Duane Morris ERISA Class Action Review – 2024

claims at issue. The court rejected this argument. It found that whether or not all class members were subject to the DRA did not matter because the DRA did not necessarily bind the Plan itself. The court determined that the claims brought on behalf of the Plan were not directly related to the plaintiffs’ employment per the terms of the DRA, but rather concerned the Plan ’ s interests, which were separate and distinct from the individual employment contracts with the defendants. The court found that the plaintiff met the Rule 23 requirements irrespective of the DRA ’ s applicability to some class members, and granted the motion for class certification. In Kernan, et al. v. Metropolitan Life Insurance Co., 2023 U.S. Dist. LEXIS 46871 (S.D.N.Y. Mar. 17, 2023), the Magistrate Judge recommended class certification, but proposed sub-classes to address the fact that only some of the plaintiffs signed a waiver of claims. The plaintiffs, a group of former employees of the defendant, moved to certify a class action alleging that the calculation of benefits offered under their retirement plan (the Plan) violated the ERISA. Specifically, they alleged that the Plan used outdated actuarial assumption when calculating their monthly benefits, thus reducing the amount. The defendants raised two main arguments to challenge standing and class certification, including that: (i) that some of the putative class members signed releases releasing the class claims in connection with the termination of their employment; and (ii) that the plaintiffs’ expert ’ s calculations and assumptions were applied incorrectly and showed that some plaintiffs had suffered an injury when, in fact, they had not. Id. at *13. As to the first argument, the Magistrate Judge ruled that, even if the court were to find that the release covered the class claims, the only effect of that finding would be to reduce the size of the class by a maximum of 464 individuals, and that creating sub-classes was a sufficient solution to the issue. Id. at *16. Further, the Magistrate Judge found that challenges to the methodology of the calculations of the plaintiffs’ expert went to the merits of the case. The Magistrate Judge reasoned that the plaintiffs carried their burden because under the expert ’ s methodology, the named plaintiffs demonstrated some alleged injury-in-fact resulting from the allegation that the annuity choice selected by the proposed class was not actuarially equivalent to the comparator annuity available at the time that they elected their benefits. The Magistrate Judge concluded that the plaintiffs sufficiently identified common questions of law and fact and their claims arose from the same course of events, i.e., the calculation and presentation of the value of the options available to members of the proposed class and their compliance with the ERISA. The Magistrate Judge also ruled that individual adjudications in this case would run the risk that different methodologies and comparators would be used to determine whether the Plan procedure complied with the ERISA, and therefore the class satisfied Rule 23(b) ’ s requirement. Id. at *19. For these reasons, the Magistrate Judge recommended that the plaintiffs’ motion for class certification be granted, with sub-classes created for class members with and without releases. 10. Other Decisions Granting Class Certification Over the past year, defendants also argued class certification should be denied based on differing damages among class members in the absence of a waiver of claims. For example, in Goodman, et al. v. Columbus Regional Healthcare System, 2023 U.S. Dist. LEXIS 134692 (M.D. Ga. Aug. 2, 2023), the court certified a class of retirement fund participants over the defendant ’ s objections. The plaintiffs, a group of participants in a defined contribution plan, filed a class action alleging that the defendant breached its fiduciary duties under the ERISA by failing to prudently monitor and control the Plan ’ s investment options, investment expenses, and administrative expenses. Id. at *1-2. The plaintiffs sought to certify a class consisting of all participants or beneficiaries in the defendant ’ s Retirement Savings Plan with account balances in the Plan as of February 2, 2015 or after through the termination of the Plan. Id. at *9. The plaintiffs specifically alleged that the defendant breached its fiduciary duties by: (i) failing to prudently monitor and control the Plan ’ s investment options, which led to the Plan to offer underperforming and/or expensive investment options; (ii) failing to monitor and control the Plan ’ s administrative expenses; and (iii) by engaging in prohibited transactions under which it paid service providers more than reasonable compensation. Id. at *10. The defendant argued that the class proposed by the plaintiffs was so broad that they did not meet their burden to establish standing, or satisfy Rule 23(a) ’ s commonality and typicality

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