Fremont General Corp. ERISA Litigation
On August 8, 2011, the Honorable Jacqueline H. Nguyen granted final approval of the Stipulation and Agreement of Settlement – ERISA Class Action (“Settlement Agreement”). The Settlement is now final. The distribution of the Net Settlement Fund was made on June 1, 2012. The Settlement Administrator estimates that checks will be sent to Class Members on June 5, 2012.
The Consolidated Complaint was filed in the United States District Court for the Central District of California. This litigation is on behalf of Plaintiffs and a class (the “Class”) of all persons who were participants in or beneficiaries of the Fremont General Corp. and Affiliated Cos. Investment Incentive Plan, and the Fremont General ESOP (collectively the “Plans”), between January 1, 2005, and December 31, 2008 (the “Class Period”) and whose accounts included investments in Fremont General common stock.
In the Consolidated Complaint Plaintiffs allege that during the Class Period, Defendants breached their fiduciary duties to Plaintiffs and the Class by:
- failing to prudently and loyally manage the Plans’ investment in Fremont General stock;
- failing to properly monitor the performance of their fiduciary appointees and remove and replace those whose performance was inadequate;
- failing to provide complete and accurate information to the Class regarding the soundness of Fremont General stock and the prudence of investing and holding retirement contributions in Fremont General equity; and
- failing to prevent breaches by other fiduciaries of their duties of prudent and loyal management, complete and accurate communications, and adequate monitoring.
The Settlement provides for a payment of $21 million, net of expenses described in the Settlement Agreement, for the benefit of the following Class:
All persons, other than Defendants, who were participants in or beneficiaries of the Plans at any time between January 1, 2005 and December 31, 2008, whose accounts included investments in Fremont stock.
At the Fairness Hearing held on August 8, 2011, the Court evaluated Named Plaintiffs’ requests for final approval of the Settlement, for approval of a proposed plan of allocation, for an award of attorneys’ fees and expenses, and for case contribution awards to Named Plaintiffs.
Case and Settlement Documents