1. What is the Notice and why should I read it?
A court authorized the Notice to let you know about a proposed settlement of a class action lawsuit called Pagans et al. v. Advance Auto Stores Company, Inc. et al., No. 7:21-cv-00549-MFU, brought on behalf of the Settlement Class Members, and pending in the United States District Court for the Western District of Virginia, Roanoke Division. The Notice describes the Settlement. Please read the Notice carefully. Your rights and options—and the deadlines to exercise them—are explained in the Notice. Please understand that if you are a Settlement Class Member, your legal rights are affected regardless of whether you act.
The Court has not yet decided whether to approve the Settlement. If the Court does so, and after any objections and appeals are resolved, the Net Settlement Amount will be allocated among Settlement Class Members according to a Court-approved Plan of Allocation. Information about your individual share of the Net Settlement Amount, if any, will not be available until several months after the Court grants final approval of the Settlement and any appeals are resolved.
2. What is a class action lawsuit?
A class action is a lawsuit in which one or more plaintiffs sue on behalf of a large group of people who allegedly have similar claims. After the Parties reached an agreement to settle this case, the Court granted preliminary approval of the Settlement and determined that the case should be treated as a class action for settlement purposes. Among other things, this preliminary approval permits Settlement Class Members to voice their support for, or opposition to, the Settlement before the Court makes a final determination of whether to approve the Settlement. Because this is a class action for settlement purposes, the Court will resolve these issues for all class members.
Plaintiffs in this Action, Janet Sweet, Safi M. Riaz, Bessie M. McAdams, Keith O. Edwards, and Peter H. Dargel, were participants in the Plan during the Class Period and are referred to as the “Plaintiffs”. The Court has appointed them as Class Representatives of the Settlement Class.
3. What is this Action about?Plaintiffs filed a complaint alleging that Defendants breached their fiduciary duties under ERISA—that is, certain responsibilities under federal law—by causing the Plan to incur unreasonable and “excessive” fees for administrative and investment services. Specifically, Plaintiffs alleged that Defendants caused the Plan and its participants to pay excessive fees for recordkeeping services and offered higher-cost “retail” investment options when lower-cost “institutional” options were available. A more complete description of what Plaintiffs alleged is in the operative Complaint.
Defendants deny any and all wrongdoing or liability and assert that their conduct was lawful. Defendants maintain that, at all relevant times, they have acted prudently and solely in the best interests of Plan participants, in accordance with their fiduciary duties under ERISA. Among other things, Defendants monitor, review, and evaluate the Plan’s investment options, their performance and expenses, and the Plan’s administrative fees, thus ensuring the Plan offers participants a reasonable, affordable, and diverse array of investment options.
4. Why is there a Settlement?The Court has not decided in favor of either side in the Action. Since the Action was filed October 2021, the Settling Parties have engaged in spirited litigation efforts, and included a full day mediation session before a neutral mediator, Robert Meyer of JAMS, a private alternative dispute resolution provider. The Parties’ mediation eventually resulted in the proposed Settlement. Plaintiffs and their attorneys believe the Settlement is the best option for the Settlement Class Members. As with any litigated case, Settlement Class Members would face an uncertain outcome if the Action were to continue, which could result in a range of possible recoveries, including a judgment greater or less than the recovery under the Settlement Agreement, or no recovery at all. Class Counsel thus believe this Settlement reflects a reasonable compromise in light of the range of possible outcomes, and that the Settlement is preferable to continued litigation and is in the best interest of the Settlement Class Members.
As noted, Defendants deny any and all liability associated with Plaintiffs’ allegations. However, Defendants have decided to settle the Action to avoid the expense, inconvenience, and inherent risk of continued litigation, thereby securing a full and final resolution of these claims as to the Released Parties on the terms and conditions set forth in the Settlement Agreement.
5. How do I know if I am part of the Settlement?
The Court has decided that anyone who fits the following description is part of the Settlement Class:
All persons, except individual Defendants and their immediate family members, who were participants in or beneficiaries of the Plan, at any time during the Class Period, and any Alternate Payee of a Person subject to a QDRO who participated in the Plan at any time during the Class Period.
The “class period” referred to in this definition is from October 20, 2015 to March 12, 2024. If you are a member of the Settlement Class, the amount of money you will receive, if any, will depend upon the Plan of Allocation, described below.
If you meet the definition above, then you are a member of the Settlement Class.
6. What does the Settlement provide?
Provided that the Settlement becomes Final, a Settlement Fund consisting of $1,700,000.00 will be established in the Action. The amount of money that will be allocated among members of the Settlement Class, after the payment of any taxes and Court-approved costs, fees, and expenses, including attorneys’ fees and expenses of Class Counsel, any Court-approved Case Contribution Awards to be paid to the Named Plaintiffs, and payment of expenses incurred in calculating the Settlement payments and administering the Settlement, is called the Net Settlement Amount. The Net Settlement Amount will not be known until these other amounts are quantified and deducted. The Net Settlement Amount will be allocated to members of the Settlement Class according to a Plan of Allocation to be approved by the Court. The Plan of Allocation describes how Settlement payments will be distributed to Settlement Class members who receive a payment.
If the Settlement is approved by the Court, all Settlement Class members and anyone claiming through them shall be deemed to fully release the Released Parties from Released Claims.
The Released Parties are (a) Defendants, their representatives, attorneys, agents, directors, officers, or employees; (b) Defendants’ insurers, co-insurers, excess carriers, and reinsurers, (c) Advance’s direct and indirect, past, present or future parents, subsidiaries, affiliates, divisions, joint ventures, predecessors, successors, successors-in-interest, and assigns, and each Person that controls, is controlled by, or is under common control with them, (d) the Plan and the Plan’s current and past fiduciaries, administrators, plan administrators, recordkeepers, service providers, consultants, and parties-in-interest and (e) Defendants’ current and past agents, officers, employees, trustees, Board of Trustees, and members of the Board of Trustees.
The above description of the proposed Settlement is only a summary. The complete terms, including the definitions of the Released Parties and Released Claims, are set forth in the Settlement Agreement (including its exhibits), which may be obtained at a dedicated Settlement Internet site, www.AdvanceERISAsettlement.com or by contacting Class Counsel listed on in Question 20 below.
7. How much will my payment be?
Each Settlement Class member’s share will be calculated according to a Court-approved Plan of Allocation by a third-party vendor (“Settlement Administrator”) selected by Class Counsel. You are not required to calculate the amount you may be entitled to receive under the Settlement as the Settlement Administrator will do so under the Plan of Allocation. In general, your proportionate share of the Settlement will be calculated as follows:
- First, the Settlement Administrator will obtain balances for each Settlement Class member in their Plan accounts as of October 20, 2015, or the balance reflected in their 2023 fourth quarter statement, whichever balance is more practical to obtain, and on December 31 of each subsequent year of the Class Period up to and including 2023. For Class Members who had a balance in their accounts at the beginning of the Class Period, but liquidated their account prior to December 31, 2023, the balance of their account at the time of their last quarterly statement will be the balance used for purposes of calculating an award under the Plan of Allocation. Each Class Member’s account balances for each year of the Class Period based on the account balances as of these dates will be summed. This summed amount will be that Class Member’s “Balance.”
- Second, the Balance for all Class Members will be summed.
- Third, each Class Member will receive a share of the Net Settlement Amount in proportion to the sum of that Class Member’s Balance as compared to the sum of the Balance for all Class Members, i.e. where the numerator is the Class Member’s Balance and the denominator is the sum of all Class Members’ Balances.
- The amounts resulting from this initial calculation will be known as the Preliminary Entitlement Amount. Class Members who are entitled to a distribution of less than $10.00 will receive a distribution of $10.00 (the “De Minimis Amount”) from the Net Settlement Amount. In other words, the Settlement Administrator shall progressively increase Class Members’ awards falling below the De Minimis Amount until the lowest participating Class Member award is the De Minimis Amount, i.e. $10.00. The resulting calculation shall be the Final Entitlement Amount for each Class Member. The sum of the Final Entitlement Amount for each Class Member will equal the dollar amount of the Net Settlement Amount.
You will not be required to produce records that show your Plan activity. If you are entitled to a share of the Settlement Fund, your share of the Settlement will be determined based on the Plan’s records for your account. If you have questions regarding the allocation of the Net Settlement Amount, please contact Class Counsel listed in the answer to Question 20 below.
8. How do I get a settlement payment?
You do not need to file a claim. The Entitlement Amount for Settlement Class members with an Active Account (an account with a positive balance) as of the date of the calculation of the Final Entitlement Amount, will be allocated into their Plan account, (unless that Plan account has been closed in the intervening period between the calculation of the Entitlement Amount and the payment of the Entitlement Amount, in which case that Class Member will receive their allocation via a check from the Settlement Administrator.
All such payments are intended by the Settlement Class to be “restorative payments” in accordance with Internal Revenue Service Revenue Ruling 2002-45. Checks issued to Former Participants pursuant to this paragraph shall be valid for 180 days from the date of issue. If you are a former Plan participant and have not provided the Plan with your current address, please contact Class Counsel listed in the answer to Question 20 below.
Each Class Member who receives a payment under this Settlement Agreement shall be fully and ultimately responsible for payment of any and all federal, state, or local taxes resulting from or attributable to the payment received by such person.
9. When will I get my payment?
The Settlement cannot be completed unless and until several events occur. These events include approval of the Settlement by an independent fiduciary to the Plan, final approval of the Settlement by the Court, transfer of the Net Settlement Amount to the Plan, and calculation of the amount of the Settlement owed to each Settlement Class member. If objections are made to the Settlement or appeals are taken by objectors who oppose the approval of the Settlement, this process may take a long time to complete, possibly several years.
There will be no payments if the Settlement Agreement is terminated.
The Settlement Agreement may be terminated for several reasons, including if (1) the Court does not approve or materially modifies the Settlement Agreement, or (2) the Court approves the Settlement Agreement, but the approval is reversed or materially modified by an appellate court. If the Settlement Agreement is terminated, the Action will proceed in litigation again as if the Settlement Agreement had not been entered into. The Settlement is not conditioned upon the Court’s approval of attorneys’ fees, or the reimbursement of litigation expenses sought by Class Counsel, the Case Contribution Awards sought by the Named Plaintiffs, or any appeals solely related thereto.
10. Who represents the Settlement Class, including me?
For purposes of the Settlement, the Court has appointed as Plaintiffs’ “Class Counsel” the law firms of Capozzi Adler, P.C., Aaron B. Houchens, P.C., and Fitzgerald, Hana, Sullivan, PLLC. If you want to be represented by your own lawyer, you may hire one at your own expense.
In addition, the Court appointed Plaintiffs Janet Sweet, Safi M. Riaz, Bessie M. McAdams, Keith O. Edwards, and Peter H. Dargel as Class Representatives of the Settlement Class. They are also Settlement Class Members. Subject to approval by the Court, Class Counsel has proposed that $10,000 may be paid to each Class Representative, in recognition of time and effort they expended on behalf of the Settlement Class. The Court will determine the proper amount of any such payment to Plaintiffs.
11. How will the lawyers be paid?
No later than June 5, 2024, Class Counsel will file a petition asking the Court to award attorneys’ fees, litigation costs, and case contribution awards to the Named Plaintiffs (a copy will be posted on the Important Documents page). The Court will consider Class Counsel’s petition at the Fairness Hearing. Class Counsel will apply for attorneys’ fees not to exceed one-third of the Gross Settlement Amount, plus out-of-pocket expenses incurred in prosecuting this case. The Court will decide the amount of any attorneys’ fees and expenses to award to Class Counsel. Any and all attorneys’ fees and litigation expenses awarded by the Court will be paid to Class Counsel from the Gross Settlement Amount.
As noted, Class Counsel also will request that $10,000 be paid from the Gross Settlement Amount to each of the five Named Plaintiffs, in recognition of their assistance in this case.
You have the right to object to this aspect of the Settlement even if you approve of its other aspects.
12. What is the effect of the Court’s final approval of the Settlement?
If the Court grants final approval of the Settlement, a final order and judgment dismissing the case will be entered in the Action. Payments under the Settlement will then be processed and distributed. The release by Settlement Class Members will also take effect. All members of the Settlement Class will release and forever discharge the University, Defendants, and each of the other Released Parties from any and all of “Plaintiffs’ Released Claims,” which are defined in the Settlement Agreement (at ¶ 1.39) as follows:
1.39. “Released Claims” means any and all actual or potential claims (including claims for any and all losses, damages, unjust enrichment, attorneys’ fees, disgorgement, litigation costs, injunction, declaration, contribution, indemnification or any other type or nature of legal or equitable relief), actions, demands, rights, obligations, liabilities, expenses, costs, and causes of action, accrued or not, whether arising under federal, state, or local law, whether by statute, contract, or equity, whether brought in an individual or representative capacity, whether accrued or not, whether known or unknown, suspected or unsuspected, foreseen or unforeseen based in whole or in part on acts or failures to act through the end of the Class Period:
1.39.1 That were asserted or could have been asserted in the Class Action, or that arise out of, relate to, or are based on any of the allegations, acts, omissions, facts, matters, transactions, or occurrences that were alleged, or could have been alleged, asserted, or set forth in the operative Complaint or in any complaint previously filed against Defendants; or
1.39.2 That arise out of, relate in any way to, are based on, or have any connection with (a) the selection, oversight, retention, monitoring, compensation, fees, or performance of the Plan’s investment options or service providers; (b) disclosures or failures to disclose information regarding the Plan’s investment options, fees, or service providers; (c) the management, oversight or administration of the Plan or its fiduciaries; or (d) alleged breach of the duty of loyalty, care, prudence, diversification, or any other fiduciary duties or prohibited transactions under ERISA with respect to the supervision or management of the Plan; and (e) include all calculations that are part of the allocation and distribution process of the Settlement; or
1.39.3 That would be barred by res judicata based on entry of the Final Order; or
1.39.4 That relate to the direction to calculate, the calculation of, and/or the method or manner of allocation of the Qualified Settlement Fund to the Plan or any Class Member in accordance with the Plan of Allocation; or
1.39.5 That relate to the approval by the Independent Fiduciary of the Settlement, unless brought against the Independent Fiduciary alone.
1.39.6 “Released Claims” do not include any claims for benefits that may be asserted against the Plan that the Class Representatives or the Settlement Class has or may have arising solely under ERISA § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B), to the extent such claims do not relate to the Released Claims in Section 1.39. However, other claims asserted, or which could have been asserted in this action for breaches of fiduciary duties under ERISA § 502(a)(2), 29 U.S.C. § 1132(a)(2) or ERISA § 502(a)(3), 29 U.S.C. § 1132(a)(3) to address the claims asserted in the Complaint are included within the definition of “Released Claims.”
If the Settlement is approved, no Settlement Class Member will be permitted to assert any Released Claims in any other litigation.
13. Can I opt out of the Settlement?
No. If the Court approves the Settlement, you will be bound by it and will receive whatever benefits you are entitled to under its terms. You cannot exclude yourself from the Settlement. If the Court approves the Settlement, it will do so on behalf of a “mandatory” class under Federal Rule of Civil Procedure 23(b)(1), which does not permit class members to opt out of the Settlement Class. However, although you cannot opt out of the Settlement, you can notify the Court of any objection you might have to the Settlement, as described below (see Question 16).
14. What happens if I do nothing at all?
If you are a Settlement Class Member and do nothing, you still will participate in the Settlement of the Action as described in the Notice, and you will release any claims you may have against Defendants and the other Released Parties concerning the conduct Plaintiffs allege in this Action. You may receive a payment as described in Question 8.
15. Can I sue Defendants for the same thing later?
No. If the Court approves the Settlement, you will have released any right to sue the Defendants, or any Released Party for the claims being resolved by this Settlement and any and all other “Released Claims,” as set forth in the Settlement Agreement (and in Question 12 above).
16. How do I tell the Court that I object to the Settlement?
If you are a Settlement Class Member, you can object to the Settlement if you do not agree with any part of it. To object, you must file with the Court a written statement of your objection(s), specifying the reason(s) for each objection, including any legal support or evidence that you wish to bring to the Court’s attention. The Court will consider your views.
Your objection must include your name, address, and phone number. Your objection must also be signed by you or your counsel. Be sure to also include the following case caption and notation: “Pagans et al. v. Advance Auto Stores Company, Inc. et al., No. 7:21-cv-00549 (W.D. Va.)”.
You must mail your objection to each of the addresses listed below and file the objection with the Court by July 5, 2024. If you do not timely file an objection it will be deemed to have been waived, and you will be barred from raising the untimely objection.
Court | Class Counsel | Defendants’ Counsel |
Clerk of the Court United States District Court for the Western District of Virginia Roanoke Division 210 Franklin Road, SW | Mark K. Gyandoh Capozzi Adler, P.C. 312 Old Lancaster Rd Merion Station, PA 19066 | René E. Thorne Jackson Lewis P.C. 601 Poydras Street Suite 1400 New Orleans, LA 70130 |
17. When and where will the Court decide whether to approve the Settlement?
The Fairness Hearing currently is scheduled for July 19, 2024 at the United States District Court for the Western District of Virginia Roanoke Division, 210 Franklin Road, SW, Roanoke, VA 24011-2208, before the Hon. Michael F. Urbanski, or other courtroom as the Court may designate. The Court may hold this hearing in person or via Zoom or other videoconference technology designated for use by the United States District Court system.
The Court may adjourn the Fairness Hearing without further notice to the Settlement Class and also may schedule the hearing to be done by telephone or video conference at its sole discretion. If you wish to attend, you should confirm the date and time of the Fairness Hearing with Class Counsel before doing so or on the Court’s official docket.
At the hearing, the Court will hear any comments, objections, and arguments concerning the fairness of the proposed Settlement, including the amount requested by Class Counsel for Attorneys’ Fees and Expenses and the proposed Case Contribution Awards. You may attend the Fairness Hearing and may also ask to speak. If there are objections, the Court will consider them—but you do not need to attend the Fairness Hearing to have the Court consider an objection.
18. Do I have to come to the hearing?
No, but you are welcome to come at your own expense. Class Counsel will answer any questions the Court may have. If you send an objection, you do not have to attend the Final Fairness Hearing to voice your objection in person. As long as you mail your written objection on time and meet the other criteria outlined above, the Court will consider it. You also may pay your own lawyer to attend the Fairness Hearing, but attendance is not necessary.
19. May I speak at the hearing?
Yes. You must send a letter or other paper called a “Notice of Intention to Appear at the Fairness Hearing in Pagans et al. v. Advance Auto Stores Company, Inc. et al., No. 7:21-cv-00549 (W.D. Va.).” Be sure to include your name, address, telephone number, and signature. Your Notice of Intention to Appear must be postmarked no later than July 12, 2024, and be sent to the Clerk of the Court, Class Counsel, and Defendants’ Counsel at the addresses listed above.
20. Where can I get more information?
The Notice provides only a summary of matters relating to the Settlement. For more detailed information, you may wish to review the complete Settlement Agreement.
You may also obtain more information by writing to the Settlement Administrator at Advance Stores Settlement, P.O. Box 995, Mequon, WI 53092, by emailing settlement@CapozziAdler.com (writing in the subject line: Advance Settlement) , or by calling toll-free at (866) 220-0004. The Settlement Agreement and other pleadings and papers filed with the Court are also available during regular business hours at the office of the Clerk of the Court, United States District Court for the Western District of Virginia Roanoke Division, 210 Franklin Road, SW, Suite 350, Roanoke, VA 24011-2208.
If you would like additional information, you may email Class Counsel at the below address writing in the subject line, “Advance Settlement”:
Mark K. Gyandoh
Capozzi Adler, P.C.
312 Old Lancaster Rd
Merion Station, PA 19066
settlement@CapozziAdler.com