A federal court judge has preliminarily approved a settlement in a class action against J.C. Penney Corp. over its handling of the company stock fund in its retirement plan.
Under the terms of the settlement, J.C. Penney will pay $4.5 million to resolve allegations that it breached its fiduciary duties under the Employee Retirement Income Security Act (ERISA) by failing to prudently and loyally manage the plan’s assets and to adequately monitor the independent fiduciary and provide the independent fiduciary with accurate information. The lawsuit alleged that plan fiduciaries allegedly knew or should have known that the J. C. Penney Common Stock Fund was an imprudent investment under ERISA.
According to the settlement agreement, defendants deny any and all liability to plaintiffs and the plan, and deny any and all allegations of wrongdoing made in the action. Defendants deny that some or all of them were fiduciaries under ERISA, or were acting as ERISA fiduciaries at the time of the events complained of, or to the extent that any of them were acting as fiduciaries, that any breach of fiduciary duty occurred in connection with the investment, acquisition, or retention of the J. C. Penney Common Stock Fund in the plan. Defendants further contend that they acted prudently and loyally at all times and in all respects with regard to the plan.
The settlement class includes all individuals, excluding defendants, who participated in the plan, and whose individual accounts held units of the J. C. Penney Common Stock Fund between November 1, 2011, and May 31, 2016.