Mutual of America Life Insurance Co. has agreed to settle an ERISA lawsuit filed by current and former 401(k) participants who challenged the plan's record-keeping costs and investment lineup.
The preliminary settlement notice was filed March 31 in a U.S. District Court in New York. No terms were revealed. Lawyers for both parties said more details would be available by April 14 in the case of Goldstein et al. vs. Mutual of America Life Insurance Co. The settlement requires court approval.
Plaintiffs sued in September 2022, accusing plan executives of causing high costs by using Mutual's proprietary record-keeping platform and emphasizing its proprietary investment products in the plan lineup.
They said the investments were poor-performers with high fees. "A prudent and objective review of comparable investments in the marketplace would have revealed numerous available investments that were less costly and superior" to the proprietary funds, the lawsuit said.
The Mutual of America Life Insurance Company Savings Plan, New York, had assets of $470.7 million as of Dec. 31, 2021, according to the latest Form 5500.