The U.S. District Court for the Eastern District of Michigan ordered Ford to pay nearly $1.5 million in attorneys’ fees and costs. However, the settlement called for non-monetary concessions for plan participants. Ford will provide free financial advice for four years to hourly and salaried retirees and employees who invested in Ford stock since April 2000 (see “Ford Settles Company Stock Suit with Advice“).
The company will also warn plan participants whose investments in Ford stock exceed 20% of their total plan holdings that they may want to consider diversifying. Ford also agreed that if it provides a company match to retirement plans during the next three years, the contribution will come in cash, not Ford stock as it has done in the past.
According to BNA, other provisions of the settlement include:
- Fiduciary training for plan fiduciaries at least once a year for four years
- Enhanced communications with plan participants describing the importance of diversification
- During the three-year period following approval of the settlement, when matching contributions are made, participants will first get a chance to select their investments, but if no investments are selected, then the match will be invested in a qualified default investment alternative, which is currently a target date retirement fund.
The case is In re Ford Motor Co. ERISA Litigation, E.D. Mich., No. 06-cv-11718.