Merrill settles employee class action for $75M

The suit, brought under ERISA, claimed that Merrill didn’t adequately disclose subprime-related losses that affected its saving and investment plan, its retirement accumulation plan and its employee stock ownership plan.

Merrill Lynch & Co. Inc. has entered into a proposed settlement of a class action filed in 2007 by the firm’s employees over losses on its stock.
The New York-based company will pay $75 million in cash to settle the litigation.
The suit, brought under the Employee Retirement Income Security Act, claimed that Merrill didn’t adequately disclose subprime-related losses that affected its saving and investment plan, its retirement accumulation plan and its employee stock ownership plan InvestmentNewsJan. 14, 2008.
The U.S. District Court for the Southern District of New York must approve the deal, which was reached Friday.
The claims didn’t involve deferred compensation plans for brokers.
Merrill “vigorously disputed” the claims, said firm spokesman Mark Herr in a statement, but “we are pleased to have these lawsuits behind us.”
Merrill also said Friday that the lead plaintiff in a similar case, the State Teachers Retirement System of Ohio in Columbus, had agreed to a proposed settlement worth $475 million.
Similar ERISA claims filed against Citigroup Inc. and Morgan Stanley, both of New York, have yet to be resolved.