Aspirus Inc. agreed to pay $1.5 million to settle allegations that the operator of hospitals and other health-care facilities and its fiduciaries violated ERISA in managing a 403(b) plan.
The settlement also requires the defendants to conduct an RFP within two years of the settlement taking effect, said the Aug. 12 agreement in Traczyk vs. Aspirus Inc. et al. filed in a U.S. District Court in Grand Rapids, Mich. The settlement covers participants in the plan since Jan. 1, 2018, through the preliminary court approval of the settlement.
An Aspirus employee filed the lawsuit in April 2021 alleging, among other things, that the plan charged "unreasonably" high record-keeping fees and offered certain investment options that were more expensive than similar or identical products in the marketplace.
The defendants subsequently filed a motion to dismiss, which was rejected in December 2021. In June 2022, the parties began discussing the complaint with a mediator.
Although the defendants support the settlement terms, they "do not agree with the averments, statements, allegations, and claims stated by plaintiffs," said the settlement document, which was submitted to the court by the plaintiff's attorneys.
"At a minimum, continuing the litigation would have resulted in complex and costly proceedings, and significantly delayed any relief to the class," the plaintiff's attorneys wrote in describing the reasons for the settlement. "ERISA cases such as this can extend up to a decade before final resolution, sometimes going through multiple appeals."
The Aspirus Inc. Retirement Plan, Wausau, Wis., had $633 million in assets as of Dec. 31, 2020, according to the latest Form 5500.
