge funds, private credit funds, and hybrid funds, that employ a diverse set of investment strategies. Member firms help pension plans, university endowments, charitable foundations, and other institutional investors diversify their investments, manage risk, and generate attractive returns throughout the economic cycle.
