L Brands Cleared for $2.75 Million Class Deal Over 401(k) Fees

A $2.75 million class settlement between L Brands Inc., the former parent company of Victoria’s Secret, and employees who challenged their 401(k) plan fees and investments received final approval from an Ohio federal court.

The deal resolves allegations that L Brands violated the Employee Retirement Income Security Act by offering expensive investment funds and failing to rein in administrative fees in its workers’ 401(k) plan. It covers more than 67,000 people and represents about 86% of the plaintiffs’ likely damages, according to the settlement motion.

Judge Edmund A. Sargus Jr. of the US District Court for the Southern District of Ohio signed the final approval order Tuesday, after previously allowing the case to advance past the company’s motion to dismiss. Sargus also awarded one-third of the settlement fund to the plaintiffs’ lawyers as attorneys’ fees, along with an $8,750 compensatory award for the named plaintiff.

More than 200 lawsuits challenging 401(k) plan fees have been filed in federal courts since 2019, and dozens have culminated in class-wide settlements. L Brands’ $2.75 million deal is in line with other recent settlements, including those signed by Koch Industries Inc. ($4 million), Michigan’s Bronson Healthcare Group Inc. ($3 million), Teva Pharmaceuticals USA Inc. ($2.55 million), and ManTech International Corp. ($1.2 million).

Goldenberg Schneider LPA and Miller Shah LLP represents the plaintiffs. Morgan, Lewis & Bockius LLP represents L Brands.

The case is Allison v. L Brands, Inc., S.D. Ohio, No. 2:20-cv-06018, 1/31/23.