Cumulus Media Workers Approved for $1 Million 401(k) Settlement

Cumulus Media Inc.'s $1 million class settlement with workers challenging their retirement plan fees received final court approval, as did a $333,300 fee award for the workers’ attorneys.

The deal is slated to benefit about 5,230 people covered by the company’s retirement plan since 2014. It represents between 26% and 67% of the range of potential damages, according to the settlement motion.

Judge Thomas W. Thrash Jr. of the US District Court for the Northern District of Georgia signed the final approval order Tuesday. Thrash also approved an attorneys’ fee award of one-third the settlement amount, along with nearly $21,000 in legal expenses.

Cumulus, an audio-focused media company that owns more than 400 radio stations, is accused of filling its $200 million retirement plan with high-cost funds that could have been obtained at a lower price, including “branded” target date funds that carried higher fees than identical options available directly from the provider, and failing to rein in the plan’s annual administrative fees.

The settlement, which was first announced two months after the lawsuit was filed, also resolves an appeal in a similar suit filed against Cumulus by the same attorneys in 2020. Cumulus defeated that case at the district court level by pointing to a release agreement signed by the named plaintiff when he left the company.

More than 200 proposed class actions challenging retirement plan fees have been filed in federal courts since 2020. Cumulus’s $1 million settlement is in line with deals negotiated by other employers, including Bronson Healthcare Group Inc. for $3 million, Beth Israel Deaconess Medical Center Inc. for $2.9 million, Serco Inc. for $1.2 million, Icon Clinical Research LLC for $950,000, and Munson Healthcare for $600,000, among others.

Cumulus is represented by King & Spalding LLP. The plan participants are represented by Capozzi Adler PC and Johnson Fistel LLP.

The case is Dean v. Cumulus Media, Inc., N.D. Ga., No. 1:22-cv-04956, 7/11/23.