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Settlement Reached in ABB Lawsuit

This A motion for preliminary approval of a $55 million settlement was made in this long running class action excessive fee/self-dealing case. The case has been presented in many courts over the years, with an initial ruling in 2012 that ABB owed $21.8 million plus $12.9 million in attorneys’ fees, on the basis that fiduciaries of ABB, Inc.’s 401(k) Plan breached ERISA fiduciary duties to plan participants in their failure to monitor recordkeeping costs and revenue-sharing payments to the Plan’s trust company, negotiate fee rebates to offset or reduce the cost of providing administrative service to plan participants and prudently select and retain investment options in the Plan. Subsequent court rulings vacated the $21.8 million award against ABB with regard to the participants’ investment selection and mapping claims. The mapping claims, in which Wellington Funds were replaced with Fidelity Freedom Funds, were remanded to the trial court, and the $12.9 million in attorney fees was vacated as well.

www.bloomberglaw.com; March 29, 2019.
www.investmentnews; March 20, 2014 (original report source).
PEI Publication: 408(b)(2) Next Steps; March 19, 2019.