A former participant in the Parsons Corp. Retirement Savings Plan filed a class action complaint accusing Parsons Corp. and the fiduciaries overseeing its 401(k) plan of violating the Employee Retirement Income Security Act by retaining an allegedly underperforming mutual fund for more than a decade, costing participants more than $28 million in retirement savings.
The complaint, filed June 30 in U.S. District Court for the Eastern District of Virginia by plaintiff Christopher Solee, alleges that plan fiduciaries breached their duty of prudence by continuing to offer the Nuveen Dividend Growth Fund despite years of underperformance relative to its benchmark, the S&P 500, and comparable actively managed funds. The lawsuit seeks to recover losses allegedly suffered by retirement plan participants on behalf of all participants.
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According to the complaint, the Nuveen Dividend Growth Fund was added to the Parsons retirement plan in 2012 and consistently trailed the S&P 500. The complaint alleges the fund underperformed the index by more than 46% from 2012 through June 2020, then fell more than 37 percentage points behind the benchmark in the period from July 2020 through December 2025.
The complaint also alleges the dividend growth fund’s performance ranked in the bottom quartile of large-cap blend funds across one-, three-, five- and 10-year periods as of September 2025, while charging higher fees than comparable funds. It further claims that plan fiduciaries continued offering the fund’s more expensive Class I shares, even though lower-cost Class R6 shares were available to qualified retirement plans beginning in 2013.
In addition, the complaint alleges the Nuveen fund experienced more than $300 million in net cash outflows from 2016 through 2025, which Solee argues should have signaled to prudent fiduciaries that investors were losing confidence in the fund. The lawsuit contends Parsons did not remove the investment until December 31, 2025—more than five years after the complaint says it should have been replaced.
The plan serves more than 15,000 current and former employees and beneficiaries, according to the complaint. As of December 31, 2024, nearly $63 million in plan assets remained invested in the Nuveen Dividend Growth Fund’s Class I shares.
The case was filed on behalf of Solee by Sanford Heisler Sharp McKnight.
Charles Field, co-chair of the firm’s financial mismanagement and ERISA litigation practice group, said in a statement that Parsons “failed the plan by failing to remove the disastrous Nuveen Dividend Growth Fund.”
Parsons did not respond to a request for comment.
