This page provides the answers to class members’ most frequently asked questions.

The information provided is in summary form and is not intended as a complete explanation of your rights. For full and complete information, you are directed to review carefully the Notices.

About The Settlement

What is a Class Action Lawsuit?

A class action is a lawsuit in which one or more plaintiffs (called “Class Representatives”)—in this case, two current Plan participants (the “Named Plaintiffs”)—sue on behalf of a group of people who allegedly have similar claims. After the Parties reached an agreement to settle this case, the Court granted preliminary approval of the Settlement. Among other things, this preliminary approval permits Class Members to voice their support of or opposition to the Settlement before the Court makes a final determination as whether to approve the Settlement. In a class action, the Court resolves the issues for all class members.

What is this lawsuit about?

In the Class Action, the Class Representatives claim that Defendants breached their fiduciary duties and engaged in prohibited transactions to the detriment of the Plan and its participants. The Defendants deny all claims and assert that they have always acted prudently and in the best interests of participants and beneficiaries.

Why is there a Settlement?

The Court has not reached a final decision as to the Class Representatives’ claims. Instead, the Class Representatives and Defendants have agreed to the Settlement. The Settlement is the product of extensive negotiations between the Class Representatives, Defendants, and their counsel. The parties to the Settlement have taken into account the uncertainty and risks of litigation and have concluded that it is desirable to settle on the terms and conditions set forth in the Settlement Agreement. The Class Representatives and Class Counsel believe that the Settlement is best for all Class Members. Nothing in the Settlement Agreement is an admission or concession on Defendants’ part of any fault or liability whatsoever. The Settlement has been entered into to avoid the uncertainty, expense, and burden of additional litigation.

How do I know if I am in the Settlement Class?

The Settlement Class includes all participants and beneficiaries of the NRECA 401(k) Pension Plan at any time from July 25, 2013 through July 31, 2020 excluding members of the Insurance and Financial Services Committee, National Rural Electric Cooperative Association’s (“NRECA”) Board of Directors, and the Plan Administrator.

What does the Settlement provide?

The Settlement will provide, among other things, for a $10 million Settlement fund that will be allocated to eligible Class Members after any Court-approved deductions for Attorneys’ Fees and Costs, Administrative Expenses, and Class Representatives’ Compensation. Class Members with one or more accounts with a positive balance (an “Active Account”) in the Plan as of July 31, 2020 (a/k/a “Current Participants”) will automatically receive allocations directly to their accounts so long as they maintain a positive balance through the time Settlement monies are distributed. Class Members who did not have an Active Account as of July 31, 2020 (a/k/a “Former Participants”) must submit a claim form to be deemed an “Authorized Former Participant” and receive an allocation, and may receive their allocation in the form of a check or a rollover. Current Participants who have an Active Account as of July 31, 2020, but who no longer have an Active Account at the time monies are distributed will be treated as “Authorized Former Participants” and will receive an allocation by check.

How do I get benefits?

Whether you need to submit a claim form to receive your distribution depends on whether you are considered a “Current Participant” or a “Former Participant” Current Participants will automatically receive benefits if the Settlement is Finally Approved by the Court. Former Participants must submit a claim to receive benefits. You may download a claim form here.

How much will my distribution be?

The amount, if any, that will be allocated to you will be based upon records maintained by the Plan’s recordkeeper. Calculations regarding the individual distributions will be performed by the Settlement Administrator, whose determinations will be final and binding, pursuant to the Court-approved Plan of Allocation. There are approximately 93,000 Class Members. To receive a distribution from the Net Settlement Amount, you must either be a (1) “Current Participant” as defined on page 1 of the Notice or (2) an “Authorized Former Participant” (a “Former Participant” as defined on page 1 of the Notice who submitted a completed, satisfactory Former Participant Claim Form by the deadline), or (3) a Beneficiary or Alternate Payee of a person identified in (1) or (2). The Net Settlement Amount will be divided pro rata among Class Members based on each eligible Class Member’s Average Account Balance invested in the Plan during the Class Period. For purposes of making this determination, the Average Account Balance shall be calculated based on the quarter-ending account balance for each Authorized Former Participant and Current Participant for each quarter during the Class Period.

Note that if you are an Alternate Payee pursuant to a Qualified Domestic Relations Order, your portion of the Settlement will be distributed pursuant to the terms of that order. The Net Settlement Amount will also depend on the amount of any Attorneys’ Fees and Costs, Administrative Expenses, and Class Representatives’ Compensation that are awarded by the Court, as these will be paid out of the Gross Settlement Amount of $10,000,000. Class Counsel will file a motion for an award of Attorneys’ Fees and Costs, Administrative Expenses, and Class Representatives’ Compensation at least 30 days prior to the objection deadline. This motion will be considered at the Fairness Hearing. Class Counsel will limit their application for Attorneys’ Fees to no more than one-third of the Gross Settlement Amount ($3,333,333.33). Class Counsel also will seek to recover all actual and anticipated litigation costs and administrative expenses associated with the Settlement. In addition, Class Counsel will seek compensation for the Class Representatives of no more than $10,000 each. The Court will determine the amount of Attorneys’ Fees and Costs, Administrative Expenses, and Class Representatives’ Compensation that will be awarded, if any. All papers filed in this action, including Class Counsel’s motion for Attorneys’ Fees and Costs, Administrative Expenses, and Class Representatives’ Compensation, will be available for review via the Public Access to Court Electronic Records System (PACER), available online at http://www.pacer.gov.

How can I receive my distribution?

Whether you need to submit a claim form to receive your distribution depends on whether you are considered a “Current Participant” or a “Former Participant.” If you are a Current Participant, you do not need to do anything to receive your share of the Settlement. If you are a Former Participant, you must submit a Claim Form to receive a payment. Former Participants should have received a claim form in the mail. Former participants may also download a claim form here.

Can I get out of the Settlement?

No. The Class has been certified for settlement purposes under Federal Rule of Civil Procedure 23(b)(1). Therefore, as a Class Member, you are bound by the Settlement (if it receives final Court approval) and any judgments or orders that are entered in the Class Action.

Can I object?

If you are a Class Member, you can object to the Settlement by mailing a written objection and any supporting documents to Class Counsel and to Defendants’ Counsel, listed below. Class Counsel will respond to your objection in their motion for final approval of the Settlement.

Class Counsel
NICHOLS KASTER, PLLP
Attn: NRECA Plan Settlement
4600 IDS Center
80 South 8th Street
Minneapolis, MN 55402

Defendants’ Counsel
GROOM LAW GROUP, CHARTERED
Attn: Sarah M. Adams
1701 Pennsylvania Ave., NW, Suite 1200
Washington, DC 20006

When and where will the Court hold a hearing on the fairness of the Settlement?

The Court will hold a telephonic Fairness Hearing at 10:00 a.m. ET on December 17, 2020. To call into the hearing, dial 888-808-6929, follow the instructions, and enter access code 1859750 when prompted. Please note that this is a change from what was previously provided on the Class Notice you received in the mail, which listed an address for an in-person hearing. At the Fairness Hearing, the Court will consider whether the Settlement is fair, reasonable, and adequate. The Court also will consider the motion for Attorneys’ Fees and Costs, Administrative Expenses, and Class Representatives’ Compensation. If there are objections, the Court will consider them then. The date and time of the Fairness Hearing are subject to change by Court Order, but any changes will be posted on this website.