Workers’ Attys Get $25M In Fees From JPMorgan ERISA Deal
A New York federal judge has given the final green light to a $75 million settlement resolving an Employee Retirement Income Security Act class action over JPMorgan Chase & Co.’s management of investments from participants in third-party 401(k) plans, signing off on the participants’ bid for $25 million in attorney fees.
In his two orders Monday, U.S. District Judge Vernon S. Broderick granted his final approval to the deal struck between JPMorgan and the class of third-party 401(k) plan participants and awarded the class counsel $25 million in attorney fees and nearly $1.5 million in costs. The settlement was “fair, reasonable and adequate,” the judge found, dismissing with prejudice objections from three individuals.
Judge Broderick was also unpersuaded by two objections lodged against the attorney fees in the settlement. The judge found one objection taking issue with certain costs being imposed on the class to be unavailing because courts weren’t allowed to “pick and choose the terms of the settlement they may desire to have modified.”
And another objection regarding the size of the award failed to take into account the 26,952 hours the firms spent working on the case, the judge said. While the objector looked at the class counsel’s out-of-pocket costs to conclude that the $25 million represented a 1429% profit, the firms’ $17.6 million lodestar showed they only sought a “modest multiplier” of 1.4, the judge held.
Judge Broderick also concluded that the $20,000 service awards to the 12 class representatives in the case were reasonable as well.
The dispute stems from a proposed class action filed against JPMorgan and affiliates in April 2012 that received certification in March 2017. In their case, the participants alleged that JPMorgan wrongly had its stable value funds invest heavily in funds that themselves were invested in “excessively risky, highly-leveraged assets.”
The parties first proposed the settlement, which faced objections, to the court in November 2017, and Judge Broderick preliminarily approved the agreement in January 2018, with exception to its notice provisions. Amendments were made to those provisions, and the judge signed off on the agreement again in March.
Counsel and representatives for JPMorgan didn’t respond Tuesday to requests for comment.
The plaintiffs were represented by Joseph Peiffer and Daniel J. Carr of Peiffer Wolf Carr & Kane, as well as attorneys from various additional law firms.
JPMorgan was represented by Jeremy P. Blumenfeld of Morgan Lewis & Bockius LLP as of August 2018.
The case is In re J.P. Morgan Stable Value Fund ERISA Litigation, case number 1:12-cv-02548, in the U.S. District Court for the Southern District of New York.
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