Washington University in St. Louis has agreed to pay $7.5 million to settle claims by participants in the university's 403(b) plan that fiduciaries violated their duties under ERISA.
The terms of the settlement, which require court approval, were filed April 15 in a U.S. District Court in St. Louis. The parties announced a tentative agreement Feb. 28 but did not publicize the terms at that time in the case of Davis et al. vs. Washington University in St. Louis et al.
The agreement also contains several non-monetary provisions in which the university:
- Agrees to provide annual fiduciary training for the Washington University Retirement Plan Advisory Committee, one of several university-related defendants.
- Agrees to review the plan's investment policy statement annually.
- Will issue an RFP for record-keeping services within three years after the settlement is approved by the court.
- Will make sure the plan's record keeper(s) do not use participants' personal information for marketing products and services outside of the plan lineup.
The defendants "admit no wrongdoing, fault, or liability with respect to any of the allegations or claims in the class action," the settlement document said. The settlement covers the period of June 8, 2011, to March 31, 2022.
Two groups of participants sued the university and its fiduciaries in June 2017, and their complaints were consolidated into a single lawsuit. They alleged the 403(b) plan's administrative and investment fees were too high and the plan lineup retained certain poorly performing investments.
A U.S. District Court judge dismissed the complaint in September 2018. A federal appeals court in St. Louis, in May 2020, reversed part of that decision, saying the high-fee allegation could go to trial. The parties hired a mediator in January 2022, leading to the Feb. 28 announcement of a tentative settlement.
The Washington University Retirement Savings Plan had $5.87 billion in assets as of Dec. 31, 2020, according to its latest Form 5500 filing.