Walgreens ERISA Class Action
Case name: Chandra V. Brown-Davis, Yolanda Brown, Ronald Dinkel, et al. v. Walgreen Co., et al.
Case type: Financial Services Litigation
Filed in: [U.S. District Court for the Northern District of Illinois]
On August 9, 2019, Sanford Heisler Sharp filed a Class Action Complaint in the U.S. District Court of Northern Illinois against the Walgreen Co. on behalf of the plaintiffs individually and as representatives of approximately 190,000 participants in Walgreen’s $10 billion 401(k) plan (“Plan”).
The Complaint alleged that Walgreens breached basic fiduciary duties under the Employee Retirement Income Security Act (ERISA) and violated its employees’ trust by mismanaging their retirement funds. According to the Complaint, Walgreens failed to remove from its employee retirement plan a suite of ten target retirement date funds that had significantly underperformed their investment benchmarks and other similar collective investment funds for nearly a decade. The consequences to employees were substantial, the suit alleged.
The Complaint described how employees invested over $3 billion in the company’s Plan, trusting Walgreens to construct a stellar retirement plan. Yet, according to the Complaint, Walgreens failed to prudently monitor the investment performance of the Plan options as required by ERISA. The ten poor-performing target date funds the Plan retained represented almost a third of the Plan’s assets. This chronic underperformance caused the Plan, and hence participants, to suffer staggering losses.
Named as defendants were the Walgreen Co., the Plan’s fiduciary committees, and their members who provide investment advice and services to the Plan.
On February 16, 2022, after two and half years of litigation, the Court granted final approval of a settlement of $13.75 million.