>General Motors ERISA
Date Filed: May 13, 2005
Court: U.S. District Court
Location: Michigan
On June 5, 2008, the District Court granted final approval to the Settlement. However, on June 23, 2008, a Notice of Appeal from the Settlement was filed with the United States Court of Appeals from the Sixth Circuit. Under the terms of the Settlement, the Settlement cannot be implemented until the appeal is resolved. That means that the Settlement Fund will not be allocated, and no money from the Settlement fund will be distributed, until the appeal is resolved. It is impossible to predict how long it will take to resolve the appeal, but it could easily take a year or longer. Once the appeal is resolved, Fidelity will begin the process of allocating the net Settlement Fund consistent with the Plan of Allocation.
This site will be updated with further developments as they occur.
CASE DEVELOPMENTS:
January 9, 2008 - We are in negotiation with GM and expect to submit a proposed settlement to the court next week for court review. We are not discussing the terms of the proposed settlement until that time. Please check back then for complete details on January 15.
January 15, 2008 - We are pleased to announce that we have filed a motion for preliminary approval of a proposed Settlement of all claims in In Re General Motors ERISA Litigation. If approved, the Settlement will provide a cash fund of $37.5 million. After the award of attorneys' fees and costs as approved by the Court, the remainder of the fund would be distributed to participants and beneficiaries of the General Motors Savings-Stock Purchase Program for Salaried Employees and the General Motors Personal Savings Plan for Hourly Rate Employees who held GM Stock in their Plan accounts during the period from March 18, 1999 through May 26, 2006. (These particiapnts and beneficiaries are Settlement Class Members). The payments under the Settlement will be made to Settlement Class Members roughly in proportion to the value of their investments in GM stock in one of the Plans during this period.
In addition to the monetary recovery, Settlement Class Members would receive substantial additional benefits under the propsed Settlement, including the following: (1) GM will retain an independent fiduciary to monitor the prudence of offering GM stock as an investment in the Plans, which will mitigate against the risk of large losses in the future (2) GM will not make matching contributions in the form of investment in Company Stock, which should lead to greater diversification in the Salaried Plan; (3) GM will maintain upgraded communications to Plan participants concerning the available investments in the Plans; (4) GM will provide a Savings Plan portfolio tool that enables Plan participants to model various retirement scenarios free of charge for one year; and (5) 'Money in Motion,' a one-year financial advisory program from Ayco Company, will be available to all Plan participants at a reduced cost of $30.
If the Settlement receives preliminary approval, a Court-approved Notice will be mailed to the last known address of all Settlement Class Members. The Court would then schedule a Final Approval Hearing in which it would decide whether or not to grant Final Approval to the proposed Settlement.
June 9, 2008 - We are pleased to announce that on June 5th, United States District Judge Nancy Edmonds granted final approval of GM ERISA settlement agreement. If there is no appeal of the agreement, allocation administrator Fidelity Investments will begin working on implementing the plan of allocation.
There is a 30-day window for parties to file appeals. If there is an appeal, the allocation process will not begin until the appeal is resolved.
We do not know, nor can we predict, how long Fidelity will take to complete the allocation process.
Court: U.S. District Court
Location: Michigan
Hagens Berman Sobol Shapiro was appointed co-lead counsel on behalf of General Motors ERISA plan participants and their beneficiaries. Plaintiffs alleged that General Motors and other plan fiduciaries imprudently managed the plan's assets, causing employee-owners to incur great losses.
The case concerned two General Motors ERISA Plans - the Personal Savings Plan for Hourly Employees and the Savings-Stock Purchased Program for Salaried Employees - both holding large amounts of General Motors stock. Plaintiffs claimed that despite General Motors' financial problems and the companies plummeting shares, GM and plan fiduciaries ignored these troubles, relying on false projections to mask the extent of the company's financial woes.
The plaintiffs also claimed that the defendants should have acted to protect the ERISA plans and its participants from the losses they incurred.
IMPORTANT UPDATE ON STATUS OF SETTLEMENT:On June 5, 2008, the District Court granted final approval to the Settlement. However, on June 23, 2008, a Notice of Appeal from the Settlement was filed with the United States Court of Appeals from the Sixth Circuit. Under the terms of the Settlement, the Settlement cannot be implemented until the appeal is resolved. That means that the Settlement Fund will not be allocated, and no money from the Settlement fund will be distributed, until the appeal is resolved. It is impossible to predict how long it will take to resolve the appeal, but it could easily take a year or longer. Once the appeal is resolved, Fidelity will begin the process of allocating the net Settlement Fund consistent with the Plan of Allocation.
This site will be updated with further developments as they occur.
CASE DEVELOPMENTS:
January 9, 2008 - We are in negotiation with GM and expect to submit a proposed settlement to the court next week for court review. We are not discussing the terms of the proposed settlement until that time. Please check back then for complete details on January 15.
January 15, 2008 - We are pleased to announce that we have filed a motion for preliminary approval of a proposed Settlement of all claims in In Re General Motors ERISA Litigation. If approved, the Settlement will provide a cash fund of $37.5 million. After the award of attorneys' fees and costs as approved by the Court, the remainder of the fund would be distributed to participants and beneficiaries of the General Motors Savings-Stock Purchase Program for Salaried Employees and the General Motors Personal Savings Plan for Hourly Rate Employees who held GM Stock in their Plan accounts during the period from March 18, 1999 through May 26, 2006. (These particiapnts and beneficiaries are Settlement Class Members). The payments under the Settlement will be made to Settlement Class Members roughly in proportion to the value of their investments in GM stock in one of the Plans during this period.
In addition to the monetary recovery, Settlement Class Members would receive substantial additional benefits under the propsed Settlement, including the following: (1) GM will retain an independent fiduciary to monitor the prudence of offering GM stock as an investment in the Plans, which will mitigate against the risk of large losses in the future (2) GM will not make matching contributions in the form of investment in Company Stock, which should lead to greater diversification in the Salaried Plan; (3) GM will maintain upgraded communications to Plan participants concerning the available investments in the Plans; (4) GM will provide a Savings Plan portfolio tool that enables Plan participants to model various retirement scenarios free of charge for one year; and (5) 'Money in Motion,' a one-year financial advisory program from Ayco Company, will be available to all Plan participants at a reduced cost of $30.
If the Settlement receives preliminary approval, a Court-approved Notice will be mailed to the last known address of all Settlement Class Members. The Court would then schedule a Final Approval Hearing in which it would decide whether or not to grant Final Approval to the proposed Settlement.
June 9, 2008 - We are pleased to announce that on June 5th, United States District Judge Nancy Edmonds granted final approval of GM ERISA settlement agreement. If there is no appeal of the agreement, allocation administrator Fidelity Investments will begin working on implementing the plan of allocation.
There is a 30-day window for parties to file appeals. If there is an appeal, the allocation process will not begin until the appeal is resolved.
We do not know, nor can we predict, how long Fidelity will take to complete the allocation process.
Key Attorneys
Andrew M. Volk
Mr. Volk is a partner at Hagens Berman where he has worked since 1996.Recently, Mr. Volk has been working o... link >>
Mr. Volk is a partner at Hagens Berman where he has worked since 1996.Recently, Mr. Volk has been working o... link >>
Steve W. Berman
Mr. Berman co-founded the firm in 1993, and is the managing partner. He is considered one of the most succe... link >>
Mr. Berman co-founded the firm in 1993, and is the managing partner. He is considered one of the most succe... link >>
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