BlackRock 401(k) Fund Class Action Settles for $9.7 Million

BlackRock Institutional Trust Co. will pay $9.65 million to settle a class action challenging the in-house funds in its employees’ 401(k) plan, the employees told a federal judge in the Northern District of California.

The deal, announced in court papers filed Tuesday, is expected to benefit about 17,000 people covered by BlackRock’s $1.8 billion retirement plan. The settlement amount represents nearly one-third of the class members’ potential damages in the case, according to the filing.

The lawsuit accuses BlackRock—the world’s largest asset management company—of taking unreasonable profits from the collective investment trusts it offers to retirement plans, including the plan ...