IL Federal Judge Grants Class Certification to Astellas Workers Over 401(k) Losses

April 1, 2022
Hall Benefits Law, LLC

In Wachala et al. v. Astellas US LLC et al., case number 1:20-cv-03882, U.S. District Court for the Northern District of Illinois, Astellas employees sued their employer and the retirement plan’s investment manager, Aon Investments USA Inc. The employees claim that Aon violated ERISA by selecting its own investment trusts as plan options. In addition, they point out that Aon replaced better-performing funds with its own funds, even though it was a conflict of interest and not in the workers’ best interests. The employees also argue that Astellas failed to monitor Aon’s actions properly. 

The employees allege that violations of fiduciary duty and prohibited transactions caused them to lose millions in retirement savings. 

An Illinois federal judge granted class certification to three classes of Astellas Pharma US Inc. 401(k) retirement plan participants in their ERISA suit. The “equitable relief” class consists of all plan participants with a current account balance, or about 4,000 workers. The other two classes, the “payment of plan assets” class and the “investment loss” class, consist of those workers who invested in certain funds, or about 2,500 and 2,300 workers, respectively. 

Astellas and Aon argued against class certification, stating that the classes would be at odds. They claim that there are “intractable conflicts” between the “investment loss” and “equitable relief” classes due to calculation errors.

Nonetheless, the judge found all three classes to be ascertainable and composed of sufficient members to constitute a class. Furthermore, the judge noted that class members all share a common legal issue or meet the commonality requirement for class actions. Finally, the judge ruled that the classes met typicality and adequacy requirements, despite experts’ different calculations of loss for each side to the lawsuit. He stated that the “loss-calculation question is a legal one” rather than a question of class certification. The fact that the two sides performed loss calculations differently does not impact the appropriateness of class certification. 

HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.

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