Danielle Toth  |  October 27, 2021

Category: 401k

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Walgreens, 401K & Class Action Settlement
(Photo Credit: Scott Heaney/Shutterstock)

Walgreens 401k Class Action Lawsuit Overview: 

  • Who: Chandra Brown-Davis filed a class action lawsuit against Walgreen Co.
  • Why: The plaintiff alleges Walgreens steered workers’ retirement savings into poorly performing mutual funds.
  • Where: The class action lawsuit was filed in Illinois federal court.

Current and former Walgreens employees have asked an Illinois judge to approve a $13.75 million settlement in a class action lawsuit regarding a poorly performing retirement plan.

Under the terms, the defendants will pay $13,750,000 into a settlement fund, which will be allocated among Class Members in proportion to their ownership in the challenged funds. In addition, the defendants have agreed to remove the mutual funds, named the Northern Trust Focus Target Retirement Trusts, from the plan. The defendants have agreed to use an investment adviser to provide ongoing monitoring services for the plan.

“The proposed settlement easily satisfies the criteria for preliminary approval. The Court should grant this motion, enter the attached proposed order and direct notice to the class so that class members have an opportunity to weigh in on the fairness, reasonableness and adequacy of the settlement. Then, the court may proceed to consider whether the settlement should receive final approval,” the motion states.

Walgreens Failed in Its Oversight of Funds Offered in Retirement Plan

Walgreens steered its workers’ retirement savings into funds that performed worse than 70 to 90 percent of similar funds for nearly a decade, costing workers $300 million, the lawsuit alleges. 

The proposed Class is made up of approximately 240,000 people, most of which are current and former Walgreens employees.

The workers’ complaint was brought in August 2019 and covers participants in the Walgreens Profit-Sharing Retirement Plan and its beneficiaries who were invested in certain Northern Trust target-date funds offered in the plan since Jan. 1, 2014. 

Walgreens added the funds in 2013, even though the funds already had a poor track record in the previous three years, the lawsuit alleges. Workers claim the funds performed up to 90 percent worse than similar retirement plans.

Despite the fund’s poor performance, the pharmacy chain added even more Northern Trust funds to its offering in 2017 and made them the default investment option, the class action contends.

Are you a current or previous Walgreens employee who has participated in a company 401(k) fund? Share your experience in the comments below.

The class is represented by Charles Field, Kevin Sharp, David Tracey, and Danielle Fuschetti of Sanford Heisler Sharp LLP.

The Walgreens 401(k) Class Action Lawsuit is Brown-Davis et al. v. Walgreen Co. et al., Case No. 1:19-cv-05392, in the U.S. District Court for the Northern District of Illinois.


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10 thoughts onWalgreens Workers Ask Judge To Approve Nearly $14M Settlement Over Retirement Plan

  1. Christine says:

    I worked for Walgreens from 2006 until they shut the Logan township warehouse in NJ in 2017.

  2. Monquie says:

    So who really benefits from these types of ‘class action “ lawsuit come correct Who really Benefits from these lawsuits

    1. ZAHRA baberi says:

      lawyers

  3. Mimi says:

    The settlement will not be divided equally. The amount received by each class member will be according to the amount they personally invested in the underperforming funds and the estimated percentage points the specific fund was determined to have lost over the course of the investment. Some people were contributing from 2012 to present while others participated shorter periods. So some participants will receive larger settlements than others.

  4. Sharon D Summersett says:

    I have been and still are a member of Walgreens. I’ve been working 2007- and I’m still there invested in the 401k .

    1. Mimi says:

      Same. I was there 2006 until earlier this year. Thankfully the NTF Target funds have only been offered since 2012. I really miss the VIP funds. I always used those as my Christmas funds.

  5. Shane Jeremich says:

    So $13,750,000 minus $4,583,333.33 for attorney’s fees and costs (to not exceed 33 1/3% of the total value) equals $9,166,666.67, divided by approximately 240,000 people comes to a whopping…. $38.19. I think farce is an understatement!!!

  6. Al says:

    This settlement is a farce! $300,000,000 in lost retirement earnings, and a settlement of $13,000,000. After the lawyers are paid, the employees who suffered under this program will get less than $50 each. God bless America!

  7. Shirley Henderson says:

    Add me

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