Parties in Lawsuit Against Allina Health System Agree to Settle
The lawsuit accused Allina Health System defendants of allowing one provider free-reign to add funds to Allina's 403(b) and 401(k) plans, and of failing to monitor investment service providers.
Participants in the Allina Health System 403(b) Retirement Savings Plan and 401(k) Retirement Savings Plan have reached an agreement with defendants to settle a lawsuit challenging plan investment decisions, among other things.
The complaint filed in 2017 suggested plan officials ceded discretion to a provider to add any mutual fund it wished, “regardless of whether the funds were duplicative of other options, had high costs, or were performing poorly.” The plaintiffs also claimed their 401(k) and 403(b) plan fiduciaries failed to adequately monitor investment services providers.
Without admitting any liability or wrongdoing, the Allina defendants agree to deposit $2.425 million into a settlement fund. The settlement fund will be used to pay case contribution awards to the named plaintiffs, attorney’s fees and expenses, costs and expenses incurred by the plans’ recordkeeper and the settlement administrator to implement the settlement and proceeds awarded to a class of participants represented by the lawsuit.
The settlement agreement still needs the court’s approval.