Mutual of America agreed to settle an ERISA excessive fee lawsuit filed by 401(k) participants last week. The preliminary settlement notice filed Friday in a U.S. District Court in New York did not reveal the terms of the settlement.
The plaintiffs alleged in a complaint filed last September that Mutual of America caused plan participants to pay excessive administrative fees by “using its own proprietary recordkeeping platform and by failing to monitor or control the Plan’s administrative expenses.”
The court ordered the plaintiffs to file their unopposed motion for preliminary approval of the settlement by April 14 for a hearing on the motion scheduled for June 6 in New York City.
Elsewhere, an ERISA lawsuit filed against ADP Inc. by a company that participates in the ADP TotalSource Retirement Savings Plan was dismissed by a federal judge in Newark, New Jersey, last week.
According to a filing Friday, the court backed ADP's motion for dismissal against McCaffree Financial Corp. of Overland Park, Kansas, saying the plaintiff “failed to sufficiently plead constitutional standing.”
The case was originally brought in May 2020 with plaintiffs claiming ADP caused the plan to pay excessive record-keeping fees to Voya Institutional Plan Services, the plan’s record keeper since 2013. The case was dismissed last April after the court found the participating employer was not a fiduciary with respect to the allegations in the lawsuit. The latest dismissal involved an amended version of the complaint.
In its ruling, the Court held that the amended complaint provided "no information suggesting that McCaffree invested in any of the challenged investment options. In fact, the Amended Complaint contains no details as to McCaffree’s specific investments.”
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