On February 26, 2020, the United States Supreme Court unanimously held that a participant could not be considered to have “actual knowledge” of the employer’s conduct alleged to be a breach of fiduciary duty when such conduct was disclosed in email and Web site disclosures when the participant can’t remember actually receiving or reading the disclosures in Intel Corporation Investment Policy Committee v. Sulyma.  As a result, ERISA’s six-year statute of limitations applied to the participant’s law suit, rather than the shorter three-year statute when the participant has actual knowledge of the conduct giving rise to the breach. The high Court affirmed the decision of the Ninth Circuit that overturned the lower court’s granting of Intel’s motion for summary judgment as beyond the three-year statute.

The district court had ruled that the participant had constructive knowledge of the conduct and the shorter statute applied making the participant’s lawsuit untimely. The high Court looked to the plain meaning of “actual knowledge” in the statute. It stated that although ERISA doesn’t define “actual knowledge”, its meaning is plain and dictionary definitions confirm to have actual knowledge of information one must, in fact, be aware of it. The Court found that while constructive knowledge may be imputed in other circumstances, the addition of the word “actual” in the statute signals that Congress meant knowledge must be more than hypothetical.

The Court acknowledged Intel’s argument that this interpretation makes it easier for participants to bring fiduciary breach claims against employers, even though they were transparent in their disclosures, because they only have to allege that they didn’t read the information. However, the Court responded that it is up to Congress to change the wording of the statute to provide better protection for employers not the Court. The Court also noted that their decision does not affect the way employers can prove that the participant has actual knowledge.