Wake Forest University Baptist Medical Center will pay $3.8 million to settle a lawsuit filed by 403(b) plan participants who alleged ERISA violations due to high investment costs and high record-keeping fees.
The agreement, which still requires court approval, was announced in a document filed Monday by plaintiffs' attorneys in a U.S. District Court in Winston-Salem, N.C .
The parties agreed to a settlement in principle in May, but they didn't disclose terms at that time in Garnick et al. vs. Wake Forest University Baptist Medical Center et al. Settlement of this class-action case was achieved via mediation, which took place in May.
"Defendants deny all of these claims and deny that they ever engaged in any wrongful conduct," the document said.
The plaintiffs sued in June 2021 and amended their complaint in October 2021. The defendants asked for a dismissal, and U.S. District Court Judge William L. Osteen Jr. rejected the request in September 2022.
The plaintiffs said plan fiduciaries should have offered lower-cost shares of mutual funds in the plan, and they complained that the record-keeping fees were excessive in relation to the services that were provided.
Wake Forest Baptist Medical Center 403(b) Retirement Savings Plan, Winston-Salem, N.C., had $3 billion in assets as of Dec. 31, 2021, according to the latest Form 5500.
