ST. LOUIS--(BUSINESS WIRE)--Schlichter, Bogard & Denton, a leading national law firm based in St. Louis, MO, announced today that its $27.5 million settlement, on behalf of Ameriprise employees and retirees in the 401(k) excessive fee case, Krueger v. Ameriprise Financial, has been approved by the Court.
“We are pleased that the settlement, achieved on behalf of Ameriprise employees and retirees, is approved,” said Jerome Schlichter, Founding and Managing Partner at Schlichter, Bogard & Denton. “The financial terms reached and non-monetary relief obtained will benefit current and future Ameriprise employees and retirees. They will be able to build and enhance their retirement savings in the future.”
Mike Alfred, Co-founder and CEO of BrightScope, an independent firm that provides data about retirement plans, has previously commented that Schlichter, Bogard & Denton has had a “humongous” impact on reducing fees in the entire 401(k) industry.
An estimated 46,200 current and former Ameriprise employees are members of the class in this action and have received a Settlement Notice in the mail. Schlichter, Bogard & Denton originally filed the complaint over three and a half years ago and committed more than 28,000 hours of attorney time to secure the settlement for Ameriprise employees and retirees.
The parties filed a joint motion for approval of the settlement on March 20, 2015 with Judge Susan Richard Nelson of the United States District Court for the District of Minnesota, who approved the settlement. The settlement’s non-monetary relief provisions, some of which have already been adopted by Ameriprise, enhance the Ameriprise 401(k) plan and set the standard for best practices for corporate plan sponsors.
Originally filed on September 28, 2011, the plaintiffs alleged that Ameriprise breached its fiduciary duties under the Employee Retirement Income Security Act (ERISA), by failing to ensure that the recordkeeping and management fees and expenses paid out of the assets in the plan were reasonable. Additionally, they alleged that the plan’s fiduciaries breached their fiduciary duties in selecting and retaining proprietary investment options.
Ameriprise denied all of the allegations, and contended that the fees were reasonable. It also contended that it complied in all respects with the law and did not commit any fiduciary breaches.
In the settlement, Ameriprise has agreed to terms designed to strengthen and add value to its 401(k) plan as part of the non-monetary relief provisions. Under the provisions, Ameriprise has agreed to conduct a request for proposal competitive bidding process for recordkeeping and investment consulting services; will pay flat fees to the plan recordkeeper or on a per participant basis; and limits in compensation for administrative services provided to the plan and other reimbursement of expenses from the plan. Ameriprise must provide participant statements that comply with all applicable Department of Labor regulations; and consider the use of less expensive collective investment trusts or separately managed accounts. The Court will retain jurisdiction to monitor compliance for three years.
About Schlichter, Bogard & Denton, LLP
Schlichter, Bogard & Denton, LLP, of St. Louis is a national law firm that represents individuals, including victims of financial abuse and 401(k) plan investors, whose plans suffer from excessive fees or imprudent investment options. It currently is representing employees of Edison International, Massachusetts Mutual, Northrop Grumman, and others in claims of excessive fees in 401(k) plans. Its attorneys are dedicated to helping financial abuse victims, and helping employees and retirees secure the retirement benefits they deserve.