The Action claims that under ERISA, the Defendants owed fiduciary duties of care and prudence to the Plan and that they violated those duties in connection with the selection and monitoring of the Plan’s investment options and service providers. During the Class Period, participants in the Plan were able to allocate their account balances among various investment funds. Named Plaintiffs allege that Defendants that the recordkeeping fees and other expenses associated with certain investment options offered in the Plan were too high. Recordkeeping in simple terms refers to the suite of administrative services provided to retirement plan participants that generally includes provision of account statements to participants.
THE DEFENSES IN THE ACTION
Defendants deny all of the claims and allegations made in the Action and deny that they ever engaged in any wrongful conduct. If the Action were to continue, the Defendants would raise numerous defenses to liability, including but not limited to:
- Defendants did not engage in any of the allegedly improper conduct charged in the Complaint;
- Defendants reasonably and prudently managed the Plan’s investment options and fees, as well as all recordkeeping fees, and fulfilled all of their fiduciary obligations;
- The Plan’s investment options and recordkeeping fees were and are reasonable, prudent, and sound investment options for Plan participants;
- Even if a court were to determine that Defendants failed to discharge any duty under ERISA, any such breach of fiduciary duty did not cause the Plan or its participants to suffer any loss.
THE ACTION HAS BEEN AGGRESSIVELY LITIGATED
Class Counsel has extensively investigated the allegations in the Action. Among other efforts, Class Counsel reviewed Plan-governing documents and materials, communications with Plan participants, U.S. Department of Labor filings, news articles and other publications, and other documents regarding the general and specific matters that were alleged in the complaint filed on September 17, 2020. On August 16, 2021, Plaintiffs filed a motion for class certification. Before Defendants filed any opposition, the Parties began to discuss the possibility of a resolution of this matter through mediation.
On September 21, 2021, the Parties mediated the Action under the supervision of Hunter Hughes, Esq., a mediator experienced in ERISA and other complex class actions. During the full-day mediation, counsel for the Parties conducted extensive, arm’s-length negotiations concerning a possible compromise and settlement of the Action, eventually resulting in the Parties agreeing to a proposed Settlement. The Parties subsequently negotiated the specific terms of the Settlement Agreement and related documents. On December 17, 2021, Named Plaintiffs filed a motion seeking preliminary approval of the Settlement as well as seeking related relief.