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Presence Settlement

Welcome to the Carver v. Presence Health Settlement website. This website is intended to keep class members informed regarding the Class Action Settlement. The content of this website is the responsibility of Plaintiffs’ Counsel, and has not been approved by the Court.

On July 10, 2018, the Honorable Harry D. Leinenweber granted final approval of the Settlement.

Background

The case involves the Resurrection Health Care Retirement Plan (the “RHC Plan”) and the Provena Health Employees’ Pension Plan (the “Provena Plan”) (collectively, the “Plans”), which are defined benefit pension plans.

Plaintiff Carver filed a complaint on April 2, 2015 (which was later amended), alleging that the Plans’ sponsor, Presence Health Network, and the other Defendants denied ERISA protections to the participants and beneficiaries of the Plans by claiming that the Plans qualify as ERISA-exempt “church plans.” The complaint further alleged that Defendants violated ERISA in a variety of ways, and alternatively, that application of the church plan exemption to the Presence Plans violates the Establishment Clause of the Constitution.

After litigating in the District Court, and after the United States Supreme Court’s decision in three other “church plan” cases, this case went to mediation.  The Parties and Ascension Health (another health care system that was planning to acquire the Presence health care system) reached a compromise with the mediator’s assistance.  A Class Action Settlement Agreement (the “Settlement Agreement”) was signed on February 21, 2018. Judge Leinenweber granted final approval of the Settlement Agreement on July 10, 2018.

As of March 1, 2018, the Plans are no longer sponsored by Presence Health Network, but are sponsored by Ascension Health or a subsidiary of Ascension Health.

The Settlement Class

On July 10, 2018, final approval of the Settlement was granted on behalf of the following class (the “Settlement Class”):

All persons who, as of November 30, 2017, are former and/or current participants in either or both of the Plans, whether vested or non-vested, and their beneficiaries.

The Settlement

The Settlement resolves all claims against Defendants and applies to all past and present, vested and non-vested, participants in the Plans and their beneficiaries.

The Settlement provides for a guarantee of payment of the first $20,000,000 (twenty million dollars) of benefits that are distributable from either or both of the Plans’ trusts to Settlement Class members if either of the Plans is unable to pay such benefits. The Settlement also provides that Ascension Health, or any of the Releasees, may buy out this guarantee obligation at any time by making contributions to the Plans’ trusts in an aggregate total of $15,000,000 (fifteen million dollars).

Additionally, the Settlement provides significant non-monetary equitable consideration, in that current participants in the Plans will receive certain ERISA-like reporting, disclosure, and administrative protections. For seven and one-half years, the Plans’ participants will receive notice on an annual basis about the funded status of the Plans and the retirement benefits that they have accrued. This annual notice will include, among other information, a summary of the Plans’ funding arrangements, a summary of the Plans’ expenses, a statement of the Plans’ liabilities and assets, information about the increase or decrease in net plan assets for the year, and summary information about the Plans’ total income. The Settlement Agreement also provides that for seven and one-half years, any amendment or termination of the Plans cannot reduce participants’ accrued benefits. Likewise, for the next seven and one-half years, if the Plans are ever merged with or into another plan, participants will be entitled to the same or greater benefits than they were before the merger.

Released Claims and Fairness Hearing

The Named Plaintiffs and Class Counsel believe that this Settlement is in the best interest of the Settlement Class members.  As a result of the Settlement, the Settlement Class releases the claims against Defendants pertaining to the church plan exemption (these claims are defined in the Settlement Agreement).

The Court held a Fairness Hearing at the U.S. District Court for the Northern District of Illinois on July 10, 2018 and considered the fairness of the proposed Settlement. The Court considered arguments concerning the proposed Settlement’s fairness at that time and entered an order approving the Settlement.

Settlement FAQs

Q: How do I know whether I am part of the Settlement?

The Court has certified the Action as a class action for settlement purposes only. You are a member of the Settlement Class if, as of November 30, 2017, you were a former and/or current participant in either or both of the Plans, whether vested or non-vested, or the beneficiary of such a participant.

Q: What does the Settlement provide?

The Settlement provides that, as long as the Plans are sponsored by any of the Releasees, as defined in the Settlement Agreement, there is a guarantee of payment of the first $20,000,000 (twenty million dollars) of benefits that are distributable from either or both of the Plans’ trusts to Settlement Class members if either of the Plans is unable to pay such benefits. The guarantee is given by Ascension Health. Should a corporate transaction occur where the Plans’ assets and liabilities covering Settlement Class Members transfer to a successor, Ascension Health will cause the successor to honor this commitment. The Settlement also provides that Ascension Health, or any of the Releasees, may buy out this guarantee obligation at any time by making contributions to the Plans’ trusts in an aggregate total of $15,000,000 (fifteen million dollars). Upon the Plans’ trusts’ timely receipt of the $15,000,000 (fifteen million dollar) buyout amount, the guarantee obligation will be extinguished.

The Settlement includes equitable provisions which mimic certain provisions of ERISA concerning plan administration, summary plan descriptions, notices (annual summaries, pension benefits statements, current benefit values), and the Plans’ claims review procedures. For seven and one-half years, the Plans’ participants with receive notice on an annual basis about the funding status of the Plans and the retirement benefits that they have accrued. The Settlement Agreement also provides that for seven and one-half years, any amendment or termination of the Plans cannot reduce participants’ accrued benefits. Likewise, for the next seven and one-half years, if the Plans are ever merged with or into another plan, participants will be entitled to the same or greater benefits than they were before the merger.

Q: How will the Settlement be distributed?

Because the Plans are defined benefit pension plans and not defined contribution plans with individual accounts, like a 403(b) plan or 401(k) plan, the guarantee, if ever paid in the future, will be contributed to the Plans’ trust funds as a whole, rather than to individual Plan participants and beneficiaries. Your pension benefit will not increase as a result of the Settlement. You will remain entitled to the benefit you have accrued pursuant to the Plans’ terms, and under the Settlement, for seven and one-half years, the Plans cannot be amended to reduce your accrued benefit. The Settlement also provides significant non-monetary equitable consideration, in that current participants in the Plans will receive certain ERISA-like administrative protections, including certain annual notices for the next seven and one-half years.

Members of the Settlement Class do not need to do anything in order to obtain the benefits and protections provided by the Settlement in this case.

Q: How will the lawyers be paid?

Court appointed Class Counsel filed a motion for an award of attorneys’ fees and expenses, and incentive awards for the Named Plaintiffs. The Court considered and approved that motion at the Fairness Hearing on July 10, 2018. Payment of attorneys’ fees, expenses, and incentive awards to Named Plaintiffs does not reduce the amount of the guarantee or the amount of the buy-out.

Contact Us

For inquiries about this Settlement, please or call Class Counsel at (888) 684-6642 if you have questions or comments.

Please do not contact the Court. Its personnel will not be able to answer your questions.