AME Pension Fund Settlement Agreement Reached, Awaiting Court Final Approval
Clergy awarded $60M in preliminary settlement with AME Church Retirement Services.
A settlement agreement between the African Methodist Episcopal (AME) Church pastors and the AME Retirement Services and denominational leadership has been preliminarily approved by a federal judge in Tennessee.
On March 24, District Judge Thomas Anderson preliminarily approved the AME agreement reached by parties on November 27, 2024, along with an agreement with Newport Group, a retirement services provider that was also named in the lawsuit.
In 2022, retired and current AME Church pastors filed six federal class-action lawsuits as plaintiffs alleging the church mishandled tens of millions of dollars in pension funds.
According to one of the original lawsuits filed in Maryland, the former leader of the church’s Department of Retirement Services “invested Plan assets in imprudent, extraordinarily risky investments that ultimately lost nearly $100 million of Plan participants’ retirement savings.”
The lawsuits were consolidated into one case in the U.S. District Court for the Western District of Tennessee, where AME Department of Retirement Services had its principal place of business.
In August 2024, the AME announced it had reached a tentative settlement agreement with the plaintiffs. “This initial settlement seeks to provide some immediate financial relief to the suffering of the AME Church’s participating clergy and staff but only represents partial recovery and is not intended to be the end of the AME Church’s march toward full restoration,” the denomination’s press release stated.
On December 13, 2024, the plaintiffs filed a motion for preliminary approval of their settlement agreement with the AME Church defendants.
The plaintiffs argued that the settlement should be approved because it provides “adequate relief in light of the risks, costs, and length of continued litigation” and “achieve[s] an excellent outcome for the class.”
The class will receive $60 million, which is 69% of the difference between the misrepresented value and the true value of the plan. Attorneys’ fees will take up to one-third of the settlement proceeds — a standard amount in class action cases.
The court found that the $60 million settlement “represents a reasonable recovery for the class,” especially considering the “time value of settling now and avoiding several years more of litigation.”
Verita Global, a firm experienced in legal settlement administration, was appointed by the court as settlement administrator. It will supervise and administer the notices to class members, establish and operate the settlement website, execute the plan of distribution as detailed in both the agreements, and perform any other duties that are reasonably necessary.
A fairness hearing to determine whether the settlement agreement “should be approved as fair, reasonable, adequate, and in the best interest of the [s]ettlement [c]lass [m]embers” was set for June 26, 2025, at 10 a.m. At the hearing, the court will also determine whether to enter an order concluding the case.
Any objections to the settlement agreement’s final approval by the court can be submitted by class members and will be considered by the court at the fairness hearing.
TO OUR READERS: Do you have a story idea, or do you want to give us feedback about this or any other story? Please email us: [email protected]
Access to MinistryWatch content is free. However, we hope you will support our work with your prayers and financial gifts. To make a donation, click here.
