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Consumers who participated in the MedAmerica Inc. employee 401(k) profit-sharing plan at any time between Nov. 1, 2017, and Jan. 31, 2025, may qualify to claim a cash payment from a class action settlement.
CEP America LLC, doing business as Vituity, agreed to pay $8,750,000 to resolve a class action lawsuit alleging the company and the MedAmerica Retirement & Benefits Committee breached their fiduciary duties under the Employee Retirement Income Security Act of 1974. The lawsuit claimed the defendants caused the plan to pay excessive administrative fees and offered an ill-advised capital preservation option.
Who are the class members?
The class includes all current and former employees who:
- Participated in the MedAmerica Inc. 401(k) profit-sharing plan at any time from Nov. 1, 2017, to Jan. 31, 2025
- Were not members of the MedAmerica Retirement & Benefits Committee during that period
The class is estimated to include approximately 11,196 people.
How much can class members get?
Pro rata payment: The total settlement fund is $8,750,000. After deducting attorneys' fees and costs, settlement administration costs, service awards to the named plaintiffs and other expenses, the settlement administrator will distribute the remaining net settlement amount to eligible class members.
The amount each class member receives depends on their year-end account balance in the plan during the class period. Importantly, the settlement doubles balances in the Schwab Bank savings account for the purposes of this calculation. If a class member did not participate or had no balance in a particular year, that year is counted as zero in the calculation.
Key points:
- The minimum payment for any eligible class member is $10.
- If a class member only had a balance on Jan. 31, 2025, or Dec. 31, 2017, but not in other years, they will still receive $10.
- If a class member is entitled to less than $10, their award will be increased to $10.
No action needed to receive payment
Most class members do not need to take any action to receive their payment. The settlement administrator already has the information needed to identify them.
Current participants with a positive plan account balance at the time of distribution will receive payment will be deposited directly into your plan account.
Former participants or those whose account is closed will receive a check by mail unless they submit a rollover form to have their payment sent directly to another qualified retirement account. Class members must submit the rollover form by Sept. 16, 2025. They can download the PDF claim form or request it from the settlement administrator.
Settlement administrator's mailing address: MedAmerica ERISA Settlement Administrator c/o Rust Consulting Inc - 8920, PO Box 2396 Faribault, MN 55021-9096
$8.75 million settlement fund breakdown
The $8,750,000 settlement fund includes:
- Settlement administration costs: $100,000 for administrative costs that arise before the effective date
- Attorneys' fees and expenses: To be determined
- Service awards to class representatives: Up to $15,000 each
- Payments to eligible class members: The remainder of the fund
Important dates
- Rollover form deadline: Sept. 16, 2025
- Final approval hearing: Oct. 16, 2025
When is the MedAmerica ERISA Settlement payout date?
Payments will be made after the court grants final approval and any appeals are resolved.
Why was there a class action settlement?
The class action lawsuit alleged CEP America LLC and the MedAmerica Retirement & Benefits Committee breached their fiduciary duties under the Employee Retirement Income Security Act of 1974 by causing the plan to pay excessive administrative fees and offering an ill-advised capital preservation option (the Schwab Bank savings account).
The defendants denied all wrongdoing but agreed to settle to avoid the uncertainty and expense of further litigation.
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