US Supreme Court Hears Intel 401(k) Dispute: Is the Door to Alternative Funds Opening Wider?
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- Sidang Mahkamah Agung AS membahas tuntutan mantan karyawan Intel atas kinerja dana pensiun yang dinilai jeblok, dengan hakim cenderung berpihak pada Intel.
- Putusan pro-Intel berpotensi melonggarkan masuknya dana lindung nilai dan ekuitas swasta ke program 401(k), meski perusahaan besar diperkirakan tetap hati-hati.
- Regulasi Departemen Tenaga Kerja AS dan putusan pengadilan akan menentukan arah adopsi dana alternatif, dengan implikasi pada pasar modal global termasuk Indonesia.
The United States Supreme Court held a hearing in a case that could reshape the retirement investment landscape in the US. The case, Anderson v. Intel Corp. Investment Policy Committee, centers on a claim by former Intel employees who accuse the company's retirement plan managers of breaching their fiduciary duty by placing participants' money in hedge funds and private equity vehicles whose performance fell short of expectations.
A lower court had earlier dismissed the lawsuit. Its reasoning: poor performance alone is not enough to establish a legal claim without a meaningful benchmark to assess whether the investment decision was prudent. That is the core of the dispute now being tested before the nine justices: how far plan participants can sue fund managers over disappointing investment results.
In oral arguments this week, a majority of the justices appeared skeptical of the plaintiffs' position. They repeatedly used fruit analogies to suggest that comparing high-risk funds with conservative ones is like comparing apples and oranges. Justice Clarence Thomas, for instance, held that the Ninth Circuit Court of Appeals decision could not equate funds designed to pursue high but risky returns with funds meant to protect against losses. Justice Elena Kagan, from the liberal wing, likewise stressed the need for an equivalent comparator. Justice Neil Gorsuch, meanwhile, pressed the plaintiffs' lawyer, Matthew Wessler, to acknowledge the principle that poor-performance claims still require a relevant benchmark.
The government's position, represented by Aimee Brown of the Solicitor General's Office, emphasized that prudence is more about process than outcome. Brown urged the Supreme Court to set certain parameters for what counts as a meaningful benchmark. However, lawyers who followed the hearing judged that the justices' questioning leaned toward Intel. Analysts from SCOTUSblog noted that when justices ask a party to choose among available approaches, it is usually a sign that the vote will not go that party's way.
For businesses, the Supreme Court's decision will determine whether they dare to add alternative instruments to their 401(k) menus. Until now, many companies have held back for fear of being sued. Eugene Scalia, a former US Secretary of Labor who is now a partner at the law firm Gibson Dunn & Crutcher, argued that a ruling in Intel's favor would strengthen the Department of Labor's rule and give plan managers a sense of security. Similarly, Joshua Lichtenstein of Ropes & Gray said a positive outcome would push companies that have so far hesitated to act quickly.
Even so, not everyone will immediately change strategy. Kent Mason, a partner at Davis & Harman who represents large companies, predicted that giant corporations would in fact be the slowest to adopt alternative funds because of higher litigation risk. He expects mid-sized and small companies to move first. Even if the new rule is enacted, the six-factor analysis proposed by the Department of Labor is still seen as subjective, leaving room for lawsuits.
"Private funds can be an effective and entirely appropriate component of 401(k) investment options. A ruling for Intel would affirm that," said Eugene Scalia.
The history of US regulation on alternative funds has indeed been up and down. The Employee Retirement Income Security Act (ERISA) of 1974 did not explicitly prohibit alternative investments, but the Trump administration encouraged their inclusion through an information letter in 2020. The Biden administration then reinforced a cautious stance in 2021, before Trump again issued an executive order in August 2025 to open access to alternative funds. Congress also introduced the Retirement Investment Choice Act in October 2025, and the Department of Labor released a proposed rule in March of this year.
On the industry side, momentum is building. Several large fund managers such as Empower, Voya Financial, OneDigital, and Principal Financial Group have formed partnerships to offer alternative products within 401(k) plans. In September, Constitution Capital Partners launched a collective trust product with more than USD 50 million in initial assets and short-term commitments exceeding USD 1 billion. A Voya survey showed that nearly two-thirds of plan participants want access to private market investments.
This development is worth watching from Indonesia. Although the country's pension system is different, the global shift toward diversifying into alternative instruments could affect the fund allocations of institutions such as BPJS Ketenagakerjaan and private pension funds. If global money flows more heavily into private equity and infrastructure, the impact will be felt in capital flows to emerging markets, including Indonesia. The Financial Services Authority (OJK) and domestic industry players need to examine how fiduciary frameworks and participant protections are built so they do not merely copy models without supervisory readiness.
What is most awaited now is the Supreme Court's ruling and the finalization of the Department of Labor's rule. If both point toward loosening, a wave of new products could quickly flood the US 401(k) market. But the big question remains: are fund managers around the world, including in Indonesia, ready to manage far more complex risks and governance once alternative funds enter retirement portfolios?
