SunTrust Banks Inc. has agreed to pay $29 million to settle complaints by participants in a company 401(k) plan that plan fiduciaries violated their duties under ERISA, according to a preliminary settlement in U.S. District Court in Atlanta.
The preliminary settlement, filed March 11, requires court approval. It covers an administrative complaint filed in 2008, a lawsuit filed in 2011 and two subsequent, similar lawsuits that have been consolidated to form the case — In re SunTrust Banks Inc. 401(K) Plan Affiliated Funds ERISA Litigation — according to the settlement document.
The class-action litigation focused on plaintiffs' arguments that the SunTrust plan fiduciaries violated ERISA by putting eight proprietary SunTrust investments in the plan.
U.S. District Judge Orinda D. Evans in October 2019 rejected SunTrust's request for summary judgment on all eight counts, but Ms. Evans supported SunTrust on five counts. She ordered a trial for the other three counts.
The parties subsequently agreed to mediation, leading to an agreement in principle for settlement.
"Defendants deny all allegations of wrongdoing and deny all liability for the claims in this action," the proposed settlement document said. "Plaintiffs assert that all the claims asserted in this action are meritorious."
SunTrust Banks Inc. 401(k) Plan, Atlanta, had $3 billion in assets as of Dec. 31, 2018, according to the latest Form 5500.