T. Rowe Price has agreed to pay $7 million to resolve claims that he violated the Employees Retirement Income Security Act of 1974 (ERISA) by mismanaging his employee pension plan.
The settlement benefits participants and beneficiaries of the T. Rowe Price U.S. Retirement Plan who had a balance in their account between February 14, 2011 and January 18, 2022. The balances must have been in one of 39 specific funds. A full list is available on the settlement website.
T price. Rowe is an investment management company that manages $1.68 trillion in assets. According to the company’s website, T. Rowe Price employs more than 800 investment professionals worldwide.
Despite his expertise in investment management, T. Rowe Price allegedly mismanaged his own employees’ retirement fund.
According to the retirement class action lawsuit, T. Rowe Price invested the employees’ retirement savings only in his own funds. These investments enriched T. Rowe Price through the high fees associated with proprietary funds, the plaintiffs claim.
Plan participants argue that T. Rowe Price breached its fiduciary duties under ERISA by investing in its own equity instead of better-performing funds with lower fees. Plaintiffs say they are entitled to financial compensation for “T. Rowe Price’s corporate self-sealing to the detriment of company employees’ retirement savings.”
T. Rowe Price has not admitted any liability in the case, but has agreed to resolve the plan participants’ allegations with a $7 million class action settlement.
Under the terms of the settlement, class members can collect payment. Payouts will be at least $20, but exact amounts will vary depending on how much each class member has invested in T. Rowe Price’s retirement funds.
Former plan members will receive their payment in the form of a check, while current plan members will have their payment applied to their retirement plan account.
In addition to providing payments, the settlement provides non-monetary benefits. T. Rowe Price has agreed to add a brokerage window feature to its retirement plan to provide participants with greater investment options.
Class members do not have the ability to opt out of this settlement. Because the complaint has been certified as a class action, class members are bound by the terms of the settlement.
The opposition deadline is April 26, 2022.
The final settlement approval hearing is scheduled for May 24, 2022.
No claim form is required to benefit from the settlement. Class members will automatically receive a cash payment of the settlement after final approval.