United States District Court, M.D. North Carolina
MEMORANDUM OPINION AND ORDER
Catherine C. Eagles, District Judge.
plaintiffs seek court approval of a settlement agreement with
the defendants and dismissal of this ERISA class action with
prejudice. In December 2018, the Court granted preliminary
approval and ordered notice of the settlement be issued to
putative class members. No. class member filed an objection
to the proposed settlement. The Court held a fairness hearing
on May 1, 2019. After considering the record, the proposed
settlement agreement, the supporting memorandum and exhibits,
and the statements of counsel during the fairness hearing,
the Court finds that the settlement has met the requirements
of Rule 23 and is fair, reasonable, and adequate. The motion
will be granted.
September 2015, plaintiff Robert Sims and others sued
BB&T Corporation, its employee benefits plan committee,
board of directors, compensation committee, investment
advisor, and certain employees for violations of the Employee
Retirement Income Security Act of 1974. Doc. 1. In October 2015,
plaintiff Brewster Smith and others filed a similar lawsuit.
Complaint, Smith v. BB&T Corp, No. 1:15-CV-841,
Doc. 1 (M.D. N.C. Oct. 8, 2015). The Court consolidated the
two cases in November 2015. Doc. 33. After motions to dismiss
were resolved, largely but not entirely in the
plaintiffs' favor, see Docs. 58, 150, the Court
certified a class in August 2017 of:
All current and former participants and beneficiaries of the
[Plan] from January 1, 2007 through the date of judgment, who
were injured by the conduct alleged in the Second Amended
Complaint, excluding the Defendants.
Doc. 223 at 2, 12 (alteration in original).
discovery, see Doc. 266, the Court granted in part
and denied in part the defendants' motion for summary
judgment. Doc. 369. Several claims remained for trial. Doc.
369 at 8-9, 13-15, 16-18, 19, 22, 25-26 (denying summary
judgment on claims based on acts or omissions between
September 2009 and September 2012, fees paid to Sterling,
excessive fees and underperforming mutual funds, the Bank
Investment Contract, failure to monitor, certain prohibited
transactions, and a claim for other equitable relief).
parties engaged in ongoing mediation, see Doc. 188;
Doc. 439 at 2, and less than a week before trial, the parties
advised the Court that they reached a settlement of all
claims. Minute Entry 10/25/2018. Class Counsel filed a
consent motion on November 30, 2018, for preliminary approval
of a settlement agreement that would settle all remaining
claims, Doc. 436, which the Court granted. Doc. 439. The
Court also ordered notice to be sent to class members,
setting a deadline for objections of 30 days before the
fairness hearing, i.e., April 1, 2019. Id. at ¶
4. Later, the Court granted a joint motion by the parties to
amend the class action settlement agreement to clearly
exclude the BB&T defendants by amending the Settlement
Class to comprise:
[A]ll persons who participated in the Plan and had an Active
Account at any time during the Class Period, including any
Beneficiary of a deceased person who participated in the Plan
at any time during the Class Period, and/or Alternate Payee,
in the case of a person subject to a Qualified Domestic
Relations Order who participated in the Plan at any time
during the Class Period. Excluded from the Settlement
Class are the BB&T Defendants.
Doc. 443 (emphasis on added text). Class Counsel also filed a
motion for attorney's fees. Doc. 444. No. class members
objected to any aspect of the proposed settlement or to the
motion for attorney's fees.
Counsel filed a consent motion for final approval of the
settlement on April 17, 2019, two weeks before the scheduled
fairness hearing. In support of the motion, Class Counsel
provided a memorandum from Gallagher Fiduciary Advisors, LLC,
the independent fiduciary who reviewed the settlement on
behalf of the BB&T employee retirement plan. Doc. 446-1.
Gallagher concluded, after reviewing the proposed settlement,
documents from the litigation, and interviewing counsel for
the plaintiffs, that the settlement resulted from an
arms-length negotiation and was reasonable. Id.
Counsel also attached to the motion an affidavit from the
project manager at Analytics Consulting LLC, who stated that
Analytics received data for the addresses of 72, 632
Settlement Class Members from the defendants and mailed
notices to these addresses. Doc. 446-2 at ¶¶ 5-6.
Analytics also verified that the Notices and Claims Form were
published on a Settlement website maintained by Class
Counsel. Id. at ¶ 5. Analytics confirmed that
USPS provided 928 updated addresses and returned 2, 802
notices as undeliverable, of which Analytics was able to
locate 2, 119 new addresses through Experian. Id. at
¶ 7. Analytics also maintained a toll-free phone number,
receiving 1, 660 calls and resulting in 33 additional notices
mailed. Id. at ¶ 8. As of April 15, Analytics
had received 9, 032 completed Claim Forms out of 30, 611
former participants. Id. at ¶¶ 6, 9. The
settlement does not require the 42, 021 current Plan
participants to submit a claim form to receive settlement
payments. Id. at ¶ 6; Doc. 436-2 at pp. 19-20
¶¶ 6.5, 6.6.
fairness hearing held on May 1, 2019, Class Counsel stated
the Administrator received a total of 11, 509 claim forms
from former Plan participants by the April 22, 2019,
deadline, which is over one third of the 30, 611 former
participants identified and considered a high percentage in
these matters. While individual recoveries will vary
according to the settlement formula, the average recovery
will be approximately $342. The parties also filed materials
confirming compliance with notice requirements to state and
federal government officials under the Class Action Fairness
Act, 28 U.S.C. § 1715, see Docs. 448, 448-1,
448-2, and an amended attorney's expenses request.
See Docs. 449, 449-1, 449-2. No. class member filed
any objections to the terms of the settlement or the request
for attorneys' fees.
The Proposed ...