In Cunningham v. Cornell University, the U.S. Supreme Court rejected efforts by plan fiduciary defendants, previously endorsed by several courts of appeals, to require plaintiffs to allege more than the mere existence of a contract with a service provider to withstand early motions to dismiss prohibited transaction claims in excessive fee lawsuits. The decision appears likely to lead to increased litigation, and plan fiduciaries should review their processes and procedures to ensure plans are only paying reasonable fees for necessary services.

On April 18, the Federal Circuit issued a precedential decision in Recentive Analytics, Inc. v. Fox Corp., invalidating under Section 101 of the Patent Act and the two-step Alice test patents using machine learning models. The Federal Circuit acknowledged that “[m]achine learning is a burgeoning and increasingly important field and may lead to patent-eligible improvements in technology.” Nevertheless, the Federal Circuit held that “patents that do no more than claim the application of generic machine learning to new data environments, without disclosing improvements to the machine learning models to be applied, are patent ineligible under § 101.” Although some district courts had previously found claims on machine learning methods patent-ineligible, the Federal Circuit recognized that this case presented “a question of first impression” under its precedent.