In the waning days of the Bush administration, the Department of Labor (“DOL”) issued Interpretive Bulletin 08-1 (“IB 08-1”) concerning the legal obligations of employee benefit plan fiduciaries when they invest the plan assets they control. Specifically, IB 08-1 addresses plan fiduciaries’ duties in the context of “economically targeted investing,” the investment of plan assets in pursuit of benefits for third parties rather than for plan participants and their beneficiaries. IB 08-1 revises prior regulations on economically targeted investing issued early in the Clinton administration.

The assets held in trust by employee benefit plan fiduciaries represent compensation earned by plan participants. In accordance with the duty of loyalty codified by the Employee Retirement Income Security Act of 1974 (“ERISA”), such assets must be invested with single-minded concern for the welfare of the participants and their beneficiaries. Economically targeted investing contravenes ERISA’s duty of loyalty by permitting, indeed encouraging, plan trustees to invest plan assets to generate ancillary benefits for persons other than the participants whose labor is embodied in those assets.

In the fall of 2006, United States District Judge Dean D. Pregerson handed down United States v. Arnold, which held that U.S. Customs agents violated the Fourth Amendment when they searched a laptop computer belonging to an inbound international traveler at Los Angeles International Airport without any particularized suspicion. The Ninth Circuit recently overturned the district court’s ruling, but the district court’s analytical approach remains of vital interest. That is because the decision was the first in the nation to find that the “border exception” to the Fourth Amendment—which permits law enforcement to conduct suspicionless, routine searches of personal items crossing the international border or its functional equivalent—did not apply to laptop computers. Given its novelty and potential implications for all digital media, it is hardly surprising that the district court’s ruling in Arnold has grabbed the attention of the press, law student commentators, civil liberties lawyers, and, most notably, other judges.