“This can be a new frontier within the lengthy conflict of extreme charge instances,” mentioned Daniel Aronowitz, Vienna, Va.-based managing principal of insurance coverage agency Euclid Specialty Managers LLC. If the BlackRock target-date collection may be efficiently challenged in courtroom, then “each funding may be challenged,” mentioned Mr. Aronowitz, whose fiduciary insurance coverage purchasers embody among the 10 sponsors defending the target-date lawsuits.

“As is at the moment in vogue, defendants seem to have chased the low charges charged by the BlackRock TDFs with no consideration of their means to generate return,” mentioned the Aug. 2 lawsuit towards Microsoft Corp. and its fiduciaries, echoing an identical grievance concerning the different sponsors’ use of the BlackRock target-date collection.

“The defendants breached their fiduciary duties by imprudently choosing, retaining, and failing to appropriately monitor the clearly inferior BlackRock TDFs,” the lawsuit mentioned.

ERISA attorneys and researchers level out that focusing solely on previous outcomes — compared with different suppliers’ target-date collection — doesn’t inform the entire story or describe an entire image about fiduciaries’ obligations.

“It’s clearly greater than numbers: it’s an evaluation of risk-reward,” mentioned Andrew L. Oringer, a New York-based accomplice within the ERISA and govt compensation group at Dechert LLP. “ERISA doesn’t favor hindsight.”

Mr. Oringer, whose regulation agency defends sponsors in ERISA instances, declined to touch upon the BlackRock-related instances besides to say that defendants should present judges they adopted ERISA’s tips in evaluating the professionals and cons of passive administration and lively administration. “ERISA requires you to deliberate,” mentioned Mr. Oringer, who isn’t concerned in any of those instances. “It doesn’t require you to be proper.”

Threat-adjusted returns, underlying investments, glidepath technique and participant demographics are among the vital components in sponsors selecting a target-date collection, outlined contribution trade members say. Ensuring fiduciaries comply with a course of to elucidate their actions is one other.

“You want all of these items to see if the target-date funds meet your targets,” mentioned David O’Meara, New York-based director of investments for Willis Towers Watson PLC, describing discussions with purchasers. The lawsuits citing the BlackRock target-date collection “don’t get into the constructing blocks” of the funding, he mentioned.

“After we work with sponsors, we take a look at their assumptions” based mostly on office demographics and sponsor philosophy about retirement investing technique, mentioned Mr. O’Meara. “There isn’t any proper reply.”

DC specialists additionally say evaluating one supplier’s index-based target-date fund to different suppliers’ passive or actively managed target-date funds is evaluating apples to oranges — and so is evaluating glidepath methods amongst a number of suppliers’ merchandise.

“It’s not an appropriate comparability,” mentioned Mr. Aronowitz, referring to the lively vs. passive approaches. “An lively fund is meant to outperform an index fund as a result of they (asset managers) make tactical modifications” relying on market forecasts.