A recent Law 360 story by Emily Brill, “Attorneys Score $20M for Work on ABB 401k Class Action,” reports that the attorneys who represented workers in a 13-year battle with ABB Inc. over excessive 401(k) plan fees will go home with roughly $20 million after securing a $55 million settlement with the technology company. U.S. District Judge Nanette K. Laughrey signed off on the firm’s request for $18.3 million in fees and $2.3 million in expenses, saying the legal team from Schlichter Bogard & Denton LLP secured a “significant” and “substantial” deal for workers in the face of “daunting risk.”
“The outcome of the case was uncertain, sharply contested, often protracted, and required willingness by class counsel to risk unusual resources in time and money,” Judge Laughrey wrote in a memorandum and order. The Schlichter Bogard & Denton team handling the case, which currently consists of Jerome J. Schlichter, Troy A. Doles and Heather Lea, said they put in 28,700 hours of work over more than a decade.
Filed in 2006, the class action accused ABB of using workers' 401(k) savings to offset its expenses and wrongly diverting those savings from one investment fund to another, in violation of the Employee Retirement Income Security Act. Workers won their trial against ABB in 2012, with a Missouri federal judge awarding them $36.9 million, according to court documents. ABB appealed, and the case ping-ponged between the Eighth Circuit and the district court three times before the settlement was reached in March.
Judge Laughrey praised the Schlichter Bogard & Denton attorneys’ “high degree of competence” saying their work had an impact on how corporations handle 401(k) plans. “This kind of litigation has made a ‘national contribution’ in the clarification and refinement of a fiduciary’s responsibilities and duties,” Judge Laughrey said. “Indeed, this litigation not only educated plan administrators throughout the country, it educated the Department of Labor.”