A Minnesota federal court has again dismissed a proposed class action under the Employee Retirement Income Security Act (ERISA). Former worker Thomas Matula accused Wells Fargo of improperly using forfeited funds from its 401(k) plan. The case is Matula v. Wells Fargo & Co. et al., Case Number 0:24-cv-03703, U.S. District Court for the District of Minnesota.
Matula originally filed suit in June 2024. The ex-worker claimed that Wells Fargo used forfeited funds from its 401(k) plan to offset its contributions to participant accounts instead of paying for plan expenses borne by the participants. A plan obtains forfeited funds when employees leave before their full retirement account vesting date and forfeits employer matching funds previously deposited into their accounts.
According to Matula, Wells Fargo used about $2.2 million in forfeited funds in 2022 to offset its contributions to the plan. As such, the company used the forfeitures to benefit itself rather than plan participants. Matula alleged that the company’s actions violated its fiduciary duties under ERISA and constituted prohibited transactions and other violations of federal law.
The court’s second dismissal comes after a panel of the U.S. Court of Appeals for the Eighth Circuit affirmed its earlier dismissal of the case in June 2025 based on a lack of standing. However, the appellate court said that the lower court’s dismissal should have been without prejudice. As a result, the most recent dismissal order from the lower court includes a new without prejudice clause, but otherwise largely tracks the initial dismissal order.
HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.
