Gardy & Notis, LLP is co-lead counsel representing members of GE's 401(k) retirement plans suing the managers of the plan for promoting poorly performing proprietary mutual funds as investment options in violation of the Employee Retirement Income Security Act (ERISA).
Plaintiffs alleged that the only actively managed funds in GE's 401(k) plan were proprietary funds managed by GE's wholly owned investment subsidiary General Electric Asset Management (GEAM). These proprietary funds significantly underperformed their benchmarks, yet GE and GEAM failed to replace the funds or offer comparable alternatives. Retaining the underperforming funds allowed GE to prop up the value of GEAM, which it then sold to State Street in July 2016.
After more than five years of litigation, and after the completion of all fact and expert discovery and summary judgment briefing, Gardy & Notis, LLP achieved a $61 million settlement for plan participants, representing the largest ERISA class action recovery ever for alleged improper use of proprietary funds in a 401(k) plan.
On October 17, 2023, Orin Kurtz of Gardy & Notis, LLP presented the settlement to the Court. The Court granted preliminary approval of the settlement on October 20, 2023. The court will hold a final settlement fairness hearing on March 7, 2024.
The case is In re GE ERISA Litigation, No. 17-cv-12123, in the United States District Court for the District of Massachusetts.