Law Firm Receives Final Court Approval in $62M Settlement
ST. LOUIS----Schlichter, Bogard & Denton, a leading national law firm based in St. Louis, MO, announced today that it obtained final court approval for its historic $62 million settlement on behalf of Lockheed Martin employees and retirees from Chief U.S. Judge Michael Reagan of the Southern District of Illinois.
“fee reductions attributed to Schlichter, Bogard & Denton’s fee litigation and the Department of Labor’s disclosure regulations approach $2.8 billion in annual savings for American workers and retirees."
The case, Abbott v. Lockheed Martin, alleged excessive fees in two of Lockheed Martin’s 401(k) plans, as well as imprudent management of certain investment options offered to employees.
Jerome Schlichter, Founding and Managing Partner of Schlichter, Bogard & Denton, who led the case for the Lockheed employees, stated: “This settlement achieves powerful benefits for Lockheed Martin employees and retirees not only from the money they will receive but also from valuable improvements in the 401(k) plan for the future, including competitive bidding for services to the plans, state of the art disclosures, lower overall fees, and monitoring by the Court to ensure compliance. This settlement will enhance the employees’ and retirees’ ability to build a meaningful retirement for the future.”
“The settlement is the largest ever for a case of this kind against a single employer,” observed Thomas E. Clark Jr. of the Wagner Law Group.
Judge Reagan stated in the course of the proceeding: The Court also agrees with Mary Ellen Signorille, ERISA senior staff attorney with the AARP Foundation in Washington, D.C., who described the settlement as “an exceptional recovery” for the class that “was only made possible by Schlichter, Bogard & Denton risking tremendous sums of time and money while providing an exceptional level of professional services throughout eight years of litigation.” In this way, Schlichter, Bogard & Denton’s work embodies the finest attributes of a private attorney general, risking significant resources for the good of those saving for their retirement.
Judge Reagan also stated that the firm is “a pioneer and the leader in the field of retirement plan litigation” and that “fee reductions attributed to Schlichter, Bogard & Denton’s fee litigation and the Department of Labor’s disclosure regulations approach $2.8 billion in annual savings for American workers and retirees.”
Plaintiffs alleged that Lockheed Martin breached its fiduciary duties under the Employee Retirement Income Security Act (ERISA). Plaintiffs alleged that the defense contractor imprudently managed and invested plan participants’ retirement savings in funds that charged excessively high fees, diminishing returns. Further, they alleged that Lockheed Martin allowed an unreasonably high level of participants’ retirement assets to be held in low yielding money market funds for State Street Bank & Trust, with whom Lockheed Martin had multiple business relationships. Plaintiffs also alleged excessive fees were charged for recordkeeping services to the Plan.
Lockheed Martin denied all of the allegations and contended it complied in all respects with the law and that the fees were reasonable.
The case was originally scheduled for trial in the Southern District of Illinois last December, but the parties reached an eleventh-hour settlement following extensive negotiations.
Court documents indicate the class includes over 180,000 current and former employees of Lockheed Martin. Lockheed Martin’s plan, with over $27 billion in assets, is the fifth largest 401(k) in the United States.
Mr. Schlichter and his firm also recently won a unanimous 9-0 decision in the United States Supreme Court on behalf of employees and retirees of Edison International in their 401(k) plan, which is the first 401(k) excessive fee case decided by the Supreme Court.
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.
Schlichter, Bogard & Denton, LLP
Jerry Schlichter, 314-621-6115