Parties in the landmark Tibble v. Edison lawsuit have agreed the defendant, Edison International, will pay more than $13 million in damages to cover allegations of excessive 401(k) fees.
After 10 years of litigation, which included a trip to the Supreme Court, a California judge last month laid to rest the remaining points of contention by ruling in favor of plaintiffs, who alleged fiduciaries of the Edison 401(k) plan selected high-cost retail shares of investment funds as opposed to lower-cost institutional shares.
The August ruling didn't include a complete set of damages. The parties had agreed to $7.54 million in damages for the period from 2001 to January 2011, when the 17 higher-cost funds in question were present in the roughly $4 billion 401(k) plan.
But, damages for the remaining period, February 2011 to the present, were absent. Parties submitted a joint stipulation Sep. 5 in California district court saying "opportunity loss damages" amounted to $5.62 million for that time period.
The Tibble suit is only the second case of its kind to have received judgment following a trial. These cases often settle before trial, the largest settlement being $140 million.
Judge Stephen V. Wilson said in a Sep. 5 order the calculation "accurately" states the plan's total losses resulting from breach of fiduciary duty. He said the court will separately determine any fees, cost and expenses defendants will pay to plaintiffs' attorneys.
Plaintiffs are represented by Jerome Schlichter of Schlichter, Bogard & Denton, a pioneer of 401(k) excessive fee suits.