The estate of a late Proctor & Gamble employee is embroiled in a legal battle over his retirement account nearly a decade after his death — with his ex-girlfriend 35 years ago.
Jeffrey Rolison passed away at the age of 59, just months before his planned retirement from his job at P&G. He had been with the company since 1986, choosing the company's employee profit-sharing and savings plans the following year—and naming his girlfriend of nine years, Margaret Losinger (nee Sjostedt), as the beneficiary and “cohabitant “.
The couple split about two years later, according to court documents obtained by Wall Street Journal citing the split as “harsh” and Margaret as unfaithful. Meanwhile, Margaret says the reason they broke up was that she wanted to get married and have children, while Geoffrey didn't. Regardless of the reason for their separation, Jeffrey never updated his beneficiary designation for his retirement plan. The account was reportedly worth over $750,000 at the time of Jeffrey's death and has since grown in value.
Estate Claims Breach of Fiduciary Duty
In the years since his death, Jeffrey's brothers, as co-trustees of his estate, have fought to distribute the retirement account assets to Margaret, arguing that P&G breached its fiduciary duty by not duly informed Jeffrey of his beneficiary designation on file with the company. Had he been properly informed that he still had Margaret listed as the beneficiary, the estate argues that Jeffrey would have chosen to change it to a family member. As supporting evidence, the estate presented the court with the fact that Jeffrey updated the beneficiaries on his other accounts after major life events — for example, he removed his long-term partner Mary Lou Murray as the beneficiary on his life insurance policy after the separation theirs.
In their defense, P&G has asserted that they did, in fact, notify Jeffrey on multiple occasions of his beneficiary options, for example, when they changed service providers for the plan, and that “any previous beneficiary designation on file with the plan will have been retained by P&G” because it had no designation on file online (Jeffrey's designation was in a handwritten form like it was done in the old days).
In April 2024, the federal court found in Margaret's favor, noting that communications with Jeffrey regarding his account explicitly included recommendations that Jeffrey revise his beneficiary designation. The funds remain in escrow, however, as the estate has appealed the decision.
Margaret may receive an unexpected fortune
The chances of winning Jeffrey's estate on appeal appear to be slim, according to Denise Appleby, CEO of Appleby Retirement Consulting Inc., who thinks “Margaret will likely get to keep the assets because Jeffery was unmarried at the time of his and his ex's death. -The girlfriend is the registered beneficiary.” As the court noted, she said Jeffrey had plenty of opportunities to change the beneficiary designation, but he did not.
On appeal, “Jeffrey's siblings' attorney could argue that he didn't make the change because he was led to believe that his estate would inherit the account,” Appleby opined, but alas, “that would be speculation clean,” she added. .
The conversation then turns to whether retirement plans can better handle beneficiary designations. For example, health insurance plans require annual re-enrollment with requirements to confirm beneficiaries on file. Absent any legislative initiative, however, it seems unlikely that Jeffrey's estate will have any luck overturning the decision on these grounds.
The case serves as an important reminder for clients to regularly review and update their beneficiary designations and estate planning documents.