Notable Cases

Erisa Investment Class Action

Farm Industrial and Supply Co. v. First Mercantile Trust et al, Case No. 02-cv-2649- M/A (W.D. Tenn. Dec. 3. 2003)

This class action involved allegations that over 2,500 ERISA 401(k) plans had been charged significant, undisclosed management fees by First Mercantile Trust (“FMT”), a fund to fund manager of qualified employee investment plans.  Our investigation revealed that FMT had added over 150 basis points to its management fees, fees which its plan documents and marketing materials never disclosed. More importantly, we discovered that FMT had taken substantial steps to keep these fees hidden from its investment plan clients, including efforts to keep its funds managers and employees silent as to these secret fees.  Following the filing of our client’s class action suit for violations of ERISA and RICO, FMT even attempted to scuttle the case by obtaining a written “ratification” of the undisclosed fees by the absent class members.  Despite this under handed effort (which failed to mention our client’s suit and failed to disclose the nature and amount of the fees taken), FMT agreed to a $19 million cash settlement on behalf of this nationwide class.