Expert Analysis and Mediation Assistance in a Breach of Fiduciary Duty Action Under ERISA

The Situation

A securities class action alleging breach of fiduciary duty under the Employee Retirement Income Security Act of 1974 (ERISA) was filed against one of the largest publicly traded companies in the US (by employee count) on behalf of all employees who had invested in one of the company’s employees’ retirement benefits plans. The defendants were alleged to have breached their fiduciary duty by allowing participants in the plans to direct part of their holdings to be invested in company stock.

NERA's Role

NERA examined detailed participant-level data from the company’s defined contribution pension plan administrators, reconciled transactions data with data on plan participant holdings, and prepared a calculation of aggregate losses to plan members under various litigation scenarios and assumptions. NERA also prepared a predicted settlement estimate based on the plaintiff’s demands and other available data. NERA presented its findings to counsel and insurers, and provided assistance to counsel in mediating and settling the matter.

The Result

The matter settled close to NERA’s predicted settlement estimate. NERA subsequently prepared data to be used by the claims administrator in administering the distribution of the settlement.