A $24 million settlement – including an $8 million attorneys’ fee for plaintiffs’ counsel – has been approved in an excessive fee suit.
Judge Catherine C. Eagles of the U.S. District Court for the Middle District of North Carolina signed the final approval order in the case involving BB&T and a potential class of as many as 67,000 current and former workers. The settlement was announced late last year – just two weeks before the suit was scheduled to go to trial.
Noting that “no class member filed an objection to the proposed settlement,” following a fairness hearing on May 1, 2019, and “after considering the record, the proposed settlement agreement, the supporting memorandum and exhibits, and the statements of counsel during the fairness hearing,” the court found that the settlement was “fair, reasonable, and adequate.”
This particular settlement involved more than just money. It required the BB&T defendants to solicit requests for proposals and hire an independent consultant to evaluate the plan’s investment options and make other recommendations. Under the terms of the agreement, the defendants must also participate in ERISA fiduciary training, which they may pay for out of plan assets (but not the settlement fund), and the defendants were also required to “rebate certain fees to the plan.”
There was, of course, a monetary element as well. Judge Eagles separately approved an award of $8 million in attorneys’ fees for the plaintiffs’ counsel: Nichols Kaster PLLP, Schlichter Bogard & Denton LLP, and Puryear & Lingle PLLC. In reviewing and approving the settlement proposal, Judge Eagles determined that hourly rates of $1,060 for attorneys with more than 25 years of experience to be reasonable.
The plaintiffs who brought the class action will receive $20,000 each under the terms of the settlement, while the plaintiffs’ attorneys will, in addition to the fees noted above, receive reimbursement for “costs incurred of no more than $1,100,000.” The remaining $14.7 million, “less administrative expenses and a contingency reserve, will be distributed to class members in amounts proportional to their average quarterly balance during the Class Period.”
And, spread among as many as 67,000 class members… well, you can do the math.