Centerra LLC and its investment manager, Aon, have agreed to pay $7.5 million to settle a complex ERISA lawsuit by current and former employees.
Attorneys for plaintiffs and defendants filed a settlement document Feb. 2 in a U.S. District Court in Columbia, S.C., describing the agreement's terms, which require court approval. The parties reached an agreement-in-principle on Jan. 12 with the aid of a mediator in the case of Williams et al. vs. Centerra Group LLC et al.
The company, its fiduciaries and its investment manager, Aon, are defendants. Aon will pay $4.5 million; Centerra will pay $3.0 million.
The plaintiffs sued in December 2020, arguing the Centerra 401(k) plan's use of a target-date series offered by Aon, formerly known as Aon Hewitt Investment Consulting, was worse than the target-date series it replaced. Plaintiffs said actions by the defendants breached their fiduciary duties and represented prohibited transactions under ERISA.
"Defendants admit no wrongdoing or liability with respect to any of the allegations or claims in this action," the settlement document said. "Defendants maintain that they are without fault or liability and are settling the class action solely to avoid litigation costs."
The plaintiffs and Aon had reached an October settlement in which Aon would pay $4.5 million, but Centerra asked a federal judge in November to prevent the deal because it would "improperly and unfairly impair the Centerra defendants' rights."
On Jan. 5, U.S. District Court Judge Sherri A. Lydon rejected this settlement, saying it was "prejudicial" to Centerra and its fiduciaries.
Centerra, which provides security services, is a subsidiary of Constellis, Herndon, Va.