Bloomberg Law
March 24, 2023, 4:07 PM

Takeda Pharmaceuticals’ $22 Million 401(k) Deal Wins Court Nod

Jacklyn Wille
Jacklyn Wille
Legal Reporter

Takeda Pharmaceuticals USA Inc. on Friday received final approval for a $22 million class settlement with workers challenging the target date funds in their 401(k) plan.

The settlement is expected to benefit about 8,000 people covered by Takeda’s $1.8 billion 401(k) plan. It requires the company to use a competitive bidding process to look for a new plan recordkeeper and to schedule annual trainings for plan fiduciaries.

Judge William G. Young of the US District Court for the District of Massachusetts signed the final approval order. Young also ruled on the plan participants’ request for about $7.4 million in attorneys’ fees, saying in an electronic order that he’d award fees of one-third of the net settlement amount, rather than one-third of the gross amount.

The lawsuit centers on the Takeda plan’s investment in a suite of target date funds from Northern Trust, which isn’t named as a defendant. According to plan participants, these Northern Trust Focus Funds “suffered from significant and ongoing quantitative deficiencies and turmoil,” consistently underperformed compared to alternatives, and drove steep losses. Takeda selected these funds for the plan only one year after their creation and without any significant performance history to demonstrate they were prudent investment options, the lawsuit claimed.

The Northern Trust Focus Funds have driven several recent lawsuits raising claims under the Employee Retirement Income Security Act. Both Allstate Corp. and Northern Trust itself lost bids to dismiss litigation over these funds, and Walgreens signed a $13.75 million class settlement in a similar case.

Takeda is represented by Morgan, Lewis & Bockius LLP. The plan participants are represented by Schlichter Bogard & Denton LLP and Naumes Law Group.

The case is Ford v. Takeda Pharms. USA, Inc., D. Mass., No. 1:21-cv-10090, final approval order 3/24/23.

To contact the reporter on this story: Jacklyn Wille in Washington at

To contact the editors responsible for this story: Carmen Castro-Pagán at; Patrick L. Gregory at

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