A $75 million settlement has been reached to resolve claims that JPMorgan mismanaged employee 401(k) investments.
The settlement will benefit all current and former participants or beneficiaries of ERISA plans who were invested in any JPM Stable Value Fund which in turn invested in the JPM Intermediate Bond Fund and/or the Intermediate Public Bond Fund between Jan. 1, 2009 and Dec. 31, 2010.
There are also three subclasses for the settlement, detailed in the “Who’s Eligible” section below.
The class action lawsuit against JPMorgan argued that the company mismanaged employee retirement plans in violation of the Employee Retirement Income Security Act (ERISA).
The company reportedly invested its stable value funds into two of its other funds: the Intermediate Bond Fund and the Intermediate Public Bond Fund.
These two JPMorgan funds allegedly invested into “risky, highly leveraged assets” including those related to mortgages.
Plaintiffs claim that this was a mismanagement of funds because their retirement assets would have performed better if their funds had been managed correctly and had invested in more reliable assets.
JPMorgan denies any wrongdoing but has agreed to settle the class action lawsuit in order to avoid the costs and risks of continuing litigation through a trial verdict.
Current participants will have allocations made directly to their 401(k) plans. Former participants will be able to receive their allocations in the form of a check. The payment amount will depend on individual amounts invested into a plan.
In order to receive payment, former participants need to file their valid Claim Forms by July 9, 2019. Current participants are not required to submit a Claim Form and will receive payment by doing nothing.
The deadline for exclusion and objection was July 9, 2019. The final approval hearing was scheduled for Sept. 6, 2019.