Puerto Rican Bank Settles Stock Drop Case

July 15, 2011 (PLANSPONSOR.com) - Gainey & McKenna and Harwood Feffer LLP, plaintiffs’ Co-Lead Counsel, and Popular, Inc. announce that a Settlement has been preliminarily approved by the U.S. District Court for the District of Puerto Rico in the consolidated class action lawsuit, In re Popular Inc. ERISA Litigation.

The settlement will provide for a payment of $8.2 million to the plans (minus court-approved fees and expenses), which will then be allocated to the accounts of participants of the plans who had portions of their accounts invested in Employer Stock in the Employer Stock Fund during the Class Period.  

According to the announcement, the Settlement Class consists of all participants of the Popular, Inc. Puerto Rico Savings and Investment Plan and the Popular, Inc. U.S.A. 401(k) Savings & Investment Plan who held Employer Stock, as that term is defined in the plans, in their individual accounts in the plans at any time during the period starting on January 24, 2008, and ending on April 6, 2011.  

A hearing is set for August 26 for final approval of the settlement.  

In May 2009, the Milberg class action law firm announced it was investigating possible violations of the Employee Retirement Income Security Act (ERISA) in its handling of the Popular, Inc. U.S.A. 401(K) Savings & Investment Plan by keeping company stock as a 401(k) plan investment option when it was no longer prudent to do so and by not fully disclosing its true financial condition to participants (see Milberg Announces Puerto Rican Bank ERISA Probe).