Settlement Announced in Invesco Self-Dealing Suit

Parties in a lawsuit accusing Invesco of self-dealing in its 401(k) plan have filed a Notice of Settlement.

It may seem strange that Invesco has agreed to settle the case since a U.S. District Court Judge previously granted summary judgment in favor of Invesco. However, in that opinion, the court also allowed the plaintiffs 20 days to file an amended complaint.

In the previous opinion, the judge wrote: “The Court does not agree with defendants that leave to amend the complaint should be denied as futile. Plaintiff’s allegations that during the class period, between 55% to 68% of all plan investments were affiliated with Invesco, and that by December 31, 2016, 81% of investments made by plan participants were in Invesco-affiliated funds, give the Court pause when it takes into consideration the allegation that the bonus performance criteria under the Invesco Executive Incentive Bonus Plan includes assets under management, net revenue yield on assets under management, operating revenues, and net asset flows.”

These allegations are further concerning, the Court states, considering the plaintiff’s allegations regarding the limitation of access to non-Invesco affiliated funds.

Invesco was granted summary judgment, though, because the judge felt the plaintiff’s claims were lacking sufficient strength to state plausible claims. The court docket shows that, prior to the Notice of Settlement, the court had granted him extended time to file his amended complaint.

The Notice of Settlement says, “The parties will work diligently on a written settlement agreement and prepare and submit a motion for preliminary approval of the anticipated class settlement under Rule 23(e) of the Federal Rules of Civil Procedure. The parties anticipate they will be in a position to make that submission to the Court within 60 days.”