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Compliance January 27, 2011
$5M Settlement for Comcast Stock Drop Case
A federal judge in Pennsylvania approved a
$5-million settlement of a Comcast Corp. stock drop class action suit.
Reported by Fred Schneyer
Chief U.S. District Judge Harvey Bartle III of the Eastern District of Pennsylvania includes a cash settlement to be paid to about 36,000 Comcast workers involved in the suit, as well as requirements that the company make changes in its 401(k) program. Those changes must include:
- investment advisory services to all class members for a period of three years;
- annual diversification notices sent to all plan participants holding more than 10% of their account balance in company stock;
- annual fiduciary training for members of the plan’s investment committee;
- no action to limit plan participants’ ability to sell their Comcast stock for three years.
In April, Bartle certified the suit filed by lead plaintiff Janell T. Moore as a class action. Moore alleged that because the value of company stock was inflated, it was no longer a prudent investment for the 401(k) plan (see “Court Clears Path for Stock Drop Class Action“).