Help

BI’s Article search uses Boolean search capabilities. If you are not familiar with these principles, here are some quick tips.

To search specifically for more than one word, put the search term in quotation marks. For example, “workers compensation”. This will limit your search to that combination of words.

To search for a combination of terms, use quotations and the & symbol. For example, “hurricane” & “loss”.

Login Register Subscribe

Marsh unit Mercer to pay $500M to settle Alaska pension suit

Reprints

JUNEAU, Alaska (Bloomberg)—Marsh & McLennan Cos. Inc.'s Mercer L.L.C. consulting unit agreed to pay $500 million to settle a lawsuit brought by the Alaska Retirement Management Board that blamed the firm for billions in unfunded liabilities.

The settlement was in the company's best interests because of the uncertainty of the outcome of a jury trial in Juneau, Alaska, where many plan participants live and because the plaintiffs were seeking at least $2.8 billion in damages, Mercer said in a statement. A spokesman declined to comment further.

Alaska Attorney General Dan Sullivan said in a separate statement that the unfunded liabilities were caused by stock market declines, increases in health care costs and Mercer's negligence. The Alaska board accused Mercer of malpractice, breach of contract and unfair trade practices in advising the state on management of two retirement funds.

“This is a significant settlement that will benefit the state and our citizens,” Mr. Sullivan said in the statement. “We have been informed that by a large margin it is the largest such settlement in history for this kind of claim.”

Mercer denied liability, it said in its statement. Insurance will cover $100 million of the settlement, the company said.

The case is Alaska Retirement Management Board vs. Mercer, 1JU-07-0974, Alaska Superior Court (Juneau).