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Universal Health Services has been accused of mismanaging nearly 70,000 workers’ 401(k) plans, according to a group of employees who are urging a Pennsylvania judge to certify class action status.
Lead plaintiffs, Mary Boley, Kandie Sutter, and Phyllis Johnson, claim that the company offered poor investment options in their retirement package, along with charging excessive fees, and have accused their employer of violating the Employee Retirement Income Security Act (ERISA), according to the class action lawsuit that was filed in June 2020. The workers say that there are nearly $2 billion in assets across the tens of thousands participants.
“Named plaintiffs seek to establish defendants breached their fiduciary duties by continuing to offer inferior investment alternatives and pay excessive recordkeeping fees, which caused the plan and its participants an economic loss,” the motion urging certification of the proposed Class stated on Monday. “As such, each member of the proposed class, just like the named plaintiffs, has a similar interest in recovering losses suffered by the plan as a result of defendants’ conduct.”
The motion also addressed an arbitration clause in the Universal Health 401(k) agreement. Reportedly, the health care company argued for dismissal of the class action lawsuit based on arbitration; however, the plaintiffs say that the terms of arbitration apply to individual claims, not the class-wide allegations in their lawsuit.
In addition, the workers point out in their motion that Universal Health failed to compel arbitration early in the case, effectively waiving any right to the alternative means of dispute resolution.
“There could be no clearer case of waiver,” the court documents state, “The arbitration programs at issue create no impediment to class certification.”
The plaintiffs have accused the health care company of violating its fiduciary duty under ERISA by including inferior high-cost investment options in the plan and charging excessive fees that drained accounts.
Are you participating in a Universal Health 401(k)? We want to hear from you! Tell us about your experience in the comment section below.
The proposed Class Members are represented by Kolin Tang, Laurie Rubinow, Alec Berin, James Miller, James Shah, and Michael Ols of Shepherd Finkelman Miller & Shah LLP and by Gabrielle Kelerchian, Lisa Basial, Mark Gyandoh, and Donald Reavey of Capozzi Adler PC.
The Universal Health 401(k) Class Action Lawsuit is Boley et al. v. Universal Health Services Inc. et al., Case No. 2:20-cv-02644, in the U.S. District Court for the Eastern District of Pennsylvania.
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