The parent company of five Massachusetts hospitals has agreed to pay $8.25 million to settle a lawsuit accusing plan executives of mismanaging a 403(b) plan that could affect as many as 100,000 retirement plan participants.
The notice of a preliminary agreement, which requires court approval, was filed April 17 in a U.S. District Court in Boston by attorneys representing plaintiffs in Norton et al. vs. Mass General Brigham et. al.
Former participants sued in January 2022 saying the hospital company violated ERISA by allowing excessive record-keeping fees and failing to monitor investment performance and investment fees. Mass General Brigham’s petition for dismissal was denied in March 2023.
“Defendants denied and continue to deny all of these claims and deny that they ever engaged in any wrongful conduct,” the settlement document said, noting that the agreement was achieved through mediation.
“The costs and risks of litigating this action further favor approval of the settlement,” the document said.
“The history of this case spans over three years, with both parties spending significant costs and time on discovery and motion practice,” the document said. “Without this settlement, the parties would have to incur further expert, travel, court, and other costs that would both delay and reduce any recovery for plaintiffs and the settlement class.”
Mass General Brigham’s hospitals include Massachusetts General Hospital, and Brigham and Women's Hospital.
Consolidated 403(b) Program of Mass General Brigham and Member Organizations, Somerville, Mass., had $12.1 billion in assets as of Sept. 30, 2023, according to the latest Form 5500.
