Supreme Court justices signaled during oral arguments on Oct. 6 that they are likely to side with Intel Corp. in a major lawsuit over private investments in 401(k) plans. The case, Anderson v. Intel Corp. Investment Policy Committee, centers on whether employees must propose a specific benchmark to prove a retirement plan underperformed due to imprudent management.
The dispute does not challenge the use of alternative assets like hedge funds or private equity in 401(k) plans. Instead, it addresses the legal standard for underperformance claims. Employees argued that Intel's relatively low returns breached fiduciary duty. Lower courts rejected this view, ruling that claims of underperformance alone are insufficient without a "meaningful benchmark" for comparison.
During the hearing, several justices used a fruit metaphor to express skepticism toward the employees' position. Justice Clarence Thomas stated that one cannot compare apples and oranges, specifically noting that high-risk funds designed for high returns cannot be compared to funds designed to protect against losses. Justices Elena Kagan, Samuel Alito, Amy Coney Barrett, and Neil Gorsuch echoed this reasoning, with Gorsuch asking the employees' attorney to agree that a meaningful benchmark is required.
Ronald Mann, co-director of the Charles Evans Gerber Transactional Studies Center at Columbia Law School, analyzed the arguments on SCOTUSblog and noted that several liberal justices appeared to align with this line of reasoning. He observed that when justices ask opposing counsel to choose among approaches for an opinion, it usually indicates they are not voting for that side. Aimee Brown, assistant to the Solicitor General, argued the court should suggest parameters for what constitutes a meaningful benchmark, stating that prudence is about process rather than performance.
The legal landscape for alternative investments in 401(k) plans has shifted repeatedly in recent years. Under President Donald Trump's first term, the Labor Department issued an Information Letter in June 2020 supporting access to alternative investments. In December 2021, the Department under President Joe Biden issued a supplemental statement arguing that most fiduciaries were not suited to evaluate these complex assets, which had a chilling effect on the market.
In Trump's second term, the administration reversed course again. In August 2025, Trump issued an executive order to democratize access to alternative assets. In March, the Labor Department proposed a rule to ease regulatory barriers for adding these investments to retirement plans. Eugene Scalia, former U.S. Secretary of Labor and partner at Gibson Dunn & Crutcher, submitted an amicus brief supporting Intel, stating that a ruling in Intel's favor would affirm that private funds are appropriate components of 401(k) options.
Despite regulatory changes, most large companies do not currently offer private investments in their 401(k) plans. Kent Mason, partner at Davis & Harman, expects smaller and mid-size companies to adopt these investments before large corporations, which face higher litigation risks. He noted that even if the Supreme Court sides with Intel and new rules are adopted, plaintiffs' attorneys will likely continue to sue large companies alleging failures in fiduciary obligations.
Asset management firms are preparing for increased adoption. Voya Financial announced a partnership in July 2025, while OneDigital and Principal Financial Group announced similar partnerships earlier this year. Constitution Capital Partners launched a collective investment trust in September with initial assets exceeding $50 million across 18 retirement plans. Amy Vaillancourt, president of retirement at Voya Financial, said research found nearly two-thirds of participants want access to private market investments.