18th Annual Workplace Class Action Report - 2022 Edition

358 Annual Workplace Class Action Litigation Report: 2022 Edition The Court held that the Schlichter Firm had greater attorney resources in the particular practice area to represent the class in this consolidated action. The Court thus concluded that the Schlichter Firm was the more appropriate choice to serve as interim lead class counsel, in light of the number of attorneys dedicated to 401k excessive fee litigation who were committed to work on the matter, and the fact that the Schlichter Firm handled the precatory work in connection with the anticipated motion to dismiss by Defendants. Id . at *8-9. For these reasons, the Court appointed the Schlichter Firm as interim lead counsel in the consolidated action. (xviii) Settlement Approval Issues In ERISA Class Actions Bailey, et al. v. Verso, Case No. 17-CV-332 (S.D. Ohio Feb. 22, 2021). Plaintiffs filed a class action alleging violation of the ERISA and seeking to recover collectively-bargained for life insurance coverage and death benefits for retirees of Defendant’s now closed paper mill. The parties ultimately settlement the matter and the Court granted preliminary settlement approval. The settlement sought to cover all retirees whose life insurance or death benefits were affected by Defendant’s termination of the CBA. Under the settlement terms, all living retirees would be entitled to receive a death benefit of $2,750 for the rest of their lives and beneficiaries or next of kin of a deceased class members would receive a lump sum payout of $3,000. The Court found that the settlement was fair, reasonable, and adequate, resolved a bona fide dispute, would save litigation cost and conserve judicial resources, and was negotiated free of fraud or collusion. The Court further held that the request of class counsel of approximately 20% of the common fund for an attorneys’ fee award was well within the reasonable range. Id . at 7. The Court ruled that the settlement class met the requirements of Rule 23, and granted class certification for settlement purposes. For these reasons, the Court granted the parties’ motion for preliminary settlement approval. D.T., et al. v. NECA/IBEW, 2021 U.S. Dist. LEXIS 195204 (W.D. Wash. Oct. 8, 2021). Plaintiffs, a group of participants in Defendants’ health plan, filed a class action alleging that Defendant denied coverage of medically necessary Applied Behavior Analysis (“ABA”) therapy and Neurodevelopmental Therapies ("NDT") to treat certain mental health conditions that Defendants considered to be "Developmental Delays." Id . at *4. The parties ultimately settled the matter and the Court granted preliminary settlement approval. Following notice to class members, Plaintiffs filed a motion for final settlement approval. The Court thereafter granted the motion. Under the terms of the settlement agreement Defendants would establish a fund of $1.7 million for unreimbursed ABA and NDT services to treat qualifying mental health conditions during the class period as well as alternative health insurance purchased by class members to mitigate their damages. Id . Any remaining funds would be returned to Defendants. Class notices were mailed to 1,890 participants and beneficiaries in the Plan. The Court noted that no class members objected to the agreement, and 129 claims were received for an approximate value of $351,681.46. Id . at *5. The Court concluded that the agreement was fair, reasonable, and in the best interests of the class. The Court determined that the settlement met the requirements of Rule 23(e)(2) and applicable due process requirements. The Court opined that the agreement was the result of arm’s-length bargaining, reached after sufficient discovery and other litigation activity, there was no evidence of collusion between the parties, and the agreement was reached in good faith. Id. at *7-8. The Court further held that the class was provided with adequate notice regarding class members’ eligibility for reimbursement under the agreement. The Court therefore granted the motion for final settlement approval. The Court also granted and award of attorneys’ fees and litigation costs of $850,000 and a service award of $25,000 to the named Plaintiff. Draney, et al. v. Westco Chemicals Inc., 2021 U.S. Dist. LEXIS 182390 (C.D. Cal. Sept. 29, 2021). Plaintiffs, a group of retirement plan beneficiaries, filed a class action alleging that Defendant mismanaged the plans in violation of the ERISA. The parties ultimately settled the matter and filed a motion for preliminary settlement approval. The Court denied the motion. The Court found that the settlement was not fair or reasonable to certain members of the class. Defendant previously had filed a motion for summary judgment alleging that Plaintiffs’ claims were time-barred. Plaintiffs argued that they were alleging that the ERISA violations continued over a period of time rather than just one moment in time, thereby bringing the claims within the statute of limitations period. The Court reasoned that Plaintiffs’ argument was a strong statute of limitations defense such that two subclasses of Plaintiffs, including "a class of employees who were not aware of the plan’s holdings prior to the limitations period and whose claims were not time-barred," and; (ii) those "who were aware, and whose claims were therefore likely time-barred." Id . at *15. The Court determined that because the named Plaintiffs were aware of the plan’s holdings prior to the limitations periods, their claims could be time-barred. The Court