Schlichter Bogard Reaches Preliminary $13 Million Settlement on Behalf of University of Pennsylvania Employees

The University of Pennsylvania (“Penn”) has preliminarily agreed to settle an ERISA class action lawsuit brought by Schlichter Bogard & Denton on behalf of participants in the University’s 403(b) retirement plans.

The lawsuit, filed in August 2016, accused Penn of breaching its fiduciary duties under ERISA by, among other things, permitting the plans to charge participants excessive fees and retaining underperforming investments in the plans’ lineups. Additionally, the lawsuit alleged that Penn permitted its recordkeeper to use participant data to cross-sell its financial products.

After over four years of litigation, the parties jointly arrived at a settlement. Its terms include the creation of a $13 million settlement fund for plan participants as well as substantial non-monetary relief, including a requirement that Penn conduct a Request for Proposal for bids on recordkeeping fees, set a fixed fee for administrative services, and prohibit recordkeepers from cross-selling. Additionally, Penn agreed to a three-year monitoring period during which Schlichter Bogard & Denton will monitor compliance.

As Schlichter Bogard & Denton managing partner Jerry Schlichter told Law360, “the settlement will not only provide Penn employees and retirees compensation for the past, but we also expect the Penn employees and retirees will have a significantly improved plan for the long-term future.”

We are proud to have pioneered excessive fee litigation on behalf of retirement plan participants. To read about other high-impact cases handled by Schlichter Bogard & Denton, click here.