Washington University in St. Louis agrees to $7.5 million ERISA Settlement
For the last five years, Schneider Wallace Cottrell Konecky has intensively litigated on behalf of Washington University workers in a class action lawsuit for the University’s alleged breach of fiduciary duties in managing and administering its retirement plan.
Washington University has agreed to pay $7.5 million to resolve the claims alleged in the case and compensate workers and beneficiaries of the Washington University Retirement Plan. Schneider Wallace has submitted a motion for a Preliminary Approval Order with the court in the Eastern District of Missouri.
ERISA Lawsuit Against Washington University in St. Louis
In 2017, Plaintiffs brought a lawsuit alleging that Washington University breached duties in violation of the Employment Retirement Income Security Act (ERISA). Plaintiffs sought to recover all alleged losses to the Plan resulting from each alleged breach of duty under ERISA, and costs and fees incurred. The case was brought in the United States District Court for the Eastern District of Missouri.
Plaintiffs obtained 20,000 documents, consisting of more than 113,000 pages, through comprehensive fact discovery against Defendants and third parties. The voluminous documents and deposition testimony obtained by Plaintiffs’ counsel revealed the identity of the Retirement Plan’s fiduciaries, the fiduciary duties imposed upon them under ERISA, and whether they satisfied their fiduciary duties.
On March 15, 2021, Plaintiffs filed their motion for class certification.
In January 2022, the parties engaged in neutral mediation and reached a preliminary settlement of $7.5 million on April 15, 2022.
Providers of 401(k) plans and other retirement plans earn legitimate revenues off the fees they charge for making wise, lucrative investments for participants, but excessive fees are unfair to participants.
Administrators have fiduciary duties to act in the best interest of those with funds invested in plans. Pensions are generally treated as conservative investments that tend to be lower yield, low-risk and long-term. Fees may be considered excessive if:
- The plan engages in excessive transactions that generate unreasonable total commissions.
- The plan charges high fees to manage and operate the plan.
- The plan’s revenue sharing agreement pays high costs for daily operations.
ERISA Settlement Terms
The terms of the proposed settlement include:
- A cash payment of $7,500,000
- Substantial non-monetary relief for class members
The class consists of “all persons who participated in the Plan at any time during the Settlement Class Period, including any Beneficiary of a deceased person who participated in the Plan at any time during the Settlement Class Period, and any Alternate Payee of a person subject to a Qualified Domestic Relations Order that was in effect before the end of the Settlement Class Period”.
The settlement class period is defined as June 8, 2011 through March 31, 2022.
ERISA Law Firm
To learn more about ERISA and 401(k) benefits disputes and remedies, schedule a comprehensive claims assessment with our knowledgeable employee benefits litigation lawyers at Schneider Wallace. Our attorneys are able to schedule meetings over the phone, online, or at our offices in California, Texas, North Carolina and Puerto Rico.