ERISA Suit Results in $12M Deal for Allianz Retirement Fund Plan Participants

Facing allegations of imprudent management of workers’ retirement funds, Allianz Asset Management agreed to pay $12 million to settle. According to allegations against the company, they kept everything in the Allianz family of funds excluding all other possibilities from consideration.

U.S. District Judge Staton found the amount offered to plan participants reasonable and granted preliminary approval to the approved deal. The deal was struck at a little over 25% of Allianz’ potential liability in the case. Current and former plan participants allege that the actions of the company were not in the best interest of investors and that the company treated the retirement plan as a way to promote the company’s family of mutual fund businesses while maximizing its own profits. The settlement comes only after close to two years of litigation and a conditional certification of class.

The Defendants did file a motion to dismiss, as well as a motion for summary judgment. While there are other cases that contain similar facts and allegations that ended in favor of the defendants, in this particular case, the court found that factors specific to the case warranted granting preliminary approval. The proposed settlement would be to cover all participants and beneficiaries of the plan since October 7, 2009.

In October 2015, a group of plan participants led by Aleksandr Urakhchin filed a complaint accusing the company of breaching its fiduciary duty to its own investors when they did not consider all available options. Or in other words, by excluding non-Allianz mutual funds, Allianz violated ERISA.

According to the complaint, because the company held onto the funds, plan participants ended up spending millions in excessive fees annually. For instance, in 2013, fees being charged for proprietary funds were about 75% higher than averages for the same time period. This resulted in over $2.5 million in unnecessary, exorbitant fees in 2013 alone. Investors claimed that not only did the company not consider non-Allianz options that may have performed better, but that the Allianz branded-funds chosen often had little or no track record and that frequently underperformed. Even after this became obvious, employees claim the company moved forward with their policy to pour employee retirement funds into Allianz owned investments.

As a part of the agreed upon settlement deal, Allianze will retain an unaffiliated investment consultant to conduct an annual evaluation of the lineup and review the policy statement for at least three years.

If you need to discuss problematic handling of your retirement funds, or other ERISA violations, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

Federal Judge Grants Tens of Thousands of Oracle Corp. Plan Participants Class Certification

On Tuesday, a federal judge out of Colorado granted tens of thousands of Oracle Corp. 401(k) plan participants class certification. The Employee Retirement Income Security Act (ERISA) suit alleges that the tech company piled up excessive record-keeping fees for the plan as well as holding on to funds that were performing poorly.

Plan participants allege Oracle was breached its duties in accordance with ERISA when they piled up tens of millions of dollars of excessive fees and failed in their duty to implement a prudent process for investment funds. The 18-page decision issued by U.S. District Judge Robert E. Blackburn created a class of all plan participants and beneficiaries of the named plan since January 2009. This will include tens of thousands of members. The judge did stipulate that the class will only apply to excessive fee claims since the original proposed class definition was too broad.

Judge Blackburn created two additional classes in connection to the case. One class was designated for plan participants in the Artisan Fund and the other was for plan participants in the TCM fund. Both will have time limitations applied to and will apply to imprudent investment claims. The other fund identified in the suit, PIMCO, did not receive a class certification because there was not a class representative listed.

Counsel for the plaintiffs intend to show at trial that the employees/retirees lost valuable retirement assets due to the excessive fees and poor plan management.

The original suit was filed in early 2016 by a group of plan participants. The group alleged that Oracle and its 401(k) committee breached their fiduciary duties. Allegations also claim that the company breached its duties by engaging in ERISA prohibited transactions and specifically claimed that the company filed to act on behalf of the interests of their plan participants.

According to the suit, Oracle’s record-keeping fees to Fidelity Management Trust Co., the plan trustee, were calculated on a revenue-sharing model that was scaled with the plan’s assets instead of calculating the fees in accordance with the number of participants. Plaintiffs claim that this lack of a fixed fee per participant resulted in significant losses for plan participants due to unreasonable expenses. In the time period between 2009 and 2014, the fund’s assets went from $3.6 billion to over $11 billion. So, while Fidelity revenue saw a drastic increase, the services they provided in exchange remained the same.

When alleging poor plan management and the retaining of poorly performing funds, the suit specifically identified Artisan, PIMCO and TCM, claiming that they caused significant overall losses.

If you have questions or concerns regarding a breach of fiduciary duty under ERISA, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

A Former Walt Disney Employee Accuses the Most Magical Place on Earth of Wrongful Termination

A former Walt Disney employee, Angela Devore, is suing. Allegations include: discrimination, violation of the Family and Medical Leave Act and wrongful termination. She filed the complaint in U.S. District Court for the Central District of California Western Division on January 3rd, 2018. The suit (U.S. District Court for the Central District of California Western Division case number 18-cv-00041) was filed against Walt Disney Imagineering Research & Development Inc. alleging that they violated her rights as an employee to family and medical leave.

The Family and Medical Leave Act or FMLA is a labor law that requires larger employers to provide employees with unpaid leave for serious health conditions, to care for family members who are sick or experiencing serious health conditions, or to care for a newborn or adopted child.

Devore was hired as a set decorator in May of 2014. She was terminated on January 4, 2016.

According to the suit, Devore suffered (and will continue suffering) damages from lost wages, lost bonuses, lost benefits, emotional distress, mental suffering, and other pecuniary loss. Decore alleges that Disney interfered with her right to use her FMLA leave to provide care for her father when he needed assistance with serious health conditions during her time with the company.

Wrongful Termination is a legal term used to describe instances in which an employee’s contract of employment has been terminated by the employer, where the termination breaches one or more terms of the contract of employment, or a statute provision or rule in employment law. In this case, Devore claims she was wrongfully terminated because the FMLA required her employer to allow her to take unpaid leave without discharge. 

Devore claims that the company discriminated against her when they terminated her employment as she tried to exercise her right to take FMLA leave and then refused to reinstate her to her previous position at a later date.

Devore is seeking a trial by jury, economic, non-economic and liquidated damages, interest, declaratory and injunctive relief, attorney fees, etc. all in accordance with what the court deems just.

If you need help handling a wrongful termination or if you are being discrimated against in the workplace, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

Former Employee Files Suit Against Beverly Hills Hotel Alleging Racism

The family that owns the Four Seasons Hotel Los Angeles at Beverly Hills, 300 S. Doheny Drive, is looking at a bit of legal trouble after a former employee filed suit against the wife of the hotel owner. Jennie Lam’s lawsuit claims that she was harassed about her Asian heritage and was then fired in 2016 after she complained about the situation. Lam was employed as a floral designer and plant care specialist at the hotel beginning in February 2015. Her technical employer was For All Seasons Landscapes, which is located inside the hotel.

Defendants included in the lawsuit are: Beverly Cohen, the Robert & Beverly Cohen Family Trust, For All Seasons Gardenscapes Inc., and Veronica Rodriguez. (Veronica Rodriguez is a former co-worker of Lam).

The lawsuit seeks unspecified damages on allegations of race discrimination and harassment, age discrimination (the wife allegedly referred to her as “the little Chinese girl”), whistleblower retaliation, wrongful termination, and intentional infliction of emotional distress. Lam claims she was repeatedly singled out by Cohen due to her race. Allegedly, Cohen once advised Lam, “Chinese, Vietnamese, whatever you are, just work or you will not have a job.”

Lam also claims she was made to work in temperatures over 100 degrees inside a heated greenhouse without the appropriate (or any) rest or meal breaks. When she complained about the working conditions, she was allegedly told that the heat was good for someone her age and good for her skin and that “Asian people are meant to work hard.” Lam’s lawsuit also indicates that she was made to dig through trash cans for old flowers to use in arrangements and also forced to clean the defendant’s penthouse balcony.

Rodriquez is included in the lawsuit because she allegedly made similarly racially charged, negative remarks to Lam such as, “I don’t like you, whatever the hell your background is, Vietnamese or Chinese…”

Lam eventually saw negative effects on her health. In April 2016, she had a panic attack and started to shake when Cohen ordered her to use a saw to cut branches into shorter lengths and use them in a floral arrangement. Lam protested that she wasn’t trained for that type of work, and a co-worker performed the duty. According to Lam, he severely cut one of his fingers during the process. As Lam left Cohen terminated her employment.

If you have been wrongfully terminated or if you are experiencing a hostile work environment, please contact one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

$300 Million Suit Insists Ogletree Law Firm Supports Gender Pay Gap

In recent news, Ogletree Law Firm was accused of gender pay gap in connection with a $300 million lawsuit. The case is all the more interesting because Ogletree Law Firm specializes in defending companies against this type of lawsuit.

How did they end up as a Defendant? It started with Dawn Knepper, California employment lawyer, transferred to the Orange County office in 2012. She requested equal or greater pay in comparison to a male associate with similar seniority whom she had surpassed in both billable hours and new business leads. Rather than agree to her requirement, the firm paid her about $100,000 less than what the male associate was being paid.

This led to one of the claims in Knepper’s l$300 million gender discrimination lawsuit citing Ogletree Deakins as the Defendant. According to Knepper, the firm is male dominated with the majority of decision makers being male and the culture one that fosters the marginalization of women. She also accused the firm of supporting a work culture that demeans and undervalues women.

The website for the firm boasts diversity and equality in their workforce, but Knepper’s suit claims that approximately 80% of equity partners at the firm are men and that the situation means fewer opportunities and lower pay for female associates. She filed her proposed class action complaint against the firm (with more than 700 attorneys throughout the US) was filed on January 12, 2018.

Ogletree insists that they have always kept equal opportunity as a core value at the firm and that they in no way tolerate discrimination of any kind. They also claim that half the firm’s employees are female and that 2 of the 4 elected members of its compensation committee are also women. They went even further to claim that many of their most successful attorneys are women.

If you feel you are being unfairly treated in the workplace, if you are the victim of a gender pay gap or you need assistance obtaining filing a proposed class action lawsuit, please contact an experienced California employment law attorney at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

Does Google Discriminate Against White Male Conservatives?

A former Google Engineer, James Damore, filed a class action lawsuit against Google claiming that they discriminate against white, male, conservatives after he was fired in August. Damore’s firing occurred after he posted a memo to an internal message board at the company presenting a very specific argument:

Damore’s memo argued that women may not be equally represented in tech because they are “biologically less capable” of engineering.

In response to his termination, Damore filed a class action lawsuit against Google in Santa Clara Superior Court. In his suit, Damore claims that Google unfairly discriminates against white men with conservative political views that are not “popular” with Google execs. 

Damore is not making allegations alone either. He is joined by another former Google engineer: David Gudeman. Gudeman spent 3 years working on a query engine for the company. According to his publicly accessible LinkedIn profile, Gudeman left Google in December 2016 and has since been self-employed.

The lawsuit states that it is intended to represent any employees of Google that have been discriminated against as a result of their “perceived conservative political views” by the company or due to their male gender or being a Caucasian. The plaintiffs specifically accuse Google of singling out and systematically mistreating employees that express views that deviate from the popular or “norm” at Google pertaining to various political topics raised in the workplace and/or issues that are relevant to Google’s policies and procedures in relation to employment or business. The lawsuit includes examples, such as: diversity hiring policies, bias sensitivity, social justice, etc.

The men are seeking monetary, non-monetary and punitive remedies.

Google stated that Damore was fired for violating the company code of conduct and promoting negative gender stereotypes in the workplace. The Labor Department is conducting a separate investigation into systemic pay discrimination at Google, but Google denies that there is a problem stating that they have found no pay gap in their own analysis.

If you need assistance filing a California wrongful termination law suit, please get in touch with one of the experienced employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

Whistle-Blower Points the Fraud Finger at Banc of California

Banc of California, Inc. is under investigation by U.S. regulators. The investigation follows a situation in which a short seller linked the institution to an imprisoned con man, alleged inflated profits and a top executive who allegedly supported his stripper habit with company funds. Allegations were detailed in a whistle-blower lawsuit filed by Heather Endresen, a former managing director for the Small Business Administration’s Loan Program.

According to the lawsuit, a decision was made at management level that reversed accrued employee bonuses, which caused Banc of California Inc. to carry over revenues generated in 2016 improperly in order to create a “false” representation of profits for the year. After complaining about the shifting of the pool of bonuses, as well as the inappropriate behavior of the then-CFO, Francisco Turner, Endresen claims she was wrongfully terminated.

According to the complaint filed by Endresen, Turner used company money to pay for strippers as well as engaging in sexual conduct with employees at the office, using drugs at work and putting pressure on lower level employees to join him in his behavior.

Turner declined to comment on the allegations other than to say that there are no claims against him personally and he disputes the allegations made about him. He stated that he would be vindicated through the legal process.

Endresen claims that when she reported the problems, she was told by Banc of California’s legal counsel that the company did not have a policy in place that prohibited employees from engaging in either behavior (engaging in sexual activities in the workplace or using company money to pay for strip clubs). Turner resigned from his position as Banc of California CFO in June in order to pursue other interests. According to the official statement on the matter, Turner’s decision to leave did not relate to any issues regarding the company’s financial reporting, system integrity, etc.

The company insists that the action has no merit and that they will be defending against the claims.

If you have questions regarding wrongful termination or you have been wrongfully terminated from your employment, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.