Baird v. BlackRock Institutional Trust Company, N.A.

Background

The plaintiffs challenged the defendants’ management of the BlackRock Retirement Savings Plan. The court had certified a class consisting of current and former participants in that plan, but had not certified a separate proposed class involving participants in other retirement plans invested in certain BlackRock collective trust investment vehicles. After more than four years of litigation, including discovery, expert work, and competing summary-judgment motions that the court denied, the parties reached a settlement shortly before trial.

Settlement Terms

The settlement resolves the claims of the certified BlackRock Plan Class only. The class includes all participants and beneficiaries in the BlackRock Retirement Savings Plan during the period from April 5, 2011, through July 12, 2021. Defendants will pay $9,650,000 into a settlement fund. After approved fees, expenses, service awards, and administrative expenses are deducted, the remaining money will be distributed in proportion to the value of each class member’s account allocations to BlackRock-managed investments during the class period.

Current participants generally will have their shares credited to their plan accounts, while former participants generally will receive checks without having to submit claim forms. The release covers claims asserted in the action or related to the selection, oversight, retention, or performance of the plan’s investment options and service providers, as well as related fees, expenses, and disclosures. The agreement preserves certain claims, including unrelated wage and employment claims, individual benefit-denial claims outside the release, claims belonging to the non-certified proposed class, and claims based exclusively on later conduct.

Final Settlement Approval

Under Federal Rule of Civil Procedure 23, a court may approve a class settlement only after notice and a hearing, and only if the settlement is fair, reasonable, and adequate. The court found that notice reached 99.6% of class members and complied with the applicable requirements. It also considered the risks and expense of continued litigation, the settlement amount, the extensive discovery, the possibility of challenges to class certification, counsel’s experience, and the absence of objections or requests for exclusion.

The court concluded that the settlement was fair, adequate, and reasonable. It therefore granted the motion for final approval of the class action settlement.

Fees, Costs, and Service Awards

Class Counsel requested $2,798,500 in attorneys’ fees, $641,557.58 in litigation expenses, and $15,000 service awards for each of the two named plaintiffs. The requested fee was approximately 29% of the settlement fund, above the 25% benchmark commonly used in common-fund cases. The court found the higher percentage justified by the substantial recovery, the case’s complexity, the extensive litigation, the contingent nature of the representation, and counsel’s experience. A lodestar cross-check—hours reasonably worked multiplied by reasonable hourly rates—also supported the fee request.

The court granted attorneys’ fees of $2,798,500 and granted the motion for costs in the amount of $641,557.58. After reviewing the named plaintiffs’ time and the financial and reputational risks they described, the court found $10,000 per named plaintiff reasonable. It therefore granted the request for incentive awards, but in the amount of $10,000 to each named plaintiff rather than the requested $15,000.

Disposition

The court granted the motion for final approval of the class action settlement and granted in part and denied in part the motion for attorneys’ fees, costs, and incentive awards. It approved the $9,650,000 settlement, the attorneys’ fees, the litigation-cost reimbursement, and the $10,000 service award for each named plaintiff. The parties and settlement administrator were directed to implement the settlement, and the parties were directed to file a short stipulated final judgment within 14 days of the order.