Pentegra Retirement Plan Settles After Rare Jury Trial Win (1)

Participants that sued over a 401(k) plan administered by Pentegra Retirement Services Inc. reached a settlement Friday, just nine days after their rare ERISA jury trial victory.

Judge Philip M. Halpern stayed all remaining deadlines in the case, pending a formalized settlement, he wrote in an order in the US District Court for the Southern District of New York. A jury answered in the class’ favor that Pentegra owed them more than $38 million.

The lawsuit challenged the fees associated with a $2.1 billion retirement plan the company administers for thousands of employees across hundreds of financial institutions. The case took a surprising turn in 2023 when Halpern ruled that the participants could try the bulk of their case before a jury. Many courts had previously ruled that ERISA lawsuits seek equitable remedies that must be tried by a judge instead of a jury.

Pentegra didn’t immediately responded to a request for comment Friday. Jerry Schlichter, a managing partner with Schlichter Bogard LLC representing the class, didn’t comment on the settlement’s terms, but said they’d be available when the motion for preliminary settlement approval is filed.

Groom Law Group represents the defendants.

The case is Khan v. Bd. of Dirs. of Pentegra Defined Contribution Plan, S.D.N.Y., No. 7:20-cv-07561, order 5/2/25.