Compliance January 27, 2011

Comcast Stock Drop Case $5M Settlement Gets Court OK

January 27, 2011 (PLANSPONSOR.com) – A federal judge in Pennsylvania has given his stamp of approval to a $5-million settlement of a Comcast Corp. stock drop class action suit.
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The pact okayed by Chief U.S. District Judge Harvey Bartle III of the U.S. District Court for the Eastern District of Pennsylvania not only includes a cash settlement to be paid out to about 36,000 Comcast workers involved in the suit, but calls for the company to make changes in its 401(k) program, including:

  • provide investment advisory services to all class members for a period of three years;
  • send annual diversification notices to all plan participants holding more than 10% of their account balance in company stock;
  • provide annual fiduciary training for members of the plan’s investment committee; and
  • take no action to limit plan participants’ ability to sell their Comcast stock for three years.

In April, Bartle certified the suit filed by lead plaintiff Janell T. Moore as a class action. Moore alleged that because the value of company stock was inflated, it was no longer a prudent investment for the 401(k) plan (see Court Clears Path for Stock Drop Class Action). 

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