Former AutoZone Inc. employees have reached a preliminary settlement with Northern Trust, which formerly served as the investment adviser of the company's 401(k) plan, in a lawsuit alleging ERISA violations.
The notice of an agreement in principle was filed Oct. 25 in a U.S. District Court in Memphis, Tenn., by attorneys representing the plaintiffs and those representing Northern Trust Corp. and Northern Trust Investments Inc. in the case of Iannone et al vs. AutoZone Inc. et al.
No terms were announced. The settlement document said details will be provided to the court, which must approve the agreement, by Dec. 7.
AutoZone isn't part of the proposed settlement.
Northern Trust was added as a defendant in September 2021 through an amended complaint to the original lawsuit against AutoZone and plan fiduciaries that was filed in November 2019. The lawsuit accused the defendants of allowing "exorbitant management costs" and "hidden trading costs."
AutoZone's request for dismissal was rejected in September 2020 by U.S. District Court Judge Mark S. Norris.
In the amended complaint that included Northern Trust, plaintiffs repeated their ERISA violation allegations, adding that Northern Trust failed to act prudently in reviewing the AutoZone plan's investments and failed to provide sufficient documentation for monitoring the plan's investments and expenses.
The AutoZone Inc. 401(k) Plan, Memphis, Tenn., had $825 million in assets as of Dec. 31, 2022, according to the latest Form 5500.