Neuberger Berman 401(k) Class Counsel Win $4.8 Million in Fees

Neuberger Berman Group employees’ $17 million class settlement in their 401(k) plan challenge received final approval from a Manhattan federal judge, as did their request for $4.8 million in fees and costs for their attorneys.

The deal resolves an Employee Retirement Income Security Act lawsuit covering 1,451 participants in Neuberger’s 401(k) plan who invested in the Value Equity Fund, an actively managed fund that paid fees to a Neuberger subsidiary. The participants claimed the fund, which has since been removed from the plan, performed poorly and charged excessive fees.

Judge Laura Taylor Swain of the U.S. District Court for the Southern District granted final approval to the deal on Tuesday, noting that she’d received no objections from class members. She also approved about $4.8 million in fees and costs—28% of the settlement—for the participants’ attorneys with Bailey & Glasser LLP, saying the fee award is reasonable and “represents a discount compared to the norms in similar litigation.”

Swain initially dismissed the case’s central challenge in 2018 but reinstated the dismissed claim the following year.

Neuberger is among the dozens of financial companies that have been sued over the affiliated funds in their 401(k) plans.

Several have signed multimillion-dollar settlements, including McKinsey & Co. ($39.5 million), SunTrust Banks Inc. ($29 million), Fidelity Investments ($28.5 million), BB&T Corp. ($24 million), and Deutsche Bank ($21.9 million).

Proskauer Rose LLP represents the Neuberger defendants.

The case is Bekker v. Neuberger Berman Group 401k Plan Inv. Comm., 2020 BL 466198, S.D.N.Y., No. 1:16-cv-06123, 12/1/20.