Columbus Regional Healthcare System, Inc., a Georgia company, and a class of some 6,800 retirement plan participants, recently advised a federal district court that they have reached a $2 million settlement in their pending Employee Retirement Income Security Act (ERISA) case. The parties' joint filing detailed the settlement terms, which would end the plan participants' class action lawsuit in which they accused plan sponsors of losing them millions in retirement funds by charging them excessive administration fees and offering them poor investment choices.
Plan participants filed the original suit in February 2021. The case is Goodman et al. v. Columbus Regional Healthcare System Inc., Case number 4:21-cv-00015, U.S. District Court for the Middle District of Georgia. Piedmont Healthcare Inc., an Atlanta-based company, acquired Columbus in May 2019, at which point the retirement plan already had lost about $4.6 million in assets. The plan participants claimed that the plan was full of overpriced, poorly performing funds and excessive fees and expenses.
U.S. District Court Judge Clay D. Land denied the healthcare system's motion to dismiss on January 25, 2022, based on the U.S. Supreme Court's decision in Hughes et al. v. Northwestern University. In Hughes, the Supreme Court held that an employer may breach its fiduciary duty under ERISA to plan participants even when it provides a range of investment options. In August 2023, the judge granted class certification to all plan participants and beneficiaries who invested in the plan between February 2015 and the plan's termination, overruling the healthcare system's objections to the proposed class as overly broad.
The case is scheduled for final settlement approval on June 12, 2024.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
