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”.
NORTHFIELD, Ill.—Kraft Foods Global Inc. and plaintiffs law firm Schlichter Bogard & Denton L.L.P. have reached a tentative $9.5 million settlement in two lawsuits over management of Kraft's 401(k) plan for its employees and retirees.
According to a joint statement released Friday by the two firms, the two lawsuits in Gerald George et al. vs. Kraft Foods Global Inc. et al., which were proposed class actions, involved whether fiduciaries responsible for overseeing Kraft's 401(k) plan breached their duties under the Employee Retirement Income Security Act of 1974 by allowing the plan to pay excessive investment management and other fees, and by maintaining excessive cash in the company stock investment funds.
According to an April 2011 ruling by the 7th U.S. Circuit Court of Appeals in Chicago, the focus of the litigation were two funds that were among Kraft's 401(k) plan options that invested almost exclusively in the common stock of Kraft and Kraft's then-parent company, Altria Group Inc. Plaintiffs charged that excessive fees were paid to two service providers: recordkeeper Hewitt Associates, since bought by Aon Corp., and trustee State Street Bank & Trust Co.
The joint statement said the defendants disputed the allegations and asserted the plan had been “appropriately managed to offer a menu of sound options for participants' retirement savings. Kraft maintains that it has fully complied with ERISA, which governs such plans.”
Northfield, Ill.-based Kraft had no additional comment, according to a spokesman.
The announcement said both parties determined it was in all parties’ best interest to resolve the litigation. The initial complaint was filed in September 2006 and was scheduled to proceed to trial on various issues in 2012.
The parties filed a motion Thursday for the settlement’s preliminary approval with federal district court in Chicago. An independent fiduciary also must approve the settlement. Once approved, it will be allocated to participant accounts and former participants based generally upon a court-approved formula, after attorney’s fees and settlement administration expense have been deducted, according to the joint statement.
In April 2007, Jerome Schlichter of St. Louis-based Schlichter Bogard identified the Kraft litigation as one of 13 lawsuits related to inadequately monitoring and disclosing 401(k) plan fees and permitting excessive fees that his firm had filed.