Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...
Nov. 12 — Novant Health Inc. has reached a $32 million settlement with its employees who alleged the company's retirement plan committee breached fiduciary duties by overpaying millions of dollars in fees.
The settlement, filed Nov. 9 in the U.S. District Court for the Middle District of North Carolina, still must receive court approval.
The settlement comes less than two months after Judge William Osteen Jr. found that the retirement savings plan participants sufficiently stated a claim for relief under the Employee Retirement Income Security Act by alleging that Novant breached its fiduciary duties by only offering retail class shares of mutual funds even though less expensive institutional shares that provide the same return on investment were available (182 DLR A-4, 9/21/15).
The participants argued in their lawsuit that the plan has a very large pool of assets and plans of such size have the ability to obtain less costly institutional class shares of mutual funds. They asserted that Novant and the plan committee breached their fiduciary duties by offering only the more expensive retail class shares to participants, even though less expensive institutional class shares of the same funds were available.
According to the settlement papers, the settlement class includes all current and former participants and beneficiaries who participated in Novant's retirement plans between Oct. 1, 1998, and Sept. 30, 2015.
A similar settlement recently was reached in a lawsuit against Boeing Co. (214 DLR A-3, 11/5/15). The lawsuit against Boeing—which still awaits court approval—settled for $57 million.
Schlichter Bogard & Denton represented the Novant employees, as well as the Boeing employees. Novant was represented by Morgan Lewis & Bockius.
To contact the reporter on this story: Jo-el J. Meyer in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Phil Kushin at email@example.com
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)