On March 9, 2018 plaintiffs and fiduciaries of SunTrust Banks Inc. 401(k) Plan reached a preliminary settlement in this previously reported class action lawsuit. Monetary settlement is currently set at $4.75 million in damages to the plaintiffs. At issue in this case is SunTrust plan executives’ violation of fiduciary duties in managing SunTrust Banks stock within the 401(k) Plan between May 15, 2007 and March 30, 2011. Plaintiffs claim that the SunTrust defendants allowed the Plan to invest in SunTrust stock despite the “artificially inflated” market price due to “material non-disclosed information” concerning SunTrust’s’ weak financial position.
The case, dating back to July 2008, was possibly moving to trial, and it was “an opportune time to attempt” resolution of the claims, according to the preliminary settlement document. In addition to the monetary damages, SunTrust has agreed to a quicker vesting schedule for corporate matching contributions, a provision that must remain effective for at least three years from a court approved settlement.
www.investmentnews.com; March 15, 2018.