Caterpillar 401(k) Class Action Settlement

A federal district court has granted final approval of a class action lawsuit settlement involving Caterpillar, Inc. and participants in the company’s four 401(k) plans. Caterpillar will pay $16.5 million to settle the 4-year-old lawsuit, which was given tentative approval last November.

According to the class action lawsuit, Caterpillar employees and retirees paid excessive fees in order to remain invested in the company’s four 401(k) plans. The lawsuit alleged Caterpillar breached its duties under ERISA by allowing the plans to pay excessive investment management and other fees because it maintained excessive cash in the company stock investment fund, and because it offered the Preferred Group of Mutual Funds as plan investment options between 1992 and 2006, which were advised by a wholly-owned Caterpillar subsidiary. In 2006, before the class action lawsuit was filed, Caterpillar exited the investment management business, which resulted in the Preferred Funds being replaced with other investment options, including separate accounts.

The class action lawsuit included two classes: those who are current plan participants and those who are former plan participants. The claims period for former plan participants has expired, but current plan participants are automatically included in the class action lawsuit settlement.

If you had an account in one or more of the following plans — the Caterpillar 401(k) Plan, Caterpillar inc. Tax Deferred Savings Plan, Caterpillar Inc. Tax Deferred Retirement Plan, or the Solar Turbines Savings and Investment Plan — at any time between July 1, 1992 and September 10, 2009, you’re entitled to a portion of the settlement.

If you had an active account in one or more plans on September 10, 2009, then any amount you’re entitled to will be deposited into your Plan account. If you no longer have a Plan account as of the date of your settlement or have reduced your account balance to $0, you will receive your settlement distribution in the form of a check mailed to your last known address.

More information on the Caterpillar ERISA Class Action Lawsuit Settlement can be found in the settlement notice.