Trader Joe’s, the iconic food retailer, has been sued over its retirement plan by former employees who claimed to have lost millions of dollars through the company’s mismanagement of their funds.

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Trader Joe’s, Pasadena, Calif.

At issue is the fee charged annually for the maintenance of each account. The plaintiffs’ lawyer argues that the fee rose to $140 per participant as opposed to a “reasonable” $40 record-keeping fee.

The lawsuit, filed under the provisions of the Employee Retirement Income Security Act (ERISA), claims the retailer sidestepped its “tremendous bargaining power” granted to it by its scale in assets under management — $1.6 billion — by “inappropriately” choosing relatively expensive mutual fund share classes, jacking up the percentage going to the plan maintenance firm.

According to the lawsuit, statistics compiled by the Department of Labor (DOL) show that a 1-percent higher level of fees over a 35-year period makes for a 28-percent difference in retirement assets at the end of a participant’s career.

“Trader Joe’s, as the Plan Sponsor, breached its fiduciary duty of prudence and loyalty and mismanaged the Plan by paying excessive record-keeping fees to the Plan’s record-keeper, Capital Research & Management Co. (“Capital Research”) by failing to limit Capital Research’s asset-based fees to a reasonable amount,” the legal filing claims.

High-profile tort lawyer Jerome Schlichter is leading the charge. He is currently involved in similar lawsuits with Ameriprise Financial, Edison, Fidelity Investments and Lockheed Martin.

Trader Joe’s, now with more than 500 locations, first opened in 1967 in Pasadena, Calif.