Why Big Firms Have Paid Billions in ERISA Class Actions
The Employee Retirement Income Security Act has cost large American companies over $6.2 billion in class action suits over the past 18 years, according to a recent report.
The suits ranged from allegations of high 401(k) plan fees and inappropriate investments to misleading disclosures and poor management of plan conversions, according to the report from nonprofit group Good Jobs First, Law360.com writes. The group researched all 1,700 companies on the Fortune 1000 and Fortune Global 500 as well as Forbes’ list of the largest private companies in the country and covers 201 settlements or verdicts reached since 2001, according to the legal news website.
Daimler AG paid out the largest ERISA settlement of the suits covered, agreeing to pay $480 million in 2014 over claims that it improperly cut health benefits for its retired workers, according to Good Jobs First, Law360.com writes. Bank of New York Mellon Corp. took second place, settling a suit for $335 million in 2015 over allegations that it had overcharged several pension funds on foreign exchange trades, according to the report cited by the website.
To put together the report, the group analyzed databases, news sources and annual publications from law firms during the course of “three months of intense research,” according to Good Jobs First research director Philip Mattera, Law360.com writes.