The lawyers who negotiated a $28.5 million class settlement with Fidelity Investments over the affiliated funds in its 401(k) plan are entitled to nearly $10.5 million in attorneys’ fees and expenses for their efforts, a Boston federal judge ruled.
Judge William G. Young of the U.S. District Court for the District of Massachusetts approved a fee award of one-third the settlement amount in a two-page order issued Feb. 26. Young also approved nearly $1.5 million in litigation and settlement administration expenses.
The settlement, expected to benefit about 41,000 participants and beneficiaries in Fidelity’s 401(k) plan, resolves a lawsuit accusing Fidelity of filling the $17 billion plan exclusively with Fidelity-affiliated investments that earned fees for the company. It comes nearly one year after Young held that Fidelity breached its duties under the Employee Retirement Income Security Act in managing the plan.
Fidelity is among the dozens of financial companies that have been sued by their employees for including affiliated investment products in their 401(k) plans. Several companies have signed multimillion-dollar settlements, including Reliance Trust Co. ($39.8 million), McKinsey & Co. ($39.5 million), SunTrust Banks Inc. ($29 million), BB&T Corp. ($24 million), and Deutsche Bank ($21.9 million).
Nichols Kaster PLLP and Block & Leviton LLP represent the plan participants. Goodwin Procter LLP represents Fidelity.
The case is Moitoso v. FMR, LLC, D. Mass., No. 1:18-cv-12122, 2/26/21.