Pentegra Retirement Plan Class Get $38 Million in Jury Trial (1)

A class suing over fees tied to a 401(k) plan administered by Pentegra Retirement Services Inc. was victorious in a rare ERISA jury trial Wednesday and was granted more than $38 million in damages.

The jury answered in the class’ favor and found that Pentegra owed $38,760,232, according to a minute entry in the US District Court for the Southern District of New York.

Nathan Stump, a partner with Schlichter Bogard LLC representing the class, said in a statement Thursday that the verdict represents a hard-fought victory that should be heralded as a “triumph of the American jury system.”

The lawsuit, which covers a class of more than 26,000 people, challenges the fees associated with a $2.1 billion retirement plan the company administers for thousands of employees across hundreds of financial institutions. In 2022, plan participants advanced claims that the plan paid excessive administrative and investment management fees.

The case took a surprising turn in 2023, when Judge Philip M. Halpern of the Southern District of New York ruled that the participants could try the bulk of their case before a jury

Jury trials in cases under the Employee Retirement Income Security Act are rare because many courts have ruled that ERISA lawsuits seek equitable remedies that must be tried by a judge, instead of legal remedies—like money damages—that can be submitted to a jury.

But judges within the Second Circuit—which has jurisdiction over federal courts in New York, Connecticut, and Vermont—have expressed greater willingness to allow jury trials in these cases. Courts in this circuit granted jury trial requests in ERISA cases involving Pentegra, Cornell University, Yale University, and Eversource Energy Service Co.

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, jury verdict 4/23/25.