Settlement Agreement Reached in Land O’Lakes ERISA Suit

The parties in an Employee Retirement Income Security Act lawsuit filed against the Land O’Lakes dairy company have agreed to settle the litigation.

In July 2021, the U.S. District Court for the District of Minnesota stayed the lawsuit, which was originally filed in May 2020 against Land O’Lakes, the company’s board of directors and various committees tasked with operating the company’s defined contribution retirement plan.

The underlying allegations in the suit are that Land O’Lakes and its officers failed to objectively and adequately review the plan’s investment portfolio with due care to ensure that each investment option was prudent in terms of cost. The suit also alleged the defendants impermissibly maintained certain funds in the plan despite the availability of identical or similar investment options with lower costs and/or better performance histories.

While it admits no wrongdoing in the settlement agreement, Land O’Lakes will pay $1.8 million into a qualified settlement fund that is to be overseen by an independent settlement administrator. These assets, minus attorneys’ fees that are capped at one-third of the overall settlement amount, will be distributed to plan participants and beneficiaries. In exchange for this payment, the class members will forego their right to pursue any related legal claims in the future against the various Land O’Lakes defendants.

Beyond the monetary payment, the settlement agreement includes other stipulations for Land O’Lakes, including that it must complete a request for proposal process related to the plan’s administrative and recordkeeping services and expenses. This is to be done within three years of the settlement date.

The full texts of the settlement agreement and its accompanying orders are available here.