On March 8, 2022, United States District Judge Frank D. Whitney of the Western District of North Carolina approved a $3.5 million settlement of class action claims alleging the Coca-Cola Bottling Company (“Coca-Cola Bottling” or the “Company”) mismanaged its defined contribution retirement plan (the “Plan”). Represented by Miller Shah, two former Coca-Cola Bottling employees (“Plaintiffs”) specifically alleged that the Company mismanaged the Plan by incorporating excessive fees and risky investment options.
Plaintiffs brought suit under the Employee Retirement Income Security Act of 1974 (“ERISA”), a regulatory labor law that establishes standards of prudence and loyalty for retirement and health plan administrators to protect enrolled employees and individuals. Under ERISA, plan administrators, trustees, and investment committees are named as fiduciaries and must act on behalf of plan beneficiaries. Entities subject to ERISA fiduciary responsibilities must act for the exclusive benefit of participants, ensure that the investment options offered through a plan are prudent and diverse, and ensure that plan expenses are fair and reasonable.
Plaintiffs argued that Coca-Cola Bottling breached its ERISA fiduciary duties by failing to disclose the risks and expenses of the Plan’s investment options, retaining poor-performing investments instead of better-performing alternatives, and allowing Plan participants to pay excessive recordkeeping fees that were not representative of true administrative costs. They accordingly brought this class action lawsuit in November 2020 to recover losses incurred from Plan mismanagement and seek appropriate relief for all related classes.
Coca-Cola Bottling denied wrongdoing and moved to dismiss the action on January 14, 2021, citing Plaintiffs’ lack of standing for want of concrete injuries. In March 2021, the Court denied the Company’s motion to dismiss on the grounds that Plaintiffs had sufficiently stated a claim for a knowing breach of trust.
After a series of mediation sessions, both parties worked toward resolving the suit, culminating in the $3.5 million settlement. In granting approval, the Court described the settlement as “fair, reasonable, and adequate, taking into account the costs, risks and delay of litigation, trial, and appeal.” The $3.5 million sum addresses Plaintiffs’ grievances related to the losses incurred from Plan mismanagement. A Fairness hearing is scheduled for August 2, 2022, in order to review the fairness of the settlement and whether the proposed Plan of Allocation should be granted final approval.
Class members can access case-related materials and file a claim at the following link: Coca Cola 401k Settlement – Strategic Claims Services. The case caption is Jones et al v. Coca-Cola Consolidated, Inc. et al., No. 3:20-cv-00654-FDW-DSC, filed in the Western District of North Carolina.
The legal team at Miller Shah LLP has significant experience representing ERISA matters. If you have any questions regarding this subject or this post, please contact Alec Berin (firstname.lastname@example.org) or Jonathan Dilger (email@example.com). The firm can also be reached toll-free at (866) 540-5505.
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