Welcome to the Settlement website for In re National City Corporation Securities, Derivative & ERISA Litigation, Civil Action No. 08-nc-70000 (the “Action”).  This website has been established to provide general information related to this litigation and the resulting Settlement.  The capitalized terms used on this website and not defined herein shall have the same meanings ascribed to them in the Class Action Settlement Agreement.

 

UPDATE: As scheduled, on November 30, 2010, the Court held a final fairness hearing. The Court granted Plaintiffs' motions (1) for Final Approval of Class Action Settlement, Certification of Settlement Class and Approval of Plan of Allocation and (2) for Award of Attorneys' Fees, Reimbursement of Expenses and Case Contribution Awards.  The orders are available on the Court Documents page of this website.

 

 

On January 10, 2008, Plaintiff James Elsinghorst, a former employee of National City Corporation (“National City”) and participant in the National City Savings and Investment Plan (the “Plan”), filed his initial Class Action Complaint pursuant to Sections 409 and 502 of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), 29 U.S.C. §§ 1109 and 1132, against National City and certain other alleged named and unnamed fiduciaries of the Plan, who allegedly are and were responsible for the investment of the Plan’s assets.  Plaintiff Elsinghorst claimed that Defendants breached their fiduciary duties under ERISA by permitting the Plan to invest in the National City Stock Fund. Thereafter, six additional, substantially identical cases were filed in this Court.  By Order dated April 8, 2008, the Court consolidated the then-filed ERISA cases as well as any thereafter filed in or transferred to the Northern District of Ohio arising out of the same facts and claims.

 

By Order dated May 12, 2008, the Court appointed James Elsinghorst and Barbara Grosick as Lead Plaintiffs and the firms of Barroway Topaz Kessler Meltzer & Check, LLP and Stull, Stull & Brody as interim Co-Lead Counsel.

 

On June 26, 2008, Lead Plaintiffs filed a Consolidated Complaint for Violations of ERISA.  The following Named Plaintiffs were identified in the Consolidated Complaint:  Sharon A. Deucher, Deborah Douglas, James Elsinghorst, Barbara Grosick, Charles C. Gunning, Robert Huenefeld, Rita Klabenesh, Rodolfo Ranallo, Jr., George Rithianos, Loretta D. Rogers, Robert Steinberg, and Ella R. Whitlow.  The following Defendants were identified in the Consolidated Complaint:  National City Corporation, National City Bank, the Board of Directors of National City Corporation, the Administrative Committee of the National City Savings and Investment Plan, David A. Daberko, and Jon. N. Couture.  The Consolidated Complaint alleged that Defendants breached their fiduciary duties under ERISA by permitting the Plan to invest in the National City Stock Fund and Allegiant Funds even though National City stock and the Allegiant Funds were imprudent investments for the Plan.

 

On September 10, 2008, Defendants filed a motion to dismiss the Consolidated Complaint with prejudice.  The consolidated cases were transferred to the docket of Judge Solomon Oliver, Jr. on October 30, 2008.  On August 5, 2009, the Court referred the motion to dismiss to Magistrate Judge Nancy A. Vecchiarelli for a report and recommendation.  The motion to dismiss remained pending when the Class Action Settlement Agreement was signed by the Parties on August 20, 2010.

 

On November 26, 2008, the United States Judicial Panel on Multidistrict Litigation issued an order establishing a multidistrict litigation (“MDL”) proceeding before Judge Oliver, captioned In re National City Corporation Securities, Derivative and ERISA Litigation, MDL No. 2003.  The MDL encompasses the consolidated ERISA cases, as well as other securities, shareholder and derivative cases based on related facts and allegations.

 

 

Counsel for Plaintiffs and Defendants discussed the possibility of settlement at various points in time during the litigation.  In or about August 2009, the parties began to discuss engagement of an independent mediator and agreed upon a well-known, respected and experienced mediator.  The parties also agreed to file a joint motion for an order to temporarily withhold issuance of a report and recommendation on the pending motion to dismiss during the pendency of settlement efforts and, on October 8, 2009, the Court entered an order granting that motion.

 

A mediation was held in New York City over a two-day period on February 4 and 9, 2010.  In preparation for the mediation, the parties submitted their respective mediation statements and supporting materials.  At the conclusion of the mediation, the parties agreed to a settlement in principle.

 

 

The Settlement Class is defined as follows:

 

 

The Settlement seeks class certification under the Federal Rules of Civil Procedure as a “non opt-out” class action because of the way ERISA operates.  Thus, it is not possible for any participants or beneficiaries to exclude themselves from the Settlement.  As a Settlement Class member, you will be bound by any judgments or orders that are entered in the Action for all claims that were or could have been asserted in the Action or are otherwise included in the release under the Settlement.

 

The Defendants have agreed to create a Qualified Settlement Fund consisting of forty-three million dollars in United States currency ($43,000,000.00) (the “Class Settlement Amount”) to be divided among eligible Settlement Class members, after payment of any Court-approved attorneys’ fees and expenses, compensation payments to the Named Plaintiffs, and payment of other costs and expenses of the Settlement.  The Class Action Settlement Agreement describes the details of the proposed Settlement.  This Settlement releases certain claims against the Defendants with respect to the investment of the Plan’s assets in the National City Stock Fund and the Allegiant Funds during the Class Period.

A Fairness Hearing has been scheduled for Tuesday, November 30, 2010 at noon, in the courtroom of Judge Solomon Oliver, Jr. at the Carl B. Stokes United States Court House, 801 West Superior Avenue, Cleveland, OH 44113-1838.   At the Fairness Hearing, the Court will consider whether to approve the Settlement.  The Court will also consider whether to grant Co-Lead Counsel’s application for an award of attorneys’ fees’, reimbursement of expenses and Named Plaintiffs' Case Contribution Awards.  To date, Co-Lead Counsel have not received any payment for their services in prosecuting this Action on behalf of the Settlement Class, nor have they been reimbursed for their out-of-pocket expenses.

 

If you have questions about the Settlement in In re National City Corp. Securities, Derivative & ERISA Litigation, please send an email to: nccerisa@ssbny.com.  This email will go to Co-Lead Counsel and will be directed to the individuals handling the Settlement.  Co-Lead Counsel have also set up a toll free number, 866-828-2555, if you prefer to call with your questions.