stipulation and agreement of settlement and agreement … · gray, and mike osborn (collectively,...
TRANSCRIPT
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
EBRAHIM SHANEHCHIAN, et al.,
Plaintiff,
V.
MACY'S, INC. et al.,
Case No. 1 :07-cv-00828-SAS-SKB
Judge S. Arthur Spiegel Magistrate Judge Stephanie K. Bowman
Defendants
STIPULATION AND AGREEMENT OF SETTLEMENT
This Stipulation and Agreement of Settlement (the "Stipulation") is submitted in the
above-captioned action (the "Action"), pursuant to Rule 23(e) of the Federal Rules of Civil
Procedure. Subject to the approval of the United States District Court for the Southern District of
Ohio, Western Division, this Stipulation is entered into by and between Anita Johnson, Donald
Snyder, and Joseph Stengel (the "Class Representatives") on behalf of themselves, the Class (as
below defined), the Macy's, Inc. Profit Sharing 401 (k) Investment Plan (the "Macy's Plan"), and
the May Department Stores Company Profit Sharing Plan (the "May Plan") (together, the "Plans")
(with the Class Representatives, the Class, and the Plans, "Plaintiffs'), on the one hand; and
Macy's, Inc. ("Macy's") the Plan Committee for the Macy's, Inc. Profit Sharing 401(k)
Investment Plan and the May Department Stores Company Profit Sharing Plan (the "Committee"),
and Karen M. Hoguet, Terry L. Lundgren, Meyer Feldberg, Sara Levinson, Joseph Neubauer,
Joseph A. Pichler, Joyce M. Roche, Karl M. von der Heyden, Craig E. Weatherup, Mama C.
Whittington, William Stiritz, Stephen F. Bollenbach, Deirdre P. Connelly, Stephen J. O'Bryan,
Robert C. Zimmer, Dave Clark, Dick Brickson, R.B. Harrison, Tony Spring, Ron Tysoe, Jim
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 1 of 31 PAGEID #: 7966
Gray, and Mike Osborn (collectively, the "Individual Defendants") (with Macy’s and the
Committee, "Defendants"), on the other (with Plaintiffs, the "Parties").
PREAMBLE
A. On October 3, 2007, Ebrahim Shanehchian commenced this Action on
behalf of a purported class of Plan participants. The Class Representatives later intervened
as named plaintiffs and filed an Amended Complaint. They asserted claims for violations
of the Employee Retirement Income Security Act of 11974 ("ERISA"), 29 U.S.C.
�S 1001-1461, arising out of Defendants’ administration of the Plans following Macy’s
acquisition of the May Department Stores Company in August 2005, including claims
related to the prudence and performance of the Plans’ investment options and claims
related to Defendants’ disclosures to Plan participants. By this Action, Plaintiffs seek to
recover alleged losses to the Plans, as well as equitable, injunctive and other monetary
relief, including attorneys’ fees. Defendants deny any liability or wrongdoing of any kind
associated with the claims alleged in the Action.
B. On March 10, 2011, the Court conditionally certified the Action as a class
action pursuant to Rules 23(a) and 23(b)(1) of the Federal Rules of Civil Procedure,
appointed the Class Representatives to represent the conditionally certified class and
designated the law firms of Harwood Feffer LLP, Milberg LLP, and Katz, Greenberger &
Norton, LLP as co-lead class counsel.
C. The Parties have reached agreement to settle any and all claims that were or
could have been raised in the Action on the terms and conditions set forth in this
Stipulation and its Exhibits (the "Settlement").
2
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 2 of 31 PAGEID #: 7967
D. The Settlement shall not be deemed or construed as evidence of any
admission or concession by any Party as to the merit or lack of merit of any claim or
defense that has or could have been asserted in the Action, or as evidence of any fault,
liability or wrongdoing on the part of any Defendant.
NOW THEREFORE, it is hereby STIPULATED AND AGREED, by and between
Plaintiffs and Defendants, through their respective counsel, subject to approval of the Court
pursuant to Rule 23(e), and in consideration of the benefits flowing to the Parties from the
Settlement, that all Settled Claims and all Settled Defendants’ Claims shall be compromised,
settled, released and dismissed with prejudice upon and subject to the following terms and
conditions:
1. DEFINITIONS
As used in this Stipulation, capitalized terms and phrases not otherwise defined herein have
the meanings provided below:
1.1 "CAFA Notices" means and refers to the notices which are to be prepared
and sent by Defendants to the appropriate state and federal officials pursuant to the Class
Action Fairness Act of 2005 ("CAFA"), 28 U.S.C. � 1715, substantially in the forms
attached at Exhibit D (not including their attachments).
1.2 "Class" means a non-opt-out class consisting of all individuals who were
Participants in either the Macy’s Plan or the May Plan at any time during the Class Period
whose Plan account included an investment in the Macy’s Company Stock Fund at any
time during that period. The Class specifically excludes the Individual Defendants, their
Immediate Family, and all current officers and directors of Macy’s.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 3 of 31 PAGEID #: 7968
1 .3 "Class Exemption" means the Prohibited Transaction Exemption 2003-39,
"Release of Claims and Extensions of Credit in Connection with Litigation," issued
December 31, 2003, by the United States Department of Labor, 68 Fed. Reg. 75,632, as
amended.
1.4 "Class Member" means a member of the Class.
1.5 "Class Period" means the period of time from February 27, 2005 through
and including July 24, 2012.
1.6 "Class Representatives" means Anita Johnson, Donald Snyder, and Joseph
Stengel.
1.7 "Court" means the United States District Court for the Southern District of
Ohio, Western Division.
1.8 "Defendants" means Macy's, the Committee and the Individual
Defendants.
1.9 "Defendants' Counsel" means the law firms of Morgan, Lewis & Bockius
LLP and Jones Day.
1.10 "Diversification Brochure" means and refers to a document describing the
benefits of maintaining a well-diversified retirement portfolio and the risks associated with
investments in the Macy's Company Stock Fund. The Diversification Brochure shall be
drafted and approved by Defendants, with the assistance of the Macy's Plan administrator,
and shall be distributed in accordance with Paragraph 3.1.4.
4
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 4 of 31 PAGEID #: 7969
.11 "Effective Date" means the date, established pursuant to Paragraph 8. 1, on
which all of the conditions to the Settlement set forth in Paragraph 8.1 have been fully
satisfied or waived, and the Settlement becomes Final.
1.12 "Escrow Agent" means the law firms of Milberg LLP and Harwood Feffer
LLP.
1.13 "Fairness Hearing" means the hearing to be held by the Court to determine,
among other things, whether to finally approve the Settlement, as contemplated by
Paragraph 7 of the form of Order for Notice and Hearing attached hereto as Exhibit A.
1.14 "Final," with respect to the Judgment, means the date on which the time for
filing or noticing an appeal therefrom expires or, if an appeal from the Judgment is filed,
the date on which the Judgment is affirmed by the highest court to which it is taken or the
time for filing or noticing any further appeal or petition for review expires, whichever
occurs latest. Appellate proceedings pertaining solely to Plaintiffs' Co-Lead Counsel's
application for attorneys' fees, costs or expenses and/or the Plan of Allocation shall not
delay or preclude the Judgment from becoming Final.
1.15 "Gross Settlement Fund" shall have the meaning set forth in Paragraph 3.2.
1.16 "Immediate Family" means spouses, parents, grandparents, children,
grandchildren, and siblings.
.17 "Independent Fiduciary" means a fiduciary of the Plans retained by
Defendants that has no "relationship to" or "interest in" (as those terms are used in the
Class Exemption) the Class Representatives or Defendants, to evaluate the fairness of the
5
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 5 of 31 PAGEID #: 7970
Settlement to the Plans and to issue the release set forth in Paragraph 2.2 on the Plans'
behalf.
1.18 "Individual Defendants" means Karen M. Hoguet, Terry L. Lundgren,
Meyer Feldberg, Sara Levinson, Joseph Neubauer, Joseph A. Pichler, Joyce M. Roche,
Karl M. von der Heyden, Craig E. Weatherup, Mama C. Whittington, William Stiritz,
Stephen F. Bollenbach, Deirdre P. Connelly, Stephen J. O'Bryan, Robert G. Zimmer, Dave
Clark, Dick Brickson, R.B. Harrison, Tony Spring, Ron Tysoe, Jim Gray, and Mike
Osborn.
1.19 "Judgment" means an order finally approving the Settlement and finding
that notice to the appropriate state and federal officials has been provided as required by,
and that Defendants have satisfied their obligations under, CAFA. A proposed form of the
Judgment is attached hereto as Exhibit B.
1.20 "Macy's" means Macy's, Inc.
1.21 "Long-Form Notice" means and refers to the notice which is to be posted on
the Settlement Website substantially in the form of Exhibit 2 to Exhibit A.
1.22 "Mail Notice" means and refers to the notice which is to be sent to members
of the Class substantially in the form of Exhibit I to Exhibit A.
1.23 "Net Settlement Fund" has the meaning set forth in Paragraph 3.4.
1.24 "Order for Notice and Hearing" means an order by the Court preliminarily
approving the Settlement; directing notice of the Settlement to the Class; finding that the
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 6 of 31 PAGEID #: 7971
CAFA Notices comply with the requirements of CAFA and will, upon mailing, discharge
Defendants’ obligations under CAFA; and scheduling the Fairness Hearing. A proposed
form of the Order for Notice and Hearing is attached hereto as Exhibit A.
1 .25 ’Participant" means any individual who, at any time during the Class
Period, was a "participant" of the Macy’s Plan or the May Plan, as defined in 29 U.S.C.
� 1002(7); (2) a "beneficiary" of a deceased "participant," as defined in 29 U.S.C. �
1002(8); or (3) an alternate payee of a "participant" under a qualified domestic relations
order, as defined in 29 U.S.C. � 1056(d)(3).
1.26 "Parties" means the Plaintiffs and the Defendants.
1.27 "Person" means an individual, partnership, corporation, governmental
entity or any other form of entity or organization.
1.28 "Plaintiffs" means the Class Representatives, the Class and the Plans.
1.29 "Plaintiffs’ Co-Lead Counsel" means the law firms of Harwood Feffer LLP,
Milberg LLP, and Katz, Greenberger & Norton, LLP.
1.30 "Plaintiffs’ Counsel" means Plaintiffs’ Co-Lead Counsel and the Law
Offices of Alfred G. Yates, Jr.
1.31 "Plans" means the Macy’s Plan and the May Plan.
1.32 "Plan of Allocation" means a plan for allocating the Net Settlement Fund to
the Class that is approved by the Court. A proposed Plan of Allocation is attached hereto as
Exhibit C.
7
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 7 of 31 PAGEID #: 7972
1 .33 "Predecessor" means, as to any Person (the "Subject Person"), another
Person as to whom the Subject Person is a Successor-in-Interest.
.34 "Publication Notice" means and refers to the summary notice which is to be
published to the media substantially in the form of Exhibit 3 to Exhibit A.
1 .35 "Released Parties" means the Defendants, every Person who, at any time
during the Class Period, was a director, officer, employee or agent of Macy's or a trustee or
fiduciary of either of the Plans, together with, for each of the foregoing, their Predecessors,
Successors-In-Interest, present and former Representatives, direct or indirect parents and
subsidiaries, affiliates, insurers, co-insurers, re-insurers, consultants, administrators,
employee benefit plans, investment advisors, investment bankers, underwriters, and any
Person that controls, is controlled by, or is under common control with any of the
foregoing.
1.36 "Representatives" means attorneys, agents, directors, officers, and
employees.
1.37 "Settled Claims" means any and all claims, debts, demands, rights causes
of action, suits, matters, issues and liabilities (including, but not limited to, any and all
claims for damages, interest, attorneys' fees, expert or consulting fees, and any other costs,
expenses or liabilities whatsoever), whether based on federal, state, local, statutory or
common law or any other law, rule or regulation, whether fixed or contingent, accrued or
unaccrued, liquidated or unliquidated, at law or in equity, matured or unmatured, including
both known claims and Unknown Claims, against any of the Released Parties that (a) were
asserted in the Action, including, but not limited to, all claims relating to Macy's stock or
ri] [b]
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 8 of 31 PAGEID #: 7973
the Macy’s Company Stock Fund in the Plans, and all claims relating to the disclosure or
non-disclosure of information with respect to Macy’s stock, the Macy’s Company Stock
Fund, or any of the Plans’ other investment options, during the Class Period; or (b) could
have been asserted in the Action and relate to investments in Macy’s stock, the Macy’s
Company Stock Fund, or any of the Plans’ other investment options, including, but not
limited to, all claims that relate to the prudence, fees, cost or performance of Macy’s stock,
the Macy’s Company Stock Fund or any of the Plans’ other investment options, at any time
during the Class Period. Notwithstanding the foregoing, "Settled Claims" does not include
any claims, rights, causes of action or liabilities (i) related to enforcement of the Settlement,
including any claims related to the Parties’ obligations under this Stipulation and its
Exhibits; or (ii) under the Securities Exchange Act of 1934, 15 U.S.C. �78a et seq., and the
rules and regulations promulgated thereunder.
1.38 "Settled Defendants’ Claims" means any and all claims, rights, causes of
action or liabilities, whether based on federal, state, local, statutory or common law or any
other law, rule or regulation, including both known claims and Unknown Claims, against
the Class Representatives and/or Plaintiffs’ Counsel that arise out of or relate in any way to
the institution or prosecution of the Action. Notwithstanding the foregoing, "Settled
Defendants’ Claims" does not include claims, rights, causes of action or liabilities related
to the enforcement of the Settlement, including any claims related to the Parties’
obligations under this Stipulation and its Exhibits.
1.39 "Settlement" means the negotiated resolution of the Action and related
releases set forth in this Stipulation and its Exhibits.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 9 of 31 PAGEID #: 7974
1 .40 "Settlement Administrator" means Berdon Claims Administration LLC, the
firm retained by Plaintiffs' Counsel to administer the Settlement.
1.41 "Settlement Amount" means Eight Million Five Hundred Thousand Dollars
and No Cents ($8,500,000.00) in cash.
1.42 "Settlement Fund" has the meaning set forth in Paragraph 3.1.2.
1.43 "Settlement Website" means the website to be established or maintained by
the Settlement Administrator where the Class Members can obtain copies of the
Long-Form Notice, this Stipulation and the Plan of Allocation, as described in the Mail
Notice.
1.44 "Stipulation" means this Stipulation and Agreement of Settlement.
1 .45 "Successor-In-Interest" means a Person's estate, legal representatives, heirs,
successors or assigns, including successors or assigns that result from corporate mergers or
other structural changes to business entities.
1.46 "Taxes" means (i) any and all applicable taxes, duties and similar charges
imposed by a government authority (including any estimated taxes, interest or penalties)
arising in any jurisdiction, if any, (A) with respect to the income or gains earned by or in
respect of the Gross Settlement Fund, including, without limitation, any taxes that may be
imposed upon Defendants or Defendants' Counsel with respect to any income or gains
earned by or in respect of the Gross Settlement Fund for any period during which it does
not qualify as a Qualified Settlement Fund for federal or state income tax purposes; or (B)
by way of withholding as required by applicable law on any distribution by the Escrow
LD
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 10 of 31 PAGEID #: 7975
Agent of any portion of the Gross Settlement Fund to any Persons entitled thereto pursuant
to this Stipulation; and (ii) any and all expenses, liabilities and costs incurred in connection
with the taxation of the Gross Settlement Fund (including without limitation, expenses of
tax attorneys and accountants). For the purposes of clause (i)(A) of this Paragraph, taxes
imposed on Defendants shall include amounts equivalent to taxes that would be payable by
Defendants but for the existence of relief from taxes by virtue of loss carryforwards or
other tax attributes, determined by Defendants, acting reasonably.
1.47 "Unknown Claims" means any and all Settled Claims which any of the
Class Representatives or Class Members does not know or suspect to exist in his, her or the
Plans’ favor as of the Effective Date and any Settled Defendants’ Claims which any
Defendant does not know or suspect to exist in his, her or its favor as of the Effective Date,
which, if known by him, her or it, might have affected his, her or its decision(s) with
respect to the Settlement. With respect to any and all Settled Claims and Settled
Defendants’ Claims, the Parties stipulate and agree that, as of the Effective Date, the Class
Representatives and the Defendants expressly waive, and each Class Member shall be
deemed to have waived, and by operation of the Judgment shall have expressly waived,
any and all provisions, rights and benefits conferred by any law of any state of the United
States, or principle of common law or otherwise, which is subject to, similar, comparable,
or equivalent to California Civil Code � 1542, which provides:
A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.
The Class Representatives and Defendants acknowledge, and Class Members by operation of law
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 11 of 31 PAGEID #: 7976
shall be deemed to have acknowledged, that the inclusion of "Unknown Claims" in the definition
of Settled Claims and Settled Defendants' Claims was separately bargained for and was a key
element of the Settlement.
2. SCOPE AND EFFECT OF SETTLEMENT
2.1 The obligations incurred by the Parties pursuant to this Stipulation shall be
in full and final disposition of the Action, any and all Settled Claims and any and all Settled
Defendants' Claims.
2.2 Upon the Effective Date of the Settlement, the Class Representatives, the
Plans, the Class Members, on behalf of themselves and their Representatives, heirs,
executors, administrators, trustees, Predecessors, Successors-In-Interest, and assigns (in
their capacities as such), release and forever discharge and are forever enjoined from
prosecuting any Settled Claim against any of the Released Parties and covenant not to sue
any of the Released Parties with respect to any of the Settled Claims. No Released Party
shall seek any remedy for assertion of Settled Claims by any Class Member other than the
Class Representatives until at least ten (10) days after providing such Class Member with
written notice of his or her release of, and the injunction against asserting, Settled Claims
and demanding such Class Member to desist from any conduct in violation thereof.
2.3 Upon the Effective Date of the Settlement, Defendants, on behalf of
themselves, the other Released Parties and their Representatives, heirs, executors,
administrators, trustees, Predecessors, Successors-in-Interest, and assigns (in their
capacities as such) release and forever discharge and are forever enjoined from prosecuting
12
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 12 of 31 PAGEID #: 7977
the Settled Defendants' Claims against the Class Representatives and/or Plaintiffs'
Counsel.
3. SETTLEMENT CONSIDERATION
3.1 In consideration of the release, discharge, and injunction set forth in
Paragraph 2.2:
3.1.1 within thirty (30) days following execution of this Stipulation,
Defendants shall cause their insurer, Chartis, to deposit the Settlement Amount into an
interest-bearing escrow account controlled by Chartis.
3.1.2 within ten (10) days following the Court's preliminary approval of
the Settlement, Defendants shall cause Chartis to transfer the escrowed funds into an
interest-bearing escrow account (the "Settlement Fund") established by Plaintiffs'
Co-Lead Counsel to serve as a depository for the Settlement Amount; and
3.1.3 if payment is due under Paragraph 3.1.2 before payment has been
made under Paragraph 3.1 .1, then payment shall be made by Chartis directly into the
Settlement Fund within the longer of the time periods set forth in Paragraphs 3. 1.1 and
3.1.2.
3.1.4 within one (1) year after the Net Settlement Fund is transferred
and/or distributed by the Escrow Agent pursuant to Paragraph 3.5, Defendants shall cause
the Macy's Plan administrator to distribute the Diversification Brochure to all current Plan
participants by first-class mail.
13
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 13 of 31 PAGEID #: 7978
3.2 All interest earned on the funds deposited into the Settlement Fund shall
accrue to the Settlement Fund. The Settlement Fund, together with all interest earned
thereon, shall constitute the Gross Settlement Fund.
3.3 The Gross Settlement Fund shall be deemed to be in the custody of the
Court and shall be held by the Escrow Agent exclusively for the purposes described in
Paragraphs 3.3 and 3.4 until such time as the Net Settlement Fund is distributed pursuant to
Paragraph 3.5 or otherwise by order of the Court. The Escrow Agent shall invest all funds
in excess of $250,000 in short-term U.S. Treasury securities, securities issued by United
States agencies or fully insured by the Federal Deposit Insurance Corporation ("FDIC"),
deposits and certificates of deposit fully insured by the FDIC and backed by the full faith
and credit of the U.S. Treasury, and short term debt or commercial paper fully guaranteed
by the FDIC under the Temporary Liquidity Guaranty Program and backed by the full faith
and credit of the U.S. Treasury, and shall collect and reinvest in the Gross Settlement Fund
all earnings accrued thereon. Any funds held by the Escrow Agent in an amount of less
than $250,000 may be held in a bank account or Certificates of Deposit insured by the
FDIC or may be invested as funds in excess of $250,000 are invested. The Parties agree
that the Gross Settlement Fund is intended to be a Qualified Settlement Fund within the
meaning of Treasury Regulation � 1.46813- 1, and that the Escrow Agent as administrator of
the Gross Settlement Fund within the meaning of Treasury Regulation � 1.468B-2(k)(3),
shall be responsible for filing tax returns and any other tax reporting for or in respect of the
Gross Settlement Fund and for paying from the Gross Settlement Fund the costs, fees,
expenses, awards and Taxes described in Paragraph 3.4. The Parties agree that the Gross
Settlement Fund shall be treated as a Qualified Settlement Fund from the earliest date
14
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 14 of 31 PAGEID #: 7979
possible, and agree to any relation-back election required to treat the Gross Settlement
Fund as a Qualified Settlement Fund from the earliest date possible. Defendants agree to
promptly provide to the Escrow Agent the statement described in Treasury Regulation �
1.468B-3(e).
3.4 The Gross Settlement Fund shall be used to pay (i) the costs referred to in
Paragraph 4.2(a); (ii) any Taxes pursuant to Paragraphs 3.4 and 4.2(b); (iii) any attorneys’
fees and expenses awarded to Plaintiffs’ Co-Lead Counsel by the Court pursuant to
Paragraph 5.1; and (iv) any case contribution awards awarded to the Class Representatives
and plaintiff Ebrahim Shanehchian by the Court pursuant to Paragraph 5.2. The balance of
the Gross Settlement Fund shall constitute the Net Settlement Fund. Defendants,
Defendants’ Counsel, the Released Parties, and Chartis shall have no obligation to pay any
monies towards the Settlement other than the Settlement Amount. To the extent any
additional and/or unanticipated costs or expenses are incurred in carrying out the
Settlement, such costs or expenses shall be deducted from the Gross Settlement Fund. All
Taxes shall be paid out of the Gross Settlement Fund, shall be considered to be a cost of
administration of the Settlement and shall be timely paid by the Escrow Agent without
prior order of the Court. The Escrow Agent shall, to the extent required by law, be
obligated to withhold from any distributions to any Person entitled thereto pursuant to this
Stipulation any funds necessary to pay Taxes, including the establishment of adequate
reserves for Taxes as well as any amount that may be required to be withheld under
Treasury Regulation � 1.468B-(I)(2) or otherwise under applicable law in respect of such
distributions. Plaintiffs’ Co-Lead Counsel shall provide to Defendants’ Counsel copies of
15
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 15 of 31 PAGEID #: 7980
all tax returns filed with respect to the Gross Settlement Fund promptly upon the filing
thereof, and evidence of the payment of Taxes as and when all such payments are made.
3.5 After the Effective Date and after payment of all costs, awards and Taxes
described in Paragraph 3.4, the Net Settlement Fund shall be transferred and/or distributed
by the Escrow Agent in accordance with the approved Plan of Allocation.
3.6 None of the Defendants, Defendants' Counsel, the Released Parties or
Chartis shall have any responsibility for or liability whatsoever with respect to (i) any act,
omission or determination of Plaintiffs' Co-Lead Counsel or the Settlement Administrator,
or any of their respective designees, agents or employees, in connection with the
administration of the Settlement or otherwise; (ii) the identification of addresses for, or the
mailing of notices to, the Class Members; (iii) the management, investment or distribution
of the Settlement Fund; (iv) the formulation, design or terms of the Plan of Allocation or
any calculations performed pursuant thereto; (v) the determination, administration,
calculation or payment of any claims asserted against the Settlement Fund; (vi) any losses
suffered by, or fluctuations in the value of, the Settlement Fund; or (vii) the payment or
withholding of any Taxes, expenses and/or costs incurred in connection with the taxation
of the Settlement Fund or the filing of any returns. Further, the Gross Settlement Fund
shall indemnify and hold Defendants, Defendants' Counsel, the Released Parties and
Chartis harmless for any loss or liability of any kind arising, directing or indirectly, out of
any of the acts, omissions or circumstances described in this Paragraph 3.6, as well as for
reasonable attorneys' fees incurred in connection with efforts to enforce this indemnity and
any taxes payable by reason of any such indemnification payments.
16
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 16 of 31 PAGEID #: 7981
4. ADMINISTRATION
4.1 The Settlement Administrator shall administer the Settlement subject to the
jurisdiction of the Court.
4.2 Following entry of the Order for Notice and Hearing, the Escrow Agent
may pay from the Gross Settlement Fund, without further approval from the Court or
Defendants, (a) all reasonable costs and expenses associated with effecting mailing of the
Mail Notice, responding to requests for the Long-Form Notice and effecting publication of
the Publication Notice as ordered by the Court, including without limitation, the actual
costs of printing and mailing the Mail Notice and Long-Form Notice and publication of the
Publication Notice, and (b) all Taxes. In the event that the Settlement is terminated, the
amounts expended pursuant to this Paragraph 4.2 shall not be returned to Chartis.
4.3 Defendants shall cooperate in the administration of the Settlement to the
extent reasonably necessary to effectuate its terms and not otherwise prohibited by law,
including by providing without charge information that is reasonably available to them to
assist the Settlement Administrator in identifying the Class Members and the transactions
in the Plans necessary to carry out the terms of the Settlement. The information will be
provided to the Settlement Administrator in an electronic form, to the extent it exists in
such a format or can otherwise be readily obtained.
4.4 On the timetable and in the manner set by the Court in the Order for Notice
and Hearing, the Settlement Administrator shall cause the Mail Notice to be sent to all
members of the Class.
17
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 17 of 31 PAGEID #: 7982
4.5 Defendants shall serve the CAFA Notices at their own expense within ten
(10) days after this Stipulation is filed with the Court in accordance with CAFA, and file
proof thereof with the Court.
5. ATTORNEYS' FEES AND EXPENSES
5.1 Plaintiffs' Co-Lead Counsel will apply to the Court for an award, to be paid
out of the Gross Settlement Fund, of no more than thirty percent (30%) of the Settlement
Amount for Plaintiffs' attorneys' fees, plus reimbursement of their reasonable expenses,
plus interest on the amount awarded from the date the Settlement Fund was funded to the
date of payment to Plaintiffs' Co-Lead Counsel at the same net rate that the Settlement
Fund earns. Any amount awarded by the Court shall be payable by the Escrow Agent
immediately upon entry of the order making the award, notwithstanding the existence of
any timely-filed objections thereto, the potential for appeal therefrom, or any existing or
possible collateral attack on the Settlement or any part thereof provided, however, that if
the Settlement is terminated or the amount awarded by the Court pursuant to this Paragraph
is judicially reduced or reversed for any reason, Plaintiffs' Co-Lead Counsel shall, within
ten (10) business days, refund the Settlement Fund the amount to which Plaintiffs' Counsel
is no longer entitled, plus accrued interest on that amount at the same rate as is earned by
the Settlement Fund; and provided further that Plaintiffs' Counsel, other than Plaintiffs'
Co-Lead Counsel shall, as a condition to receiving payment, execute an undertaking in a
form satisfactory to Plaintiffs' Co-Lead Counsel and Defendants' Counsel acknowledging
such refund obligation and providing adequate security therefor. Plaintiffs' Co-Lead
Counsel shall allocate any amount awarded by the Court pursuant to this Paragraph
EI1
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 18 of 31 PAGEID #: 7983
amongst Plaintiffs' Counsel in a manner in which they in good faith believe reflects their
respective contributions.
5.2 Plaintiffs' Co-Lead Counsel may also apply to the Court for case
contribution awards of no more than Five Thousand Dollars and No Cents ($5,000.00) to
each of the Class Representatives and of no more than One Thousand Dollars and No Cents
($1,000.00) to plaintiff Ebrahim Shanehchian for their respective contributions to the
prosecution and settlement of the Action. Any case contribution awards awarded by the
Court shall be paid out of the Gross Settlement Fund by the Escrow Agent within a
reasonable time after the Effective Date of the Settlement.
5.3 None of the Defendants, Defendants' Counsel, the Released Parties or
Chartis shall have any responsibility for or liability whatsoever with respect to (i) any
awards made by the Court pursuant to Paragraphs 5.1 and 5.2, which shall be payable
exclusively from the Gross Settlement Fund; or (ii) the allocation of any award made by the
Court pursuant to Paragraph 5.1 among Plaintiffs' Counsel. Further, the Gross Settlement
Fund shall indemnify and hold Defendants, Defendants' Counsel, the Released Parties and
Chartis harmless for any loss or liability of any kind arising, directing or indirectly, out of
the payment, non-payment or allocation of the awards described in this Paragraph 5.3, as
well as for reasonable attorneys' fees incurred in connection with efforts to enforce this
indemnity and any taxes payable by reason of any such indemnification payments.
6. TERMS OF ORDER FOR NOTICE AND HEARING
6.1 Promptly after this Stipulation has been fully executed, Plaintiffs' Co-Lead
Counsel and Defendants' Counsel shall request that the Court enter the Order for Notice
19
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 19 of 31 PAGEID #: 7984
and Hearing, which shall, among other things, certify the Class for purposes of the
Settlement only.
7. TERMS OF ORDER AND FINAL JUDGMENT
7.1 If the Settlement is finally approved by the Court, Plaintiffs' Co-Lead
Counsel and Defendants' Counsel shall request entry of the Judgment.
8. EFFECTIVE DATE OF SETTLEMENT, WAIVER OR TERMINATION
8.1 The "Effective Date" of the Settlement shall be the date as of which all the
following have occurred:
8.1.1 deposit into the Settlement Fund of the Settlement Amount in
accordance with the provisions of Paragraph 3.1.2;
8.1.2 final approval by the Court of the Settlement, following notice to the
Class and a hearing, as prescribed by Rule 23 of the Federal Rules of Civil Procedure;
8.1.3 entry by the Court of the Judgment in all material respects in the
form set forth in Exhibit B, and the Judgment becoming Final, or, in the event the Court
enters Judgment in a form other than that set forth in Exhibit B and none of the Parties
elects to terminate this Settlement pursuant to Paragraph 8.2 or 8.3, the date that such
Judgment becomes Final; and
8.1.4 if any of the circumstances described in Paragraphs 8.2 and 8.3
occur, the expiration of the time to exercise the termination right(s) provided therein
without any Party having done so.
20
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 20 of 31 PAGEID #: 7985
8.2 The Class Representatives and Defendants shall each have the right to
terminate the Settlement and thereby this Stipulation by providing written notice of their
election to do so to the other within thirty (30) days after any of the following occurs:
(a) the Court declining to enter the Order for Notice and Hearing in any material respect;
(b) the Court declining to approve the Settlement as set forth in this Stipulation in any
material respect; (c) the Court declining to enter Judgment as set forth in Paragraph 8.1.3;
or (d) the date upon which the Judgment is modified or reversed in any material respect by
any level of appellate court.
8.3 If the Defendants engage an Independent Fiduciary pursuant to Paragraph
10.5, Defendants shall also have the right to terminate the Settlement and thereby this
Stipulation by providing written notice of their election to do so to the Class
Representatives within thirty (30) days after receiving the report of the Independent
Fiduciary if the Independent Fiduciary has not approved the Settlement in accordance
with the Class Exemption or stated that, in the judgment of the Independent Fiduciary, the
Settlement would not constitute a prohibited transaction under Section 406 of ERISA; or
(ii) the Plans, acting by and through the Independent Fiduciary, have not agreed in writing
to grant the release set forth in Paragraph 2.2 upon the Effective Date.
8.4 Except as otherwise provided herein, in the event the Settlement is
terminated, the Parties shall be deemed to have reverted to their respective status in the
Action immediately prior to the execution of this Stipulation, and the Parties shall proceed
in all respects as if this Stipulation and any related orders had not been entered. None of
Parties waive their pre-settlement litigation positions. Furthermore, within ten (10)
business days following any termination of the Settlement, the Escrow Agent shall return
21
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 21 of 31 PAGEID #: 7986
to Chartis the Settlement Amount, together with any interest or other income earned
thereon or in respect thereof, less (I) any Taxes paid or due with respect to such income,(ii)
any reasonable costs of administration and notice actually incurred and paid or payable
from the Settlement Fund, and (iii) any Taxes paid or payable from the Settlement Fund.
9. NO ADMISSION OF WRONGDOING
9.1 This Stipulation, whether or not consummated, and any proceedings taken
pursuant to it:
9.1.1 shall not be offered or received against any of the Defendants or
Released Parties as evidence of, or construed as or deemed to be evidence of, any
presumption, concession, or admission by any of the Defendants or Released Parties with
respect to the truth of any fact alleged in the Action, the validity of any claim that has been
or could have been asserted in the Action or in any other litigation, or the deficiency of any
defense that has been or could have been asserted in the Action or in any other litigation, or
of any liability, negligence, fault, or wrongdoing on the part of any of the Defendants or
Released Parties;
9.1.2 shall not be offered or received against the Defendants or Released
Parties as evidence of a presumption, concession or admission of any fault,
misrepresentation or omission with respect to any statement or written document approved
or made by any of the Defendants or Released Parties;
9. 1 3 shall not be offered or received against the Defendants or Released
Parties as evidence of a presumption, concession or admission of any liability, negligence,
fault or wrongdoing on the part of any of the Defendants or Released Parties, or in any way
22
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 22 of 31 PAGEID #: 7987
referred to or used for any other reason as against any of the Defendants or Released Parties
in any other civil, criminal or administrative action or proceeding, other than such
proceedings as may be necessary to effectuate the provisions of this Stipulation; provided,
however, that if the Settlement is approved by the Court, the Defendants and Released
Parties may refer to it to effectuate the liability protection granted to them by this
Stipulation;
9.1.4 shall not be construed against any of the Parties as an admission or
concession that the consideration to be given hereunder represents the amount that could be
or would have been recovered after a trial in the Action; and
9.1.5 shall not be offered or received against any of the Class
Representatives or Class Members as evidence of, or construed as or deemed to be
evidence of, any presumption, concession, or admission by any of the Class
Representatives or Class Members with respect to the merit of any of the claims or
defenses that were or could have been asserted in the Action or the amount of damages that
could have been recovered in the Action.
10. MISCELLANEOUS PROVISIONS
10.1 All of the Exhibits attached hereto are hereby incorporated by reference as
though fully set forth herein.
10.2 If the Court requests or orders the Class Representatives or Defendants to
supply non-privileged information in their possession as part of the Court's review of the
Settlement, the Class Representatives and Defendants agree to promptly provide such
information to the Court.
23
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 23 of 31 PAGEID #: 7988
10.3 The Parties shall in good faith attempt to address any timely-filed objection
to the Settlement, any objection or concern raised by the Independent Fiduciary, and any
objection or concern raised by the Department of Labor, including, to the extent reasonably
necessary and practicable, by promptly supplying any non-privileged information in their
possession that has been reasonably requested.
10.4 In the event that (a)(i) a case is commenced under Title ii of the United
States Code as to any Defendant that contributed to the Settlement Amount or any insurer
that did so on any Defendant's behalf; or (ii) a trustee, receiver, conservator, or other
fiduciary is appointed with respect to any such Defendant or insurer under any similar law;
and (b) a court of competent jurisdiction enters a final order finding such contribution or
any portion thereof to be a preference, voidable transfer, fraudulent transfer or similar
transaction and requiring such contribution or portion thereof to be returned; and (c) such
amount is not promptly deposited into the Gross Settlement Fund by others, then, at the
election of Plaintiffs' Co-Lead Counsel, the Parties shall jointly move the Court to
terminate this Stipulation and to vacate the releases given and Judgment entered in favor of
the Defendants. Upon the granting of such motion, the Parties shall be restored to their
respective positions in the litigation as of the day this Stipulation was fully executed.
Plaintiffs' Counsel shall return any attorneys' fees and costs paid to them pursuant to this
Settlement, and any cash amounts in the Gross Settlement Fund shall be returned as
provided in Paragraph 8.4 above.
10.5 Should Defendants decide to engage an Independent Fiduciary to review
the Settlement, Defendants will not do so without the advance written consent of Plaintiffs'
Co-Lead Counsel, which consent shall not be unreasonably withheld. The Independent
24
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 24 of 31 PAGEID #: 7989
Fiduciary will make any and all determinations necessary to assess the applicability of the
Class Exemption and whether to issue the release set forth in Paragraph 2.2 on behalf of the
Plans. Defendants shall pay all fees and expenses of the Independent Fiduciary. All
Parties shall cooperate in providing information to the Independent Fiduciary as requested.
The report of the Independent Fiduciary's review of the Settlement will be submitted to the
Parties and shall be filed with the Court at least ten (10) days before the deadline for
objections to the Settlement.
10.6 The Parties intend for the Settlement to be a final and complete resolution of
all of the Settled Claims and Settled Defendants' Claims. Accordingly, the Parties agree
not to assert in any forum that the Action was brought by the Class Representatives or
defended by Defendants in bad faith or without a reasonable basis, or that any party
violated Rule 11 of the Federal Rules of Civil Procedure in the course of the prosecution,
defense, or settlement of the Action. The Parties further agree that the Settlement Amount
and the other terms of the Settlement were negotiated at arm's length in good faith by the
Parties, and reflect a settlement that was reached voluntarily after consultation with
experienced legal counsel.
10.7 This Stipulation may not be modified or amended, nor may any of its
provisions be waived, except by a writing signed by all Parties, their Successors-in-Interest
or their respective counsel.
10.8 The headings herein are used for the purpose of convenience only and are
not meant to have legal effect.
25
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 25 of 31 PAGEID #: 7990
10.9 The administration and consummation of the Settlement as embodied in this
Stipulation and its Exhibits shall be under the authority of the Court, and the Court shall
retain jurisdiction to decide the applications contemplated by Paragraphs 5.1 and 5.2 and to
enforce the terms of the Settlement.
10.10 The waiver by any Party of any breach of this Stipulation by any other Party
shall not be deemed a waiver of any other prior or subsequent breach of this Stipulation by
any Party.
10.11 This Stipulation and its Exhibits constitute the entire agreement among the
Parties concerning the Settlement of the Action, and no representations, warranties, or
inducements have been made by any Party concerning this Stipulation and its Exhibits
other than those contained and memorialized in such documents.
10.12 This Stipulation maybe executed in one or more counterparts, each of
which shall be deemed to be an original, but all executed counterparts and each of them
shall be deemed to be one and the same instrument.
10.13 This Stipulation binds and inures to the benefit of the Parties hereto, their
assigns, heirs, administrators, executors, and Successors-In-Interest.
10.14 The construction and interpretation of this Stipulation shall be governed by
federal law.
10.15 No part of this Stipulation or any of its Exhibits maybe construed more
strictly against any Party merely by virtue of the fact that such documents were drafted, in
whole or in part, by counsel for that Party, it being recognized that the Stipulation and its
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 26 of 31 PAGEID #: 7991
Exhibits are the result of arm's length negotiations between the Parties and that all Parties
contributed substantially and materially to their preparation.
1 0.1 6 Counsel for the Parties and any other Person executing this Stipulation, any
of its Exhibits, or any related documents, warrant and represent by doing so that they have
the full authority to do so and to take all appropriate action required or permitted to be
taken pursuant to the Stipulation to effectuate the terms of the Settlement.
10.17 The Parties agree to cooperate in good faith with one another in seeking
Court approval of the Settlement, including the Stipulation, its Exhibits and the Plan of
Allocation, and to promptly negotiate in good faith with respect to any other agreements or
documentation that may reasonably be required to obtain final approval of the Settlement
by the Court.
10.18 Any notice, demand, or other communication required to be given under
this Stipulation (other than the Mail Notice, Long-Form Notice, Publication Notice, or
other notice given at the direction of the Court) shall be in writing and shall be deemed duly
given upon receipt if it is addressed to each of the intended recipients as set forth below and
personally delivered, sent by registered or certified mail (postage prepaid), or delivered by
reputable express overnight courier:
IF TO THE CLASS REPRESENTATIVES:
Robert I. Harwood Daniella Quitt Samuel K. Rosen HAR WOOD FEFFER LLP 488 Madison Avenue New York, NY 10022
Lori G. Feldman Arvind B. Khurana Christopher J. Orrico MILBERG LLP One Penn Plaza NewYork,NY 10119-0165
27
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 27 of 31 PAGEID #: 7992
IF TO DEFENDANTS:
Brian T. Ortelere Jeremy P. Blunienfeld Erica E. Flores MORGAN, LEWIS & BOCK IUS LLP 1 701 Market Street Philadelphia, PA 19103-2921
J. Todd Kennard JONES DAY 325 John H. McConnell Boulevard Suite 600 Columbus, OH 43216-5017
Any Party may change the address at which it is to receive notice by written notice
delivered to the other Parties in the manner described above.
10.19 This Stipulation may he executed by exchange of faxed or scanned
executed signature pages, and any signature thereby transmitted for the purpose of
executing this Stipulation shall be deemed an original signature for purposes of this
Stipulation.
10,20 The date on which the final signature is affixed below shall be the date this
Stipulation is fully executed.
IN WITNESS WHEREOF, the Parties have executed this Stipulation on the dates set forth
below.
FOR THE CLASS REPRESENTATIVES AND THE CLASS:
DATED : / Stephen 111111111
KATZ, GREEN BERGER & NORTON, LLP 105 East 4th Street, 4th Floor Cincinnati, 011 45202 Phone: (513) 721-5151 Fax: (5 13) 621-9285 se [email protected]
P/a/ut//is' ' (,o-Le cud Counsel
28
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 28 of 31 PAGEID #: 7993
DATED:_________________ A k - At
Robert I. Harwd Daniel la Quitt Samuel K. Rosen HARWOOD FEFFER LLP 488 Madison Avenue New York, NY 10022 Phone: (212) 935-7400 Fax: (212) 753-3630 [email protected] dquitthfesq.com [email protected]
Plaintiff's Co-Lead Counsel
DATED: Lori G. Feldman Arvind B. Khurana Christopher J. Orrico MILBERG LLP One Penn Plaza New York, NY 10119-0165 Phone: (212) 594-5300 Fax: (212) 868-1229 lfeldmanmi1berg.com akhuranamilberg.com corricomi1berg.com
Plaintiffs' Co-Lead Counsel
Of Counsel
Alfred G. Yates, Jr. Gerald L. Rutledge LAW OFFICE OF ALFRED G. YATES JR., PC 519 Allegheny Building 429 Forbes Avenue Pittsburgh, PA 15219 Phone: (412) 391-5164 Fax: (412) 471-1033 [email protected]
29
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 29 of 31 PAGEID #: 7994
DATED: Robert I. Harwood Daniella Quitt Samuel K. Rosen HAR WOOD FEFFER LLP 488 Madison Avenue New York, NY 10022 Phone: (212) 935-7400 Fax: (212) 753-3630 rharwoodhfesq.com [email protected] srosenhfesq.com
Plain's Co-L d Counsel tiff
DATED:______ Lori G. Feldman Arvind B. Khurana Christopher J. Orrico MILBERG LLP One Penn Plaza New York,NY 10119-0165 Phone: (212) 594-5300 Fax: (212) 868-1229 lfeldmanmilberg.com akhuranami1berg.com corricomilberg.com
Plaintiffs' Co-Lead Counsel
Qf Counsel
Alfred G. Yates, Jr. Gerald L. Rutledge LAW OFFICE OF ALFRED G. YATES JR., PC 519 Allegheny Building 429 Forbes Avenue Pittsburgh, PA 15219 Phone: (412) 391-5164 Fax: (412)471-1033 [email protected]
29
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 30 of 31 PAGEID #: 7995
FOR DEFENDANTS
B4n T. Ortlere Jeremy P. Blumenfeld Erica E. Flares MORGAN, LEWIS & BOCKIUS LLP 701 Market Street
Philadelphia, PA 19103-2921 Phone: (2 15) 963-5000 Fax: (215) 963-5001 borte1eremorgan lewiscom j blumen Feld (�)rnorganlewiseom eflorcs(e7)iiioi-gaiilewis.coiii
Counsel foe De/'nciwiis
DATED: Todd Kennard
JONES DAY 325 John I-I. McConnell Boulevard Suite 600 Columbus, OH 43216-5017 Phone: (614) 281-3939 Fax: (614)461-4198 jtkennardjonesday.com
Counsel/hr Defndanis
OJCoi.insel
John M. Newman, Jr. Geoffrey J. Ritts .JONES DAY North Point 901 Lakeside Avenue Cleveland, OH 44114-1190 Phone: (216’) 586-3939 Fax: (216) 579-0212 jmnewman@jonesdaycom gjritts\ Iionesday,com
Counsel /or Defendants
30
Case: 1:07-cv-00828-SAS-SKB Doc #: 216 Filed: 11/14/12 Page: 31 of 31 PAGEID #: 7996
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
EBRAHIM SHANEHCHIAN, et al.,
Plaintiff, Case No. 1 :07-cv-00828-SAS-SKB
V. Judge S. Arthur Spiegel
MACY’S, INC. et al., Magistrate Judge Stephanie K. Bowman
Defendants.
FPROPOSED1 ORDER FOR NOTICE AND HEARING
This action involves claims for alleged violations of the Employee Retirement Income
Security Act of 1974, as amended, 29 U.S.C. � 1001 et seq. ("ERISA"), with respect to the
Macy’s, Inc. Profit Sharing 401 (k) Investment Plan and the May Department Stores Company
Profit Sharing Plan.
Presented to the Court is a proposed Settlement of the Action as against all Defendants.’
The terms of the Settlement are set out in the Stipulation executed by Plaintiffs’ Co-Lead
Counsel and Defendants’ Counsel, and its accompanying Exhibits, which are hereby
incorporated into this Order by reference.
The Court has considered the proposed Settlement to determine, among other things,
whether to certify the Class for settlement purposes and whether the Settlement is sufficient to
warrant the issuance of notice to the Class Members. Having done so, and the Parties to the
Stipulation having consented to the entry of this Order, it is hereby ORDERED, ADJUDGED,
AND DECREED as follows:
Capitalized terms not otherwise defined in this Order shall have the meaning ascribed to them in the Stipulation and Agreement of Settlement, dated November 14, 2012 (the "Stipulation").
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 2 of 30 PAGEID #: 7998
The Court has jurisdiction over the subject matter of the Action, the Class
Representatives, all members of the Class, and all Defendants pursuant to 29 U.S.C. � 1132(e).
2. The March 10, 2011 Order and Opinion certifying the Class is revised as follows
for settlement purposes only under Fed. R. Civ. P. 23(b)(1):
All individuals who were Participants in either the Macy’s Plan or the May Plan at any time between February 27, 2005 and July 24, 2012 whose Plan account included an investment in the Macy’s Company Stock Fund at any time during that period. The Class specifically excludes the Individual Defendants, their Immediate Family, and all current officers and directors of Macy’s.
3. The Court finds that the Class Representatives are adequate representatives of the
Class.
4. Under Fed. R. Civ. P. 23(g), the Court has considered: (a) the work class counsel
has done in identifying or investigating potential claims in this Action; (b) class counsel’s
experience in handling class actions, other complex litigation, and claims of the type asserted in
this Action; (c) class counsel’s knowledge of the applicable law and, in particular, its knowledge
of ERISA as it applies to claims of the type asserted in this Action; and (d) the resources class
counsel has committed to representing Plaintiffs and the Class. Based on these factors, the Court
finds that class counsel has and will continue to fairly and adequately represent the interests of
the Class with respect to the Settlement. Accordingly, the Court appoints Harwood Feffer LLP,
Milberg LLP, and Katz, Greenberger & Norton, LLP as co-lead counsel for the Class
("Plaintiffs’ Co-Lead Counsel")
5. 1-laying preliminarily determined that the Action may proceed as a non-opt-out
class action under Fed. R. Civ. P. 23(a) and (b)(1) for purposes of the Settlement, the Court
hereby orders that the Class Members shall be bound by any Judgment concerning the Settlement
upon final approval of the Settlement by the Court.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 3 of 30 PAGEID #: 7999
The Court finds that the proposed Settlement appears to be: (a) fair, reasonable,
and adequate as to all members of the Class; (b) the product of serious, informed, arm's length,
and non-collusive negotiations; (c) without obvious deficiencies; and (d) within the range of
possible final approval, and therefore directs that notice be given to the Class Members that,
pursuant to Fed. R. Civ. P. 23(e), the Court will hold a formal fairness hearing, at which
evidence may be presented in support of and in opposition to the proposed Settlement and after
which the Court will determine whether to finally approve the Settlement (the "Fairness
Hearing").
7. The Fairness Hearing is hereby scheduled to be held before the Court at
on , 2013, which is a date at least sixteen (16) weeks/one
hundred and twelve (112) days after entry of this Order, for the following purposes:
(a) to make a final determination as to whether the Action satisfies the
prerequisites for class action treatment under Fed. R. Civ. P. 23(a) and (b);
(b) to determine whether the proposed Settlement is fair, reasonable, and
adequate, and should be finally approved by the Court;
(c) to determine whether an Order of Final Judgment, substantially in the
form of Exhibit C to the Stipulation, should be entered, which would, among other things,
dismiss the Action with prejudice;
(d) to determine whether to approve the Class Members' release of the Settled
Claims as against the Released Parties, as set forth in the Stipulation;
(e) to determine whether the proposed Plan of Allocation for distribution of
the Net Settlement Fund to the Class Members is fair and reasonable, and should be approved by
the Court;
3
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 4 of 30 PAGEID #: 8000
(f) to consider Plaintiffs’ Co-Lead Counsel’s application for an award of
attorneys’ fees and reimbursement of expenses;
(g) to consider Plaintiffs’ Co-Lead Counsel’s application for case contribution
awards for the Class Representatives and plaintiff Ebrahim Shanehchian;
(h) to determine whether notice to the appropriate state and federal officials
was provided as required by, and whether Defendants satisfied their obligations under, the Class
Action Fairness Act of 2005 ("CAFA"), 28 U.S.C. � 1715; and
(i) to rule upon such other matters as the Settlement contemplates and as the
Court may deem just and proper.
8. The Court hereby approves, as to form and content, the Mail Notice and the Long-
Form Notice, attached hereto as Exhibits 1 and 2, respectively.
9. Within ten (10) days after entry of this Order, Defendants shall provide the
Settlement Administrator with all information necessary to send the Mail Notice to the Class
Members and shall reasonably cooperate with Plaintiffs’ Co-Lead Counsel in obtaining and
providing any other information necessary to accomplish the tasks required by this Order.
10. The Court hereby approves the selection of Berdon Claims Administration
LLC as the Settlement Administrator. Within three (3) weeks/twenty-one (21) days after
entry of this Order, the Settlement Administrator shall (a) send the Mail Notice, by first-
class mail, postage prepaid, to all Class Members who can be identified by the Parties
with reasonable effort at each such Class Member’s last known address, and (b) post the
Long-Form Notice, the Stipulation and its Exhibits, and this Order on the Settlement
Website, which shall be accessible to the public.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 5 of 30 PAGEID #: 8001
11. The Court hereby approves, as to form and content, the Publication Notice,
attached hereto as Exhibit 3, and directs Plaintiffs' Co-Lead Counsel to cause the Publication
Notice to be transmitted over PR Newswire within five (5) weeks/thirty-five (35) days after entry
of this Order.
12. At or before the Fairness Hearing, Plaintiffs' Co-Lead Counsel shall file with the
Court proof of timely compliance with the foregoing mailing and publication requirements.
13. All reasonable costs and expenses incurred in providing notice to the Class
Members shall be paid as set forth in the Stipulation, without further order of the Court.
14. The Court hereby finds that the form and content of the Mail Notice, the Long-
Form Notice, and the Publication Notice, and the methods set forth herein of notifying the Class
of the Settlement: (a) are appropriate, reasonable and constitute due, adequate, and sufficient
notice to all Persons entitled to receive such notice; and (b) constitute the best notice practicable
under the circumstances.
15. The Court will consider comments and/or objections to the Settlement, the
proposed Plan of Allocation and/or Plaintiffs' Co-Lead Counsel's applications for attorneys'
fees, expenses and case contribution awards only if such comments or objections are filed with
the Court on or before thirteen (13) weeks/ninety-one (9 1) days after entry of this Order, comply
with the requirements of Paragraph 17 below, and are served on the Parties at the following
addresses:
5
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 6 of 30 PAGEID #: 8002
FOR FILING WITH THE COURT:
Clerk of the Court U.S. District Court for the Southern District of Ohio Potter Stewart United States Courthouse 100 East Fifth Street Cincinnati, OH 45202 Re: ERISA Case No. 1 :07-cv-00828-SAS-SKB
TO PLAINTIFFS' CO-LEAD COUNSEL:
Lori U. Feldman Milberg LLP One Penn Plaza New York, NY 10119-0165
TO DEFENDANTS' COUNSEL:
Brian I. Ortelere Morgan, Lewis & Bockius LLP 1701 Market Street Philadelphia, PA 19103-2921
Robert I. Harwood Harwood Feffer LLP 488 Madison Avenue, 8"' Floor New York, NY 10022
J. Todd Kennard Jones Day 325 John H. McConnell Boulevard Suite 600 Columbus, OH 43216-5017
16. Defendants' Counsel and Plaintiffs' Co-Lead Counsel shall promptly furnish each
other with copies of any and all comments, objections and notices of intention to appear at the
Fairness Hearing that may come into their possession.
17. The Court will only consider comments and objections to the Settlement that are
timely filed with the Court and include all of the following: (a) the name of the Action; (b) the
objecting Class Member's full name, address, telephone number, and signature (an attorney's
signature is not sufficient); (c) a statement that the objector is a Class Member and an
explanation of the basis upon which the objector claims to be a Class Member; (d) all grounds
for the objection, accompanied by any legal support known to the objector or his counsel, (e) a
statement as to whether the objector or his counsel intends to personally appear and/or testify at
the Fairness Hearing; and (0 a list of any persons the objector or his counsel may call to testify at
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 7 of 30 PAGEID #: 8003
the Fairness Hearing in support of the objection. Any Class Member who does not timely file
and serve a written objection complying with these requirements shall be deemed to have
waived, and shall be forever foreclosed from raising, any objection to the Settlement. The
Parties may, at their own expense, take discovery, including depositions, from any Class
Member who files an objections with respect to any of the issues raised in the objection.
18. The report of any Independent Fiduciary retained to review the Settlement shall
be filed with the Court at least ten (10) days before the deadline for Class Members to file and
serve objections to the Settlement.
19. Plaintiffs' Co-Lead Counsel shall submit their papers in support of final approval
of the Settlement, the proposed Plan of Allocation, and Plaintiffs' Co-Lead Counsel's
applications for attorneys' fees, expenses, and case contribution awards at least three (3)
weeks/twenty-one (2 1) days before the deadline for Class Members to file and serve objections
to the Settlement. The Parties may submit papers in response to any timely-filed objections
and/or to the report of the Independent Fiduciary at any time before the Fairness Hearing.
20. The Court hereby finds that the draft CAFA Notices meet all requirements of
CAFA. At or before the Fairness Hearing, Defendants' Counsel shall file with the Court proof of
mailing of the CAFA Notices in accordance with CAFA.
21. The Fairness Hearing may be rescheduled by the Court without further notice to
the Class; provided, however, that the Settlement Administrator shall post an announcement of
the postponement and rescheduled date on the Settlement Website and shall mail a copy of the
corresponding docket entry to any Class Members who have timely filed objections to the
Settlement as of that date.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 8 of 30 PAGEID #: 8004
22. The Gross Settlement Fund shall constitute a Qualified Settlement Fund within
the meaning of Treasury Regulation � 1.46813-1.
23. The Court may consider modifications to the Settlement that are consented to by
the Class Representatives and the Defendants without further notice to the Class, unless
otherwise ordered by the Court.
24. The Court reserves the right to approve the Settlement without further notice of
any kind. The Court further reserves the right to enter its Judgment approving the Settlement
and dismissing the Action with prejudice before it has decided Plaintiffs’ Co-Lead Counsel’s
applications for attorneys’ fees, expenses and case contribution awards.
25. From the date of this Order through and including the date on which the Court
enters the Judgment or, alternatively, an order disapproving the Settlement, the Class
Representatives, the Class Members, and anyone acting on their behalf, are hereby enjoined from
asserting any Settled Claim against any Released Party in any action or proceeding in any forum.
26. The Court hereby stays all proceedings in the Action, other than those
proceedings necessary to carry out or enforce the terms and conditions of the Stipulation,
pending the Court’s decision with respect to final approval of the Settlement.
27. In the event that the Effective Date of the Settlement does not occur, this Order
shall become null and void, and shall be without prejudice to the rights of the Parties, all of
whom shall be restored to their respective positions existing as of the day the Stipulation was
fully executed. In such event, Paragraph 8.4 of the Stipulation shall govern the rights of the
Parties.
28. Under no circumstances shall this Order, the Stipulation and its Exhibits, or any
of their terms and provisions, the negotiations and proceedings connected therewith, or any of
M
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 9 of 30 PAGEID #: 8005
the documents or statements referred to therein, be construed, deemed or used as an admission,
concession or declaration by or against any of the Defendants of any fault, wrongdoing, breach
or liability. Nor shall this Order, the Stipulation and its Exhibits, or any of their terms and
provisions, the negotiations and proceedings connected therewith, or any of the documents or
statements referred to therein, be construed, deemed or used as an admission, concession or
declaration by or against any of the Class Representatives or Class Members that the claims
asserted or relief requested in the Action lacks merit, or is inappropriate, improper or
unavailable, or as a waiver by any of the Parties or Class Members of any defense or claim he,
she or it may have with respect to the Action.
29. The Court retains jurisdiction over all matters arising out of or related to
the Settlement.
SO ORDERED this day of , 2012.
The Honorable S. Arthur Spiegel United States District Judge
9
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 10 of 30 PAGEID #: 8006
Exhibit 1 to Exhibit A
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 11 of 30 PAGEID #: 8007
If your Macy's, Inc. Profit I Macy 's ERISA Litigation Settlement Sharing 401(k) Investment Plan Settlement Administrator and/or May Department Stores P.O. Box
Company Profit Sharing Plan CITY, ST ZIP
account included investments in I Macy's stock between February I 27, 2005 and July 24, 2012, you could be entitled to a payment <<Barcode>>
under a proposed class action Postal Service: Please do not mark barcode
settlement.
THIS NOTICE MA VA FFECT YOUR LEGAL RIGHTS. PLEASE READ IT
CAREFULLY.
This is an official court notice from the United States District Court for the Southern
District of Ohio, Western Division Shanehchian, et al. v. Macy 's Inc., et al., Case
No. 1 :07-cv-00828-SAS-SKB
<<ClaimID>> <<MailRec>>
((First l>) <<Lasti>>
<<Addr2>> <<Addrl>> <(City)>, <<ST>> <<Zip>> <<Country>>
This notice has been delivered to you to notify you of a proposed $8.5 million cash settlement of an ERISA class action.
Macy's records show that you are or were a participant in the Macy's, Inc. Profit Sharing 401 (k) Investment Plan and/or the May Department Stores Company Profit Sharing Plan (the "Plans") and that your Plan account(s) held investments in the Macy's Company Stock Fund between February 27, 2005 and July 24, 2012. As a result, you may be entitled to a payment pursuant to a proposed class action settlement in Shanehchian, et al. v. Macy 's Inc., et al., No. I :07-cv-00828-SAS-SKB (S.D. Ohio). In Shanehchian, the Plaintiffs claim that Macy's and certain other individuals and entities breached their fiduciary duties owed to the Plans under the Employee Retirement Income Security Act of 1974 ("ERISA") in connection with their administration of the Plans following Macy's acquisition of the May Department Stores Company in August 2005. Macy's denies any wrongdoing and has asserted many defenses, but the parties have reached agreement to settle the dispute and the proposed settlement is under review by the Court. As part of the proposed settlement, Macy's will provide payments to class members who show a loss under the proposed Plan of Allocation. You do not need to do anything to receive a payment under the settlement but your rights will be affected. The settlement includes a release of claims related to the administration of the Plans, the selection of investment options under the Plans, and disclosures about those investment options. The Court will hold a hearing on [MONTH & DAY], 2013, at XX:XX to consider whether to approve the settlement, the proposed Plan of Allocation, class counsel's application for up to 30% of the settlement amount in attorneys' fees and approximately $525,000 in expenses, and certain other matters. You cannot exclude yourself from the settlement. You can, however, file written comments or objections with the Court and appear and speak at the hearing at your own expense. To do so, your must submit your comments no later than [MONTH & DAY], 2013. Detailed instructions can be found on the Settlement Website at www. .com, where you can also obtain a more detailed notice about the terms of the settlement and how the payments will be calculated, as well as the settlement agreement and related materials. Additional information, including class counsel's application for attorneys' fees, will be posted on the Settlement Website as they are filed with the Court. You may also write to Macy's ERISA Litigation Settlement, P.O. Box , CITY, ST ZIP to request copies of these materials. This notice is only a summary.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 12 of 30 PAGEID #: 8008
Exhibit 2 to Exhibit A
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 13 of 30 PAGEID #: 8009
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
EBRAHIM SHANEHCHIAN, et al.,
Plaintiff, Case No. 1 :07-cv-00828-SAS-SKB
V. Judge S. Arthur Spiegel
MACY’S, INC. et al., Magistrate Judge Stephanie K. Bowman
Defendants.
NOTICE OF CLASS ACTION SETTLEMENT
To all members of the following class:
All participants in the Macy ’s, Inc. Profit Sharing 401 (l�) Investment Plan and/or the May Department Stores Company Profit Sharing Plan (the "Plans’) whose Plan account(s) held investments in the Macy ’s Company Stock Fund between February 27, 2005 and July 24, 2012 (the "Class’).
PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. A FEDERAL COURT AUTHORIZED THIS NOTICE.
THIS IS NOT A SOLICITATION.
If you are a member of the Class, your legal rights will be affected by a proposed settlement in a class action lawsuit entitled Shanehchian et al. v. Macy ’s Inc. et al., No. 1:07-cv-00828 (S.D. Ohio).
The settlement resolves a class action lawsuit over whether Macy’s and other individuals and entities alleged to be current or former fiduciaries of the Plans breached their fiduciary duties by violating the Employee Retirement Income Security Act of 1974, 29 U.S.C. � 1001, et seq. ("ERISA") with respect to the Plans’ investment options.
The proposed settlement will provide an $8.5 million settlement fund.
. The Court will hold a hearing on __________, 2013 to consider whether to approve the settlement and certain other related matters. If approved, the settlement would result in payments to qualifying members of the Class. See Question 11 below.
This Notice is intended to provide information about how this lawsuit and the proposed settlement may affect your rights and what steps you may take in relation to it. This
QUESTIONS? CALL () - TOLL FREE, OR VISIT www. . corn Do not call the Court or Macy’s with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 14 of 30 PAGEID #: 8010
Notice does not express the Court’s opinion on the merits of the claims or the defenses asserted in the lawsuit.
. If the settlement is approved, your legal rights will be affected whether you act or not. Please read this Notice carefully.
YOUR LEGAL RIGHTS AND OPTIONS
DO NOTHING You do not need to do anything in response to this Notice. If the settlement is approved by the Court and you are a member of the Class, you will receive whatever payment you may be entitled to under the settlement without having to file a claim or take any other action.
FILE AN OBJECTION If you want to submit comments or objections to the any aspect of the settlement, you may write to the Court and the parties’ attorneys. See Question 16 below.
GO TO A HEARING If you submit comments or objections to the settlement to the Court, you and/or your attorney may appear at the hearing and ask to speak to the Court. See Question 19 below.
. These rights and options - and the deadlines you must comply with to exercise them - are explained in detail in this Notice.
� The Court still has to decide whether to approve the settlement. Payments to Class Members will be made only if the Court approves the settlement and only after any appeals are resolved. Please be patient.
GENERAL INFORMATION
1. Why did I get this notice?
This Notice provides a summary of a class action lawsuit, the terms of a proposed settlement of that lawsuit, and the ways in which that settlement will affect the legal rights of those individuals who are members of the class.
You are receiving this Notice because you are a potential member of the Class. This means that you or someone in your family is or was a participant in the Macy’s, Inc. Profit Sharing 401(k) Investment Plan and/or the May Department Stores Company Profit Sharing Plan (together, the "Plans") whose Plan account(s) held investments in the Macy’s Company Stock Fund at some time between February 27, 2005 and July 24, 2012 (the "Class Period").
2
QUESTIONS? CALL LJ - TOLL FREE, OR VISIT www. .com Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 15 of 30 PAGEID #: 8011
The Court directed that this Notice be sent to potential members of the Class because they have a right to know about the proposed settlement of this lawsuit, and about all of their options before the Court decides whether to approve the settlement. If the Court approves the settlement, and after any appeals are resolved, the net settlement proceeds will be distributed pursuant to a Court-approved "Plan of Allocation."
2. What is this lawsuit about?
This class action lawsuit is called Shanehchian, et al. v. Macy 's Inc., et al., Case No. 1 :07-cv-00828-SAS-SKB (the "Action"). It is pending in the United States District Court for the Southern District of Ohio, Western Division, before District Judge S. Arthur Spiegel.
The people who brought the lawsuit are called plaintiffs. The Plaintiffs in this case are Anita Johnson, Donald Snyder, and Joseph Stengel. For purposes of the proposed settlement, they have been appointed to represent the Class and are therefore also known as the Class Representatives.
The people and entities the plaintiffs sued are called defendants. In this case, Macy’s, the committee responsible for administering the Plans and certain current and former directors and officers of Macy’ s are the Defendants.
On October 3, 2007, Ebrahim Shanehchian commenced this Action on behalf of a purported class of Plan participants. The Class Representatives later intervened as named plaintiffs and filed an Amended Complaint. They assert claims for various violations of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. �� 1001-1461, arising out of Defendants’ administration of the Plans following Macy’s acquisition of the May Department Stores Company in August 2005, including claims related to the prudence and performance of the Macy’s Common Stock Fund and the Plans’ other investment options, and claims related to Defendants’ disclosures to Plan participants about the Macy’s Common Stock Fund and the Plans’ other investment options.
The Complaint alleges that the Defendants were fiduciaries of the Plans and that they breached their fiduciary duties under ERISA by allowing the Plans to invest in Macy’s stock and by encouraging Plan participants to invest in Macy’s stock. The Complaint also alleges that the Defendants breached their fiduciary duties under ERISA by not prudently selecting other investment options for the Plans and by failing to disclose information about the fees and expenses of the Plans’ other investment options. The Complaint alleges that, as a result of Defendants’ ERISA violations, Plan participants suffered substantial losses of retirement savings and anticipated retirement income.
The Complaint asserts claims under ERISA for breach of the duty of prudence (Count I), failure to monitor (Count II), breach of fiduciary duty based on misrepresentations (Count III), breach of the duty of loyalty (Count IV), co-fiduciary liability (Count V), and prohibited transactions (Count VI). By this Action, Plaintiffs seek to recover the alleged losses for the Plans, as well as equitable, injunctive and other monetary relief, including attorneys’ fees.
3
QUESTIONS? CALL(__) - TOLL FREE, OR VISIT www. .com Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 16 of 30 PAGEID #: 8012
Macy's and the other Defendants deny the Plaintiffs' claims in the Action and have vigorously defended the litigation.
The case has been litigated in court for several years. On June 30, 2008, Defendants moved to dismiss the Complaint. Plaintiffs filed their opposition to the motion to dismiss on August 14, 2008. Defendants replied on September 15, 2008. After exchanges of supplemental authority by the Parties, the Court held a hearing on the motion to dismiss on September 24, 2008. On August 14, 2009, the Court denied Defendants' Motion to Dismiss.
On September 11, 2009, Defendants filed an Answer to the Complaint.
On October 13, 2009, Anita Johnson, Donald Snyder, and Joseph Stengel intervened as plaintiffs and class representatives with plaintiff Ebrahim Shanehchian. On December 9, 2009, the Court issued an opinion and order granting the motion to intervene.
Plaintiffs moved for class certification on October 13, 2009. Defendants filed their opposition under seal on December 14, 2009. Plaintiffs filed their reply under seal on February 16, 2010. After exchanges of supplemental authority by the Parties, the Court held a hearing on the class certification motion on January 12, 2011.
On March 10, 2011, the Court conditionally certified the Action as a class action pursuant to Fed. R. Civ. P. Rules 23(a) and 23(b)(1) and designated Anita Johnson, Donald Snyder, and Joseph Stengel to serve as class representatives and the law firms of Harwood Feffer LLP, Milberg LLP, and Katz, Greenberger & Norton, LLP to serve as co-lead class counsel. On May 18, 2011, the Defendants' Rule 23(f) petition was denied by the Sixth Circuit.
To date, Plaintiffs have produced documents to the Defendants and have been deposed. Defendants and third parties have produced in excess of 150,000 pages of documents that Plaintiffs' counsel have reviewed in their entirety. Plaintiffs' counsel have deposed several witnesses to date, including a consultant to the Plans and the expert Defendants presented in connection with their motion for partial summary judgment and partial judgment on the pleadings. The parties also engaged in expert discovery in connection with the class certification proceedings.
While the case was being litigated, the Parties tried to resolve the case over the course of a number of years. The parties began their first mediation on July 13, 2010, but were unable to reach an agreement. The parties were also unable to reach an agreement at a settlement conference the Court held on September 7, 2011.
On July 24, 2012, however, with the assistance of a nationally recognized mediator, Plaintiffs and Defendants reached an agreement to settle the Action. In doing so, the Defendants do not admit wrongdoing or liability of any kind.
3. Why is the Action a class action?
QUESTIONS? CALL(__) - TOLL FREE, OR VISIT www. . coni Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 17 of 30 PAGEID #: 8013
In a class action, one or more people sue on behalf of other people who have similar claims. All of the people who have similar claims make up a "class" and are referred to individually as "class members". Bringing a lawsuit as a class action allows the court to consider and resolve all at once many similar individual claims that might be economically too small to bring individually. The Action at issue here alleges wrongful conduct that affects a large group of people in a similar way. Accordingly, the Plaintiffs filed this case as a class action.
4. Why is there a settlement?
Plaintiffs and Defendants have agreed to settle the Action before Plaintiffs' claims are resolved by the Court. By agreeing to a settlement, both sides avoid the risks and costs of a trial, and the Class will benefit from the creation of an $8.5 million settlement fund. See Question 9 below. The terms of the proposed settlement are under review by the Court.
The Class Representatives and their attorneys, who are referred to in this Notice as "Plaintiffs' Co-Lead Counsel," think the settlement is fair, reasonable, and adequate. They also believe that the significant monetary benefits of the proposed settlement are an excellent result for the Class - especially given the possibility that Plaintiffs and the proposed class could otherwise recover nothing if the claims were resolved by the Court, the uncertainty of the law surrounding Plaintiffs' legal theories, the disputed issues of fact, and the likelihood that litigation of the Action would continue for many years.
5. How do I know if I am affected by the settlement?
Everyone who fits this description is a Class Member: All participants in the Macy's, Inc. Profit Sharing 401(k) Investment Plan and/or the May Department Stores Company Profit Sharing Plan whose Plan account(s) held investments in the Macy 's Company Stock Fund between February 27, 2005 and July 24, 2012.
6. Are any Plan participants excluded from the Class?
The Defendants, members of their immediate families, and all current officers and directors of Macy's are excluded from the Class. Additionally, Plan participants who did not hold an investment in the Macy's Company Stock Fund at some time between February 27, 2005 and July 24, 2012 are not members of the Class.
7. What if I am still not sure if I am included?
If you are still not sure whether you are a member of the Class, you can consult with an attorney of your own choosing or you can call 1-(j - or visit www. .com for more information. Please do not call the Court or Macy's.
5
QUESTIONS? CALL () - TOLL FREE, OR VISIT www. . corn Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 18 of 30 PAGEID #: 8014
8. Can I get exclude myself from the Class?
In some class actions, class members have the opportunity to exclude themselves from a settlement. This is sometimes referred to as "opting out" of the class. Here, you do not have the right to exclude yourself from the Class. Because of the way ERISA operates, some breach of fiduciary duty claims must be brought by participants on behalf of the Plans themselves, and any judgment or resolution necessarily applies to all Plan participants and beneficiaries. As such, it is not possible for any individual participant or beneficiary to exclude himself or herself from the Class. You will be bound by any judgments or orders that are entered in the Action, whether favorable or unfavorable.
THE SETTLEMENT BENEFITS
9. What does the proposed settlement provide?
As part of the proposed settlement, Defendants have agreed to create an $8.5 million settlement fund. After payment of the costs associated with administering the settlement fund, associated taxes, any award to Plaintiffs' Co-Lead Counsel for attorneys' fees and expenses, and any awards to the Class Representatives for their contributions to the Action, the balance of the settlement fund will be distributed to the Plan accounts of qualifying Class Members in accordance with a Court-approved "Plan of Allocation." The proposed Plan of Allocation is discussed in Question 11 below. If necessary, a Plan account will be created for qualifying members of the Class who no longer have Plan accounts.
110. How do I get a payment?
You do not need to file a claim or take any other action to receive a payment in connection with the proposed settlement. If you are a Class Member and you qualify to receive a share of the settlement fund under the Plan of Allocation, your share will be deposited into your Plan account.
Payments to Class Members who are current Plan participants will be credited to their existing Plan accounts and allocated in accordance with their existing investment elections. Current Plan participants may reallocate their settlement payment if and as permitted by the Plans.
Payments to Class Members who liquidated their Plan accounts after March 27, 2005 but before the "Effective Date" of the proposed settlement will be credited to a new Plan account established for them by the Plan trustee and allocated in their entirety to the Plan's current default investment option. Former Plan participants will receive notice that the new Plan account has been established along with further instructions.
All payments to the Class Members will be made as promptly as possible after all costs, taxes and other required disbursements are taken out of the settlement fund and the balance is transferred to the Plans. Please be patient.
6
QUESTIONS? CALL () - TOLL FREE, OR VISIT www. .com Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 19 of 30 PAGEID #: 8015
If any of the following applies to you, please contact the Settlement Administrator as soon as possible: (1) your status as a current Plan participant has recently changed or may change in the near future; (2) your mailing address has recently changed or may change in the near future; or (3) you did not receive a mailed notice of the proposed settlement but believe that you are a Class Member. The Settlement Administrator can be contacted at: Macy's ERISA Litigation Settlement, do [TBD].
11. How much will my payment be?
Your share of the settlement fund will be calculated as part of the implementation of the Settlement pursuant to a Court-approved Plan of Allocation summarized herein and available at www. .com. The amount of your payment, if any, will depend on the amount of your "Recognized Claims," as calculated pursuant to the Plan of Allocation, and how that amount compares to the Recognized Claims of the other Class Members. Whether you have a Recognized Claim under the Plan of Allocation depends on whether and when you bought and/or sold shares of the Macy's Company Stock Fund between Monday, February 28, 2005 and August 16, 2007. You are not responsible for calculating the amount you may be entitled to receive under the proposed settlement. This calculation will be done by the Settlement Administrator as part of the implementation of the settlement.
The summary below is not intended to be either an estimate of the amount that a qualifying Class Member might have been able to recover from Defendants after a trial of the Action. Given the factors above, and because the Court may require changes to the proposed Plan of Allocation before the settlement is approved, it is also not intended to be an estimate of the amount that will be paid to qualifying Class Members pursuant to the settlement if the settlement is approved by the Court.
Summary of the Proposed Plan of Allocation
The formula summarized below is the proposed basis upon which the balance of the settlement fund (after payment of costs, taxes, attorneys' fees and expenses) will be proportionately allocated to qualifying Class Members. Your payment, if any, will be equal to your proportionate share of the total Recognized Claims of all Class Members multiplied by the net settlement fund (subject to certain limitations, also described below). Your Recognized Claim will be calculated as follows:
1. The Recognized Claim for shares purchased between Monday, February 28, 2005 and May 9, 2007 and:
A. sold before the close of trading on May 9, 2007 is $0.00 (zero);
B. sold between May 10, 2007 and May 16, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $1.18 per share;
C. sold between May 17, 2007 and July 11, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $2.22 per share ($1.18 plus $1.04);
7
QUESTIONS? CALL ) - TOLL FREE, OR VISIT www. . corn Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 20 of 30 PAGEID #: 8016
D. sold between July 12, 2007 and August 15, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $4.20 per share ($1.18 plus $1.04 plus $1.98);
E. retained at the close of trading on August 15, 2007 is the lesser of: (1) the purchase price minus $30.33 per share or (2) $5.04 per share ($1.18 plus $1.04 plus $1.98 plus $0.84) or(3) zero ($0.00) if shares were sold on or after August 16, 2007 and the sale price exceeded the purchase price.
2. The Recognized Claim for shares purchased between May 10, 2007 and May 16, 2007 and:
A. sold before the close of trading on May 16, 2007 is $0.00 (zero);
B. sold between May 17, 2007 and July 11, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $1.04 per share;
C. sold between July 12, 2007 and August 15, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $3.02 per share ($1.04 plus $1.98);
D. retained at the close of trading on August 15, 2007 is the lesser of: (1) the purchase price minus $30.33 per share or (2) $3.86 per share ($1.04 plus $1.98 plus $0.84) or (3) zero ($0.00) if shares were sold on or after August 16, 2007 and the sale price exceeded the purchase price.
3. The Recognized Claim for shares purchased between May 17, 2007 and July 11, 2007 and:
A. sold before the close of trading on July 11, 2007 is $0.00 (zero);
B. sold between July 12, 2007 and August 15, 2007, is the lesser of: (1) the purchase price minus the sale price or (2) $1.98 per share;
C. retained at the close of trading on August 15, 2007 is the lesser of: (1) the purchase price minus $30.33 per share or (2) $2.82 per share ($1.98 plus $0.84) or (3) zero ($0.00) if shares were sold on or after August 16, 2007 and the sale price exceeded the purchase price.
4. The Recognized Claim for shares purchased between July 12, 2007 and August 15, 2007 and:
A. sold before the close of trading on August 15, 2007 is $0.00 (zero);
B. retained at the close of trading on August 15, 2007 is the lesser of: (1) the purchase price minus $30.33 per share or (2) $0.84 per share or (3) zero ($0.00) if shares were sold on or after August 16, 2007 and the sale price exceeded the purchase price.
QUESTIONS? CALL LJ - TOLL FREE, OR VISIT www. .com Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 21 of 30 PAGEID #: 8017
5. There is no Recognized Claim for shares that were purchased on or after August 16, 2007.
6, All negative Recognized Claims will be subtracted from positive Recognized Claims in order to determine the total Recognized Claim for each Class Member.
The Settlement Administrator shall next determine each Class Member's Net Market Loss. The Net Market Loss for each Class Member = A + B - C - D, where:
A = the dollar value of his or her investment in the Fund at the commencement of trading on Monday, February 28, 2005 (valued at $28.40 per share);
B = the dollar value of his or her new investments in the Fund during the period Monday, February 28, 2005 through August 15, 2007, valued at the time of transaction;
C = the dollar value of his or her dispositions of shares in the Fund during the period Monday, February 28, 2005 through August 15, 2007, valued at the time of transaction; and
D = the dollar value of his or her investment in the Fund at the close of trading on August 15, 2007 (valued at $30.33 per share).
To the extent a Class Member has a negative Net Market Loss, a market gain, the total Recognized Claim will be $0.00. To the extent that a Class Member has a Net Market Loss, but that loss was less than the total Recognized Claim, the Class Member's final total Recognized Claim will be limited to the Net Market Loss.
The Settlement Administrator shall determine each Class Member's Preliminary Individual Dollar Recovery. The sum of all Class Members' total Recognized Claims is the Total Recognized Claim of the Class as a whole (the "Class Claim"). The ratio of each Class Member's total Recognized Claims to the Class Claim equals his or her Recognized Claim Percentage. Each Class Member's Preliminary Individual Dollar Recovery equals the product of his or her Recognized Claim Percentage and the Net Settlement Fund.
The Settlement Administrator shall then identify all Former Plan Participants whose Preliminary Individual Dollar Recovery is less than or equal to $100.00 (the "De Minimis Amount"), who shall be deemed to have a Final Individual Dollar Recovery of $0.00.'
The Settlement Administrator shall then recalculate the Recognized Claim Percentages of the remaining Class Members by omitting from the calculation of the Class Claim the total
Subject to Court approval, the parties may agree to modify the De Minimis Amount at any time before entry of the Judgment based on information they may receive from the Plans' recordkeepers, the Trustee and/or the Settlement Administrator.
9
QUESTIONS? CALL () -
TOLL FREE, OR VISIT www. .com Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 22 of 30 PAGEID #: 8018
Recognized Claims of all Former Plan Participants whose Preliminary Individual Dollar Recoveries are equal to or less than the De Minimis Amount . Each remaining Class Member's Final Individual Dollar Recovery equals the product of his or her Recognized Claim Percentage and the Net Settlement Fund.
The foregoing is subject to applicable Plan accounts, participants who cannot be located, Relations Orders.
12. When would I get my payment?
provisions and procedures regarding inactive deceased participants and Qualified Domestic
The Court will hold a hearing on , 2013, to decide whether to approve the settlement. If the Court approves the settlement, there may be appeals. It is always uncertain whether these appeals can be resolved, and resolving them can take time, perhaps more than a year. It also takes time to make all the required calculations. For these reasons, a payment date cannot be provided at this stage. Please be patient. If for any reason the settlement is terminated, there will be no payments.
13. What am I giving up in exchange for the settlement payment?
Upon the "Effective Date" of the Settlement, all Class Members will release and forever discharge, and be forever enjoined from prosecuting, any "Settled Claims" (as defined below) against any of the "Released Parties" (as defined below) and will covenant not to sue any of the Released Parties with respect to any of the Settled Claims.
"Settled Claims" is defined in the proposed settlement agreement to mean "any and all claims, debts, demands, rights, causes of action, suits, matters, issues and liabilities (including, but not limited to, any and all claims for damages, interest, attorneys' fees, expert or consulting fees, and any other costs, expenses or liabilities whatsoever), whether based on federal, state, local, statutory or common law or any other law, rule or regulation, whether fixed or contingent, accrued or unaccrued, liquidated or unliquidated, at law or in equity, matured or unmatured, including both known claims and Unknown Claims, against any of the Released Parties that (a) were asserted in the Action, including, but not limited to, all claims relating to Macy's stock or the Macy's Company Stock Fund in the Plans, and all claims relating to the disclosure or non-disclosure of information with respect to Macy's stock, the Macy's Company Stock Fund, or any of the Plans' other investment options, during the Class Period; or (b) could have been asserted in the Action and relate to investments in Macy's stock, the Macy's Company Stock Fund, or any of the Plans' other investment options, including, but not limited to, all claims that relate to the prudence, fees, cost or performance of Macy's stock, the Macy's Company Stock Fund or any of the Plans' other investment options, at any time during the Class Period. Notwithstanding the foregoing, 'Settled Claims' does not include any claims, rights causes of action or liabilities (i) related to enforcement of the Settlement, including any claims related to the Parties'
10
QUESTIONS? CALL L) - TOLL FREE, OR VISIT www. .com Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 23 of 30 PAGEID #: 8019
obligations under this Stipulation and its Exhibits; or (ii) under the Securities Exchange Act of 1934, 15 U.S.C. �78a et seq., and the rules and regulations promulgated thereunder."
"Released Parties" is defined in the proposed settlement agreement to mean "the Defendants, every Person who, at any time during the Class Period, was a director, officer, employee or agent of Macy’s or a trustee or fiduciary of either of the Plans, together with, for each of the foregoing, their Predecessors, Successors-In-Interest, present and former Representatives, direct or indirect parents and subsidiaries, affiliates, insurers, co-insurers, re-insurers, consultants, administrators, employee benefit plans, investment advisors, investment bankers, underwriters, and any Person that controls, is controlled by, or is under common control with any of the foregoing."
The "Effective Date" will occur when the order entered by the Court approving the settlement becomes Final and not subject to appeal.
The above definitions include certain other terms that are separately defined in the proposed settlement agreement but are not reproduced here. For more information, please see the Stipulation and Agreement of Settlement dated November 14, 2012, available on the settlement website at www. .com.
THE LAWYERS REPRESENTING YOU
14. Do I have a lawyer in this case?
In its order directing distribution of notice to the Class Members and scheduling the upcoming hearing, the Court appointed the law firms of Harwood Feffer LLP and Milberg LLP in New York, NY and Katz, Greenberger & Norton, LLP in Cincinnati, OH to represent the Class. These lawyers are called Plaintiffs’ Co-Lead Counsel. The Class is also represented by the Law Offices of Alfred G. Yates, Jr. as of-counsel. If you want to be represented by your own attorney, you may hire one at your own expense.
15. How will the lawyers be paid?
The Court will determine the amount of any award to Plaintiffs’ Counsel, if any, to compensate them for their work on the Action and to reimburse them for associated expenses. Plaintiffs’ Co-Lead Counsel intend to ask the Court to award them up to thirty percent of the settlement amount in attorneys’ fees, plus reimbursement of approximately $525,000 in expenses, plus interest. Any award by the Court will be paid out of the settlement amount. You are not responsible for paying Plaintiffs’ Counsel.
Plaintiffs’ Co-Lead Counsel also intend to ask the Court to award case contribution awards of up to $5,000 to each of the Class Representative and of up to $1,000 to plaintiff Ebrahim Shanehchian for their contributions to the prosecution and settlement of the Action. Any such awards will be paid out of the settlement amount.
11
QUESTIONS? CALL LJ - TOLL FREE, OR VISIT www. . corn Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 24 of 30 PAGEID #: 8020
expenses and case .com
Copies of Plaintiffs' Co-Lead Counsel's applications for attorneys' fees, contribution awards will be available on the settlement website at www. before the objection deadline.
OBJECTING TO THE SETTLEMENT
You can tell the Court that you do not agree with the settlement or some part of it.
16. How do I tell the Court that I do not like the proposed settlement?
If you are a Class Member, you can tell the Court that you do not agree with the proposed settlement or some part of it, including the proposed Plan of Allocation, the request for attorneys' fees and reimbursement of expenses and/or the request for case contribution awards.
To object, you must send a letter or other writing stating that you object to the settlement in Shanehchian, et al. v. Macy Inc., et al., Case No. 1:07-cv-00828-SAS-SKB. Be sure to include the following: (i) the name of the Action; (ii) your full name, address, telephone number, and signature (an attorney's signature is not sufficient); (iii) a statement that you are a Class Member; (iv) all grounds for your objection, accompanied by any legal support known to you or your counsel; (v) a statement as to whether you or your counsel intends to appear and would like to speak at the hearing; and (vi) a list of any persons you or your counsel may call to testify at the hearing in support of your objection. Your objection must be submitted to the Court and sent to all the following counsel at the following addresses on or before 2013:
TO THE COURT:
Clerk of the Court United States District Court for the Southern District of Ohio, Western Division Potter Stewart United States Courthouse 100 East Fifth Street Cincinnati, OH 45202 Re: ERISA Case No. 1 :07-cv-00828-SAS-SKB
TO PLAINTIFFS' CO-LEAD COUNSEL:
Lori G. Feldman Milberg LLP One Penn Plaza New York, NY 10119-0165
TO DEFENDANTS' COUNSEL:
Robert I. Harwood Harwood Feffer LLP 488 Madison Avenue, 8thi Floor New York, NY 10022
12
QUESTIONS? CALL (_) - TOLL FREE, OR VISIT www. .com Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 25 of 30 PAGEID #: 8021
Brian T. Ortelere J. Todd Kennard Morgan, Lewis & Bockius LLP Jones Day 1701 Market Street 325 John H. McConnell Blvd., Suite 600 Philadelphia, PA 19103-2921 Columbus, OH 43216-5017
YOU DO NOT NEED TO GO TO THE HEARING TO HAVE YOUR WRITTEN OBJECTION CONSIDERED BY THE COURT. IF YOU DO FILE AN OBJECTION
WITH THE COURT, HOWEVER, YOU MAY APPEAR IN PERSON OR ARRANGE, AT YOUR EXPENSE, FOR A LAWYER TO REPRESENT YOU AT THE HEARING IN ACCORDANCE WITH THE INSTRUCTIONS AT QUESTION 19 BELOW. IF YOU DO FILE AN OBJECTION, YOU MAY BE SUBJECT TO DISCOVERY BY THE PARTIES TO THE ACTION ON THE ISSUES RELATED TO YOUR OBJECTION, INCLUDING
HAVING YOUR DEPOSITION TAKEN.THE COURT'S FAIRNESS HEARING
17. When and where will the Court decide whether to approve the proposed settlement?
The Court will hold a hearing to decide whether to approve the proposed settlement. This hearing is called a "Fairness Hearing." The Fairness Hearing will take place at ______ _.m. on , 2013, at the United States District Court for the Southern District of Ohio, Western Division, Potter Stewart United States Courthouse, 100 East Fifth Street, Cincinnati, OH 45202. At the Fairness Hearing, the Court will consider whether the settlement is fair, reasonable and adequate. The Court will also consider the proposed Plan of Allocation and the applications for attorneys' fees, expenses and case contribution awards. The Court will take into consideration any written objections filed in accordance with the instructions at Question 16. After the Fairness Hearing, the Court will decide whether to approve the settlement and whether to award any attorneys' fees, expenses and/or case contribution awards. We do not know how long these decisions will take.
The Court may change the date and time of the Fairness Hearing. If that happens, the Settlement Administrator will post the new date and time for the Fairness Hearing on the settlement website at www. .com and will notify any Settlement Class Members who have filed objections to the proposed settlement as of that date, but will not notify any other Settlement Class Members, including those who file objections after the Fairness Hearing is rescheduled. Accordingly, if you submit an objection to the Court and you or your counsel intends to attend the Fairness Hearing, please be sure to check the settlement website regularly to confirm the date and time.
18. Do I have to come to the hearing?
No. Plaintiffs' Co-Lead Counsel will answer any questions the Court may have about the proposed settlement, the proposed Plan of Allocation and the applications for attorneys' fees, expenses and case contribution awards. You and/or your counsel are welcome to attend the Fairness Hearing at your own expense, but you do not have to, even if you filed an objection.
13
QUESTIONS? CALL(__) - TOLL FREE, OR VISIT www. .com Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 26 of 30 PAGEID #: 8022
The Court will consider every timely-filed objection even if the objectors are not present at the Fairness Hearing.
19. May I speak at the hearing?
If you are a Class Member and you file an objection to the proposed settlement or any of its terms before the deadline and in accordance with the instructions at Question 16, you and/or your counsel may ask the Court for permission to speak at the Fairness Hearing. To do so, you must state in your written objection that you intend to appear and would like to speak at the Fairness Hearing. See Question 16 above.
IF YOU DO NOTHING
20. What happens if I do nothing at all?
You do not have to take any action in response to this Notice in order to participate in the settlement. If the settlement is approved by the Court, you will receive any payment to which you are entitled under the Court-approved Plan of Allocation. See Questions 9 through 12 above.
GETTING MORE INFORMATION
21. Where can I get more details about the proposed settlement?
This Notice summarizes the proposed settlement. The actual terms and conditions of the proposed settlement are set forth in the Stipulation and Agreement of Settlement dated November 14, 2012 (the "Stipulation"). You can get a copy of the Stipulation, as well as the Court's Order for Notice and Hearing, and Plaintiffs' Co-Lead Counsel's applications for attorneys' fees, expenses and case contribution awards (after they are filed) at www. .com or by writing to Plaintiffs' Co-Lead Counsel at the address above. All other papers that have been filed in the Action may be inspected at the Office of the Clerk of the Court of the United States District Court for the Southern District of Ohio, Western Division, Potter Stewart United States Courthouse, 100 East Fifth Street, Cincinnati, OH 45202, during regular business hours.
Dated: Cincinnati, Ohio 2012
By Order of the Court CLERK OF THE COURT
14
QUESTIONS? CALL LJ - TOLL FREE, OR VISIT www. . corn Do not call the Court or Macy's with your questions.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 27 of 30 PAGEID #: 8023
Exhibit 3 to Exhibit A
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 28 of 30 PAGEID #: 8024
Harwood Feffer LLP and Milberg LLP announce a proposed $8.5 million cash settlement of an ERISA class action on behalf of certain participants in the Macy's, Inc. Profit Sharing 401(k) Investment Plan and the May Department Stores Company Profit Sharing Plan
NEW YORK - (PR Newswire) - , 2012
In the United States District Court for the Southern District of Ohio, Western Division, in Shanehchian, et al. v. Macy 's Inc., et al., Case No. 1 :07-cv-00828-SAS-SKB, a summary notice has been issued as follows:
Summary Notice of Proposed Class Action Settlement and Scheduling of Final Fairness Hearing
To: All individuals who were participants in the Macy 's, Inc. Profit Sharing 401(k) Investment Plan and/or the May Department Stores Company Profit Sharing Plan at any time between February 27, 2005 and July 24, 2012 whose account included an investment in the Macy 's Company Stock Fund at any time during that period.
IF YOU ARE A MEMBER OF THE CLASS DESCRIBED ABOVE, YOUR RIGHTS WILL BE AFFECTED AND YOU MAY BE ENTITLED TO A PAYMENT FROM THE SETTLEMENT FUND. PLEASE READ CAREFULLY.
YOU ARE HEREBY NOTIFIED, pursuant to Rule 23 of the Federal Rules of Civil Procedure and an Order of the Court, that the above-referenced action has been certified as a class action for purposes of a proposed $8.5 million cash settlement, subject to review and final approval by the Court. As part of the proposed settlement, class members who show a loss under the proposed Plan of Allocation may be entitled to a payment from the settlement. You do not need to do anything to receive a payment under the settlement but your rights will be affected. The settlement includes a release of claims related to the administration of the Plans, the selection of investment options under the Plans, and disclosures about those investment options.
A hearing will be held before the Honorable S. Arthur Spiegel in the Potter Stewart United States Courthouse, 100 East Fifth Street, Cincinnati, OH 45202, at :_____ .m, on
2013 to determine whether the proposed settlement should be approved by the Court as fair, reasonable, and adequate, and to consider the proposed Plan of Allocation and class counsel's applications for attorneys' fees, expenses and case contribution awards.
You cannot exclude yourself from the settlement. You can, however, file written comments or objections with the Court. You or your lawyer may also appear and speak at the hearing at your own expense. To do so, you must send your comments and objections to the Court and the parties' attorneys no later than [MONTH & DAY], 2013. Detailed instructions can be found on the Settlement Website at www..com, where you can also obtain a more detailed notice about the terms of the settlement, how the existence of a qualifying loss will be determined and how the payments will be calculated, along with the settlement agreement and related materials. Additional information and materials, including class counsel's application for attorneys' fees, will be posted on the Settlement Website as they are filed with the Court. You
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 29 of 30 PAGEID #: 8025
may also write to Macy's ERISA Litigation Settlement, P.O. Box CITY, ST ZIP to request copies of these materials.
All other inquiries may be made by writing to class counsel at:
Robert I. Harwood Harwood Feffer LLP
488 Madison Avenue, 8th Floor New York, NY 10022 [email protected]
- and -
Lori G. Feldman Milberg LLP
One Penn Plaza New York, NY 10119
Published by Order of the U.S. District Court for the Southern District of Ohio.
CONTACT: Harwood Feffer LLP Robert I. Harwood, Esq., (212) 935-7400
Milberg LLP Lori G. Feldman, Esq., (212) 594-5300
2
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-1 Filed: 11/14/12 Page: 30 of 30 PAGEID #: 8026
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
EBRAHIM SHANEHCHIAN, et al.,
Plaintiff, Case No. 1 :07-cv-00828-SAS-SKB
V. Judge S. Arthur Spiegel
MACY’S, INC. et al., Magistrate Judge Stephanie K. Bowman
Defendants.
[PROPOSED] ORDER AND FINAL JUDGMENT
This Order and Final Judgment relates to the above-captioned action (the "Action")
brought by Anita Johnson, Donald Snyder, and Joseph Stengel (collectively, "Plaintiffs") against
Macy’s, Inc. and certain alleged fiduciaries of the Macy’s, Inc. Profit Sharing 401(k) Investment
Plan and the May Department Stores Company Profit Sharing Plan (together, the "Plans")
(collectively, "Defendants") for alleged violations of the Employee Retirement Income Security
Act of 1974, as amended, 29 U.S.C. � 1001 et seq. ("ERISA")
Plaintiffs and Defendants reached an agreement in principle to settle the Action on July
24, 2012. The Settlement was memorialized in the Stipulation and Agreement of Settlement,
dated November 14, 2012 (the "Stipulation"), entered into by Defendants and by Plaintiffs on
behalf of themselves, the Plans, and the Class (the "Parties").’
The Stipulation was filed with the Court on November 14, 2012. On
2012, the Court entered its Order for Notice and Hearing in which the Court for settlement
purposes only revised its March 10, 2011 Order and Opinion certifying the Class, found
Capitalized terms not otherwise defined in this Order shall have the meaning ascribed to them in the Stipulation.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 2 of 24 PAGEID #: 8028
Plaintiffs are adequate representatives of the Class, appointed class counsel as Plaintiffs’ Co-
Lead Counsel, preliminarily approved the Settlement as appearing to be fair, reasonable and
adequate, directed notice of the Settlement to the Class Members, and scheduled a Fairness
Hearing for the purposes set forth in Paragraph 7 of the Order for Notice and Hearing. The
Fairness Hearing was held on , 2013.
The Court has considered all matters submitted to it at the Fairness Hearing and has
received confirmation from Plaintiffs’ Co-Lead Counsel that the Mail Notice, Long-Form Notice
and Publication Notice were distributed as required by the Order for Notice and Hearing. Now,
therefore, it is hereby ORDERED, ADJUDGED, AND DECREED as follows:
1. The Court has jurisdiction over the subject matter of the Action, all members of
the Class, and all Defendants pursuant to 29 U.S.C. � 1132(e).
2. The Settlement was negotiated at arm’s length by experienced counsel who were
fully informed of the facts and circumstances of the Action and of the strengths and weaknesses
of their respective positions. The Settlement was reached after the Parties had engaged in
substantial discovery and extensive negotiations. Plaintiffs’ Co-Lead Counsel and Defendants’
Counsel were therefore well positioned to evaluate the benefits of the Settlement, taking into
account the expense, risk, and uncertainty of protracted litigation with respect to numerous
difficult questions of fact and law.
3. The Settlement was intended by the Parties to be a contemporaneous exchange of
value, and in fact constitutes such a contemporaneous exchange.
4. Notice of the Settlement, the proposed Plan of Allocation, and Plaintiffs’ Co-Lead
Counsel’s applications for attorneys’ fees, expenses and case contribution awards was given to
all Class Members who could be identified with reasonable effort in accordance with the Order
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 3 of 24 PAGEID #: 8029
for Notice and Hearing. Such notice constituted appropriate, reasonable and adequate notice to
all Class Members, met all applicable requirements of the Federal Rules of Civil Procedure, due
process, and any other applicable law, and was the best notice practicable under the
circumstances.
5. Defendants’ Counsel has filed proof of mailing of the CAFA Notices to
appropriate state and federal officials as required under the Class Action Fairness Act of 2005
("CAFA"), 28 U.S.C. � 1715. The CAFA Notices were timely served and meet all requirements
of CAFA. Defendants have therefore satisfied their obligations under CAFA.
6. The Settlement warrants final approval pursuant to Fed. R. Civ. P. 23(e)(2)
because it is fair, reasonable and adequate to the Class and others whom it affects based upon:
(1) the Plaintiffs’ likelihood of ultimate success on the merits balanced against the amount and
form of relief offered in settlement; (2) the complexity, expense and likely duration of the
litigation; (3) the stage of the proceedings and the amount of discovery completed; (4) the
judgment of experienced counsel who have competently evaluated the strength of their proofs;
(5) the nature of the negotiations that produced the Settlement; (6) the reaction of the Class; and
(7) the public interest.
7. The Settlement is therefore APPROVED as fair, reasonable and adequate to the
Class, and in the public interest. The Parties are directed to consummate the Settlement in
accordance with the terms of the Stipulation and its Exhibits, which are hereby incorporated into
this Order by reference.
The Court having certified the Class as a non-opt-out class under Fed. R. Civ. P.
23(a) and (b)(1), all Class Members are hereby bound by the Settlement.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 4 of 24 PAGEID #: 8030
9. The proposed Plan of Allocation is hereby APPROVED as fair, reasonable and
adequate, and is hereby incorporated into this Order by reference. The Escrow Agent is hereby
directed to disburse the Net Settlement Fund in accordance with the Stipulation and Plan of
Allocation. The Court finds the payments and distributions to be made pursuant to the Plan of
Allocation to be "restorative payments" as defined in IRS Revenue Ruling 2002-45. Any
modification or change to the Plan of Allocation that may hereafter be approved shall in no way
disturb or affect this Order and Final Judgment and shall be considered separate from this Order
and Final Judgment.
10. The Court finds that all Parties and their respective counsel have complied with
the requirements of Fed. R. Civ. P. 11 as to the initiation, prosecution and settlement of the
Action.
11. The Court hereby awards a case contribution award in the amount of
to each of the Class Representatives and a case contribution award in the amount
of $__________ to plaintiff Ebrahim Shanehchian. Such awards shall be paid out of the Gross
Settlement Fund in accordance with the Stipulation.
12. The Court hereby awards Plaintiffs' Co-Lead Counsel
% of the Gross
Settlement Fund in fees and $
in reimbursement of expenses, which
amounts the Court finds to be fair and reasonable. Such awards shall be paid out of the Gross
Settlement Fund in accordance with the Stipulation.
13. As required by Fed. R. Civ. P. 23(h)(3), the Court has considered and finds as
follows in making this award of attorneys' fees and expenses:
rd
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 5 of 24 PAGEID #: 8031
(a) The Settlement created a gross settlement fund of $8.5 million in cash,
plus interest, for distribution to the Plans, and numerous Class Members will benefit therefrom
pursuant to the Plan of Allocation;
(b) More than copies of the Mail Notice were sent to putative
Class Members notifying them that Plaintiffs' Co-Lead Counsel would be applying to the Court
for up to 30% of the settlement amount in attorneys' fees and $_________________ in expenses;
(c) __________ objections to the Settlement, the proposed Plan of Allocation
or Plaintiffs' Co-Lead Counsel's applications for attorneys' fees, expenses and case contribution
awards were timely filed by Class Members;
(d) Plaintiffs' Co-Lead Counsel conducted the litigation and achieved the
Settlement with skill, perseverance and diligent advocacy;
(e) The Action involved complex factual and legal issues, was actively
prosecuted for more than four years and, in the absence of a settlement, would have involved
further lengthy proceedings and an uncertain resolution;
(f) Had Plaintiffs' Co-Lead Counsel not achieved the Settlement there would
remain a significant risk that Plaintiffs and the class they sought to represent would recover less
or nothing from the Defendants;
(g) Plaintiffs' Counsel devoted over hours, with a lodestar value of
approximately $_ at the reasonable rate of $ per hour, to achieve the
Settlement; and
(h) The amount of attorneys' fees and expenses awarded by the Court is fair,
reasonable and consistent with such awards in similar cases.
5
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 6 of 24 PAGEID #: 8032
14. Without further order of the Court, the Parties may agree in writing to reasonable
extensions of time to carry out any of the requirements of the Settlement.
15. Upon the Effective Date of the Settlement, the Class Representatives, the Plans,
and the Class Members, on behalf of themselves and their Representatives, heirs, executors,
administrators, trustees, Predecessors, Successors-In-Interest, and assigns (in their capacities as
such), release and forever discharge and are forever enjoined from prosecuting any Settled Claim
against any of the Released Parties and covenant not to sue any of the Released Parties with
respect to any of the Settled Claims; provided, however, that no Released Party shall seek any
remedy for assertion of Settled Claims by any Class Member other than the Class
Representatives until at least thirty (30) days after providing such Class Member with written
notice of his or her release of, and the injunction against asserting, Settled Claims and
demanding such Class Member to desist from any conduct in violation thereof.
16. Upon the Effective Date of the Settlement, Defendants, on behalf of themselves,
the other Released Parties and their Representatives, heirs, executors, administrators, trustees,
Predecessors, Successors-In-Interest, and assigns (in their capacities as such) release and forever
discharge and are forever enjoined from prosecuting the Settled Defendants' Claims against the
Class Representatives, all members of the Class, and Plaintiffs' Counsel.
17. All claims that were asserted in the Action are hereby DISMISSED WITH
PREJUDICE, without further order of the Court, pursuant to the terms of the Stipulation.
18. Under no circumstances shall this Order, the Order for Notice and Hearing, the
Stipulation and its Exhibits, or any of their terms and provisions, the negotiations and
proceedings connected therewith, or any of the documents or statements referred to therein, be
construed, deemed or used as an admission, concession or declaration by or against any of the
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 7 of 24 PAGEID #: 8033
Defendants of any fault, wrongdoing, breach or liability. Nor shall this Order, the Order for
Notice and Hearing, the Stipulation and its Exhibits, or any of their terms and provisions, the
negotiations and proceedings connected therewith, or any of the documents or statements
referred to therein, be construed, deemed or used as an admission, concession or declaration by
or against any of the Class Representatives or Class Members that the claims asserted or relief
requested in the Action lacks merit, or is inappropriate, improper or unavailable, or as a waiver
by any of the Parties or Class Members of any defense or claim he, she or it may have with
respect to the Action.
19. In the event that the Effective Date of the Settlement does not occur, this Order
shall become null and void, and shall be without prejudice to the rights of the Parties, all of
whom shall be restored to their respective positions existing as of the day the Stipulation was
fully executed. In such event, Paragraph 8.4 of the Stipulation shall govern the rights of the
Parties.
20. The Court retains jurisdiction over all matters arising out of or related to the
Settlement.
SO ORDERED this day of 9 2013.
The Honorable S. Arthur Spiegel United States District Judge
7
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 8 of 24 PAGEID #: 8034
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
EBRAHIM SHANEHCHIAN, et al.,
Plaintiff, Case No. 1 :07-cv-00828-SAS-SKB
Judge S. Arthur Spiegel MACY'S, INC. et al., Magistrate Judge Stephanie K. Bowman
Defendants
[PROPOSED] PLAN OF ALLOCATION
Pursuant to Paragraph 3.5 of the Stipulation entered into by the Parties to the
Action, the Net Settlement Fund shall be transferred and/or distributed in accordance
with this Plan of Allocation.'
I. Allocation of the Net Settlement Fund to the Class
A. Within a reasonable time after the Effective Date, the Escrow Agent shall
transfer the Net Settlement Fund to the Macy's, Inc. Profit Sharing 401(k) Investment
Plan (the "Plan"). The Settlement Administrator shall then direct the Plan's record
keeper and/or trustee (the "Trustee") to allocate the Net Settlement Fund to the Class
Members as follows:
B. Current Plan Participants. For purposes of this Plan of Allocation, a
"Current Plan Participant" means a Plan participant whose Plan account has a balance
greater than zero. As promptly as possible after deposit of the Net Settlement Fund into
the Plan, the Trustee shall transfer into the Plan account of each Class Member who is a
Current Plan Participant his or her Final Individual Dollar Recovery, as defined in
Capitalized terms not otherwise defined in this Order shall have the meaning ascribed to them in the Stipulation and Agreement of Settlement, dated November 14, 2012 (the "Stipulation").
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 10 of 24 PAGEID #: 8036
Section II, in accordance with his or her existing investment elections then in effect.
Such Final Individual Dollar Recoveries shall be treated thereafter for all purposes under
the Plan as assets of the Plan properly credited to the Class Members' accounts and each
Class Member may reallocate his or her Final Individual Dollar Recovery if and as then
permitted by the Plan.
C. Former Plan Participants.
1. For purposes of this Plan of Allocation, "Former Plan Participant"
means (a) a Plan participant whose Plan account does not have a balance or has a balance
equal to zero; or (b) a participant in the May Department Stores Company Profit Sharing
Plan (the "May Plan") whose account did not have a balance or had a balance equal to
zero when the May Plan was merged into the Plan.
2. As promptly as possible after deposit of the Net Settlement Fund
into the Plan, the Trustee shall (a) open a new Plan account for each Class Member who
is a Former Plan Participant if his or her Preliminary Individual Dollar Recovery, as
defined in Section II, exceeds the De Minim is Amount, and (b) transfer into that new Plan
account his or her Final Individual Dollar Recovery, as defined in Section II, which shall
be allocated in its entirety to the Plan's current designated default investment option. The
Settlement Administrator shall notify each such Former Plan Participant of the opening of
his or her Plan account and provide additional information with respect to his or her
options under the Plan.
3. Class Members who are Former Plan Participants but whose
Preliminary Individual Dollar Recoveries are less than or equal to the De Minimis
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 11 of 24 PAGEID #: 8037
Amount shall be deemed to have a Final Individual Dollar Recovery of zero ($0.00) and
will therefore receive no part of the Net Settlement Fund.
II. Calculation of Allocation
A. Background: Calculation of the Preliminary Individual Dollar
Recoveries is based on the reaction of the price of Macy's common stock to certain
disclosures of information related to the allegations in the Amended Complaint These
disclosures were studied to determine the statistical significance of any accompanying
decline in Macy's stock price. Stock price reactions were measured using standard event
study methodology. Regression analysis was used to account for the effects of the larger
market and industry, leaving the residual return associated with each disclosure. If the
stock price reaction to a relevant disclosure was statistically significant, then the residual
return was used to calculate a Recognized Claim, as defined in Section B, for purposes of
this Settlement.
B. Recognized Claims
1. Statistically significant declines in Macy's stock price were made
by Macy's on May 10, 2007, May 17, 2007, July 12, 2007 and August 16, 2007, resulting
in four maximum Recognized Claims for purposes of this Settlement. To calculate the
amount of each maximum Recognized Claim, the residual return associated with each
disclosure was multiplied by the closing price of Macy's stock immediately prior to the
statistically significant decline. The resulting maximum Recognized Claims per share are
as follows:
a. May lO,2007:
b. May 17,2007: $1.04
3
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 12 of 24 PAGEID #: 8038
C. July 12, 2007: $1.98
d. August 16, 2007: $0.84
Total: $5.04
2. The amount of each Class Member's Preliminary Individual Dollar
Recovery depends on when he or she purchased and sold shares in the Macy's Company
Stock Fund (the "Fund") in his or her Plan or May Plan account. For example, a Class
Member who purchased shares in the Fund before May 10, 2007 and then sold those
shares after July 12, 2007 but before August 16, 2007 will have a maximum Recognized
Claim of $4.20 per share for those shares. By contrast, a Class Member who purchased
shares in the Fund before May 10, 2007 but also sold those shares before May 10, 2007
will have no Recognized Claim for those shares. There are no Recognized Claims for
shares held as of the beginning of the Class Period or, for May Plan participants, as of the
date Macy's acquisition of the May Department Stores Company closed or August 30,
2005.
C. Damage calculation formulas: Based upon the foregoing maximum
Recognized Claims, the Settlement Administrator shall determine each Class Member's
total Recognized Claim as follows:
1. The Recognized Claim for shares purchased between February 28, 2005 and May
9, 2007 and:
A. sold before the close of trading on May 9, 2007 is $0.00 (zero);
B. sold between May 10, 2007 and May 16, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $1.18 per share;
C. sold between May 17, 2007 and July 11, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $2.22 per share ($1.18 plus $1.04);
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 13 of 24 PAGEID #: 8039
D. sold between July 12, 2007 and August 15, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $4.20 per share ($1.18 plus $1.04 plus $1.98);
E. retained at the close of trading on August 15, 2007 is the lesser of: (1) the purchase price minus $30.33 per share or (2) $5.04 per share ($1.18 plus $1.04 plus $1.98 plus $0.84) or (3) zero ($0.00) if shares were sold on or after August 16, 2007 and the sale price exceeded the purchase price.
2. The Recognized Claim for shares purchased between May 10, 2007 and May 16,
2007 and:
A. sold before the close of trading on May 16, 2007 is $0.00 (zero);
B. sold between May 17, 2007 and July 11, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $1.04 per share;
C. sold between July 12, 2007 and August 15, 2007 is the lesser of: (1) the purchase price minus the sale price or (2) $3.02 per share ($1.04 plus $1.98);
D. retained at the close of trading on August 15, 2007 is the lesser of: (1) the purchase price minus $30.33 per share or (2) $3.86 per share ($1.04 plus $1.98 plus $0.84) or (3) zero ($0.00) if shares were sold on or after August 16, 2007 and the sale price exceeded the purchase price.
3. The Recognized Claim for shares purchased between May 17, 2007 and July 11,
2007 and:
A. sold before the close of trading on July 11, 2007 is $0.00 (zero);
B. sold between July 12, 2007 and August 15, 2007, is the lesser of: (1) the purchase price minus the sale price or (2) $1.98 per share;
C. retained at the close of trading on August 15, 2007 is the lesser of: (1) the purchase price minus $30.33 per share or (2) $2.82 per share ($1.98 plus $0.84) or (3) zero ($0.00) if shares were sold on or after August 16, 2007 and the sale price exceeded the purchase price.
5
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 14 of 24 PAGEID #: 8040
4. The Recognized Claim for shares purchased between July 12, 2007 and August
15, 2007 and:
A. sold before the close of trading on August 15, 2007 is $0.00 (zero);
B. retained at the close of trading on August 15, 2007 is the lesser of: (1) the purchase price minus $30.33 per share or (2) $0.84 per share or (3) zero ($0.00) if shares were sold on or after August 16, 2007 and the sale price exceeded the purchase price.
5. There is no Recognized Claim for shares that were purchased on or after August
16, 2007.
6. All negative Recognized Claims will be subtracted from positive Recognized
Claims in order to determine the total Recognized Claim for each Class Member.
D. The Settlement Administrator shall next determine each Class Member's
Net Market Loss. The Net Market Loss for each Class Member = A + B - C - D, where:
A = the dollar value of his or her investment in the Fund on the first day of the Class Period (valued at $28.40 per share);
B = the dollar value of his or her new investments in the Fund during the Class Period as of the time of purchase(s);
C = the dollar value of his or her sales of shares in the Fund during the Class Period as of the time of the sale(s); and
D = the dollar value of his or her investment in the Fund at the close of trading on August 15, 2007 (valued at $30.33 per share).
To the extent a Class Member had a negative Net Market Loss, a market gain, the total
Recognized Claim will be $0.00. To the extent that a Class Member had a Net Market
Loss, but that loss was less than the total Recognized Claim, the Class Member's final
total Recognized Claim will be limited to the Net Market Loss.
E. The Settlement Administrator shall determine each Class Member's
Preliminary Individual Dollar Recovery. The sum of all Class Members' total
ri
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 15 of 24 PAGEID #: 8041
Recognized Claims is the Total Recognized Claim of the Class as a whole (the "Class
Claim"). The ratio of each Class Member's total Recognized Claims to the Class Claim
equals his or her Recognized Claim Percentage. Each Class Member's Preliminary
Individual Dollar Recovery equals the product of his or her Recognized Claim Percentage
and the Net Settlement Fund.
F. The Settlement Administrator shall then identify all Former Plan
Participants whose Preliminary Individual Dollar Recovery is less than or equal $100.00
(the "De Minimis Amount"), who shall be deemed to have a Final Individual Dollar
Recovery of $0.00.2
G. The Settlement Administrator shall then recalculate the Recognized Claim
Percentages of the remaining Class Members by omitting from the calculation of the
Class Claim the total Recognized Claims of all Former Plan Participants whose
Preliminary Individual Dollar Recoveries are equal to or less than the De Minimis
Amount Each remaining Class Member's Final Individual Dollar Recovery equals the
product of his or her Recognized Claim Percentage and the Net Settlement Fund.
III. Qualifications and Continuing Jurisdiction
A. The Court will retain jurisdiction over the Plan of Allocation to the extent
necessary to ensure that it is fully and fairly implemented. In particular, the Court will
retain jurisdiction to evaluate the efforts of Plaintiffs' Co-Lead Counsel to identify and
notify Class Members who are entitled to receive a share of the Net Settlement Fund.
Plaintiffs' Co-Lead Counsel will report to the Court within a reasonable time of the
2 Subject to Court approval, the parties may agree to modify the De Minimis Amount at any time before entry of the Judgment based on information they may receive from the Plans' recordkeepers, the Trustee and/or the Settlement Administrator.
VA
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 16 of 24 PAGEID #: 8042
efforts that have been undertaken.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 17 of 24 PAGEID #: 8043
Jeremy P. Blumenfeld Partner 215.963.5258 jblumenfeld�morganlewis.com
November, 2012
VIA FEDERAL EXPRESS
The Honorable Eric H. Holder, Jr. Attorney General of the United States U.S. Department of Justice 950 Pennsylvania Avenue, NW Washington, D.C. 20530-0001
Re: Shanehchian et al. v. Macy's, Inc. et al., No. 07-00828 (S.D. Ohio), Notice Pursuant to 28 U.S.C. 1715
Dear Attorney General Holder:
Defendants Macy's, Inc., the Plan Committee for the Macy's, Inc. Profit Sharing 401(k) Investment Plan and the May Department Stores Company Profit Sharing Plan and other individual defendants (collectively "Defendants") hereby provide this Notice of a Proposed Class Action Settlement in the above-referenced class action pursuant to the Class Action Fairness Act of 2005 ("CAFA").
In accordance with their obligations under CAFA, Defendants enclose the following:
(1) The Complaint, any materials filed with the Complaint and any Amended Complaints.
Plaintiffs' Class Action Complaint for Violations of the Employee Retirement Income Security Act and Amended Class Action Complaint for Violations of the Employee Retirement Income Security Act of 1974, along with any and all Exhibits, can be found on the enclosed CD as Exhibits A and B.
(2) Notice of any scheduled judicial hearing in the class action.
The Court has yet to schedule a fairness hearing on the settlement. That hearing, when scheduled, will take place before U.S. District Judge S. Arthur Spiegel at the United States District Court for the Southern District of Ohio, Potter Stewart U.S. Courthouse, 100 E. Fifth
New York Philadelphia Washington Los Angeles San Francisco Miami Pittsburgh Princeton Chicago Palo Alto Dallas Houston Harrisburg Irvine Boston Wilmington London Paris Brussels Frankfurt Beijing Tokyo
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 19 of 24 PAGEID #: 8045
Morgan Lewis COUNSELORS AT LAW
Attorney General Holder November -, 2012 Page 2
Street, Cincinnati, Ohio 45202. Once it has been scheduled, Defendants will send a supplemental notice enclosing the Court order scheduling the hearing. Notice of the fairness hearing will be accessible online as follows: enter PACER through https://ecf.ohsd.uscourts.gov/ cgi-binlShowlndex.pl; click on "Query"; enter the civil case number 07-00828; click on the link "Run Query"; and then click on the link "Docket Report" or "History/Documents." The order will be found on the docket entry sheet.
(3) Any proposed or final notification to class members.
The Mail Notice, Long-Form Notice and Publication Notice (collectively, the "Class Notices") can be found on the enclosed CD as Exhibits 1 through 3 to Exhibit A (Proposed Order for Notice and Hearing) to Exhibit C (Stipulation and Agreement of Settlement). The Class Notices are final but for information that will be obtained and incorporated prior to their dissemination to the Class following entry of the Court's Order for Notice and Hearing. All of the Class Notices inform members of the Class that they do not have the right to exclude themselves from the Settlement.
(4) Any proposed or final class action settlement.
The Stipulation and Agreement of Settlement, and its Exhibits, can be found on the enclosed CD as Exhibit C. There is no other agreement that was contemporaneously made between class counsel and counsel for Defendants.
(5) A final judgment or notice of dismissal.
Final judgment has not yet been entered. Upon entry, the judgment will be accessible online as follows: enter PACER through https://ecf.ohsd.uscourts.gov/cgi-bin/Showlndex.pl; click on "Query"; enter the civil case number 07-00828; click on the link "Run Query"; and then click on the link "Docket Report" or "History/Documents." The judgment will be found on the docket entry sheet.
(6) Names of class members who reside in each state and the estimated proportionate share of the claims of such members to the entire settlement.
Exhibit D on the enclosed CD is a list of the names of individuals believed to be residing in each state who are expected to receive settlement proceeds.
Exhibit E on the enclosed CD is the estimated proportionate distribution of settlement proceeds by state, based on the Plan of Allocation, which can be found on the enclosed CD as Exhibit C to Exhibit C (Stipulation and Agreement of Settlement). Please note that the official distribution calculations will be performed and the distribution will be directed by the Plan Administrator.
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 20 of 24 PAGEID #: 8046
Morgan Lewis COUNSElORS AT LAW
Attorney General Holder November , 2012 Page 3
Once those calculations have been performed, Defendants will send a supplemental notice enclosing final distribution information. At present, however, we have no reason to believe the actual proportionate distribution of the proceeds to the class members by state, taken as a whole, will be significantly different from the estimate described above.
(7) Any written judicial opinion relating to the materials described in (3) through (5).
Neither the Court's order preliminarily approving the settlement nor its final judgment has yet been entered. Upon entry, these orders will be accessible online as follows: enter PACER through https://ecf.ohsd.uscourts.gov/cgi-binlShowlndex.pl; click on "Query"; enter the civil case number 07-00828; click on the link "Run Query"; and then click on the link "Docket Report" or "History/Documents."
If you have questions about this notice, the lawsuit, or the enclosed materials, please contact me.
Sincerely,
Jeremy P. Blumenfeld
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 21 of 24 PAGEID #: 8047
Jeremy P. Blumenfeld Partner 215.963.5258 jblumenfeldmorganlewis.com
November_, 2012
VIA FEDERAL EXPRESS
The Honorable [NAME] Attorney General of [STATE] [ADDRESS]
Re: Shanehchian et al. v. Macy 's, Inc. et al., No. 07-00828 (S.D. Ohio), Notice Pursuant to 28 U.S.C. � 1715
Dear Attorney General [NAME]:
Defendants Macy’s, Inc., the Plan Committee for the Macy’s, Inc. Profit Sharing 401 (k) Investment Plan and the May Department Stores Company Profit Sharing Plan and other individual defendants (collectively "Defendants") hereby provide this Notice of a Proposed Class Action Settlement in the above-referenced class action pursuant to the Class Action Fairness Act of 2005 ("CAFA").
In accordance with their obligations under CAFA, Defendants enclose the following:
(1) The Complaint, any materials filed with the Complaint and any Amended Complaints.
Plaintiffs’ Class Action Complaint for Violations of the Employee Retirement Income Security Act and Amended Class Action Complaint for Violations of the Employee Retirement Income Security Act of 1974, along with any and all Exhibits, can be found on the enclosed CD as Exhibits A and B.
(2) Notice of any scheduled judicial hearing in the class action.
The Court has yet to schedule a fairness hearing on the settlement. That hearing, when scheduled, will take place before U.S. District Judge S. Arthur Spiegel at the United States District Court for the Southern District of Ohio, Potter Stewart U.S. Courthouse, 100 E. Fifth Street, Cincinnati, Ohio 45202. Once it has been scheduled, Defendants will send a supplemental notice enclosing the Court order scheduling the hearing. Notice of the fairness
New York Philadelphia Washington Los Angeles San Francisco Miami Pittsburgh Princeton Chicago Palo Alto Dallas Houston Harrisburg Irvine Boston Wilmington London Paris Brussels Frankfurt Beijing Tokyo
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 22 of 24 PAGEID #: 8048
Morgan Lewis COUNSELORS AT LAW
Attorney General [NAME] November -, 2012 Page 2
hearing will be accessible online as follows: enter PACER through https://ecf.ohsd.uscourts.gov/ cgi-binlShowlndex.pl; click on "Query"; enter the civil case number 07-00828; click on the link "Run Query"; and then click on the link "Docket Report" or "History/Documents." The order will be found on the docket entry sheet.
(3) Any proposed or final notification to class members.
The Mail Notice, Long-Form Notice and Publication Notice (collectively, the "Class Notices") can be found on the enclosed CD as Exhibits 1 through 3 to Exhibit A (Proposed Order for Notice and Hearing) to Exhibit C (Stipulation and Agreement of Settlement). The Class Notices are final but for information that will be obtained and incorporated prior to their dissemination to the Class following entry of the Court's anticipated Order for Notice and Hearing. All of the Class Notices inform members of the Class that they do not have the right to exclude themselves from the Settlement.
(4) Any proposed or final class action settlement.
The Stipulation and Agreement of Settlement, and its Exhibits, can be found on the enclosed CD as Exhibit C. There is no other agreement that was contemporaneously made between class counsel and counsel for Defendants.
(5) A final judgment or notice of dismissal.
Final judgment has not yet been entered. Upon entry, the judgment will be accessible online as follows: enter PACER through https://ecf.ohsd.uscourts.gov/cgi-binlShowlndex.pl; click on "Query"; enter the civil case number 07-00828; click on the link "Run Query"; and then click on the link "Docket Report" or "History/Documents." The judgment will be found on the docket entry sheet.
(6) Names of class members who reside in each state and the estimated proportionate share of the claims of such members to the entire settlement.
Exhibit D on the enclosed CD is a list of the names of individuals believed to be residing in [STATE] who are expected to receive settlement proceeds.
Exhibit E on the enclosed CD is the estimated proportionate distribution of settlement proceeds by state, based on the Plan of Allocation, which can be found on the enclosed CD as Exhibit C to Exhibit C (Stipulation and Agreement of Settlement). As shown, settlement class members in [STATE] will receive an estimated % of the total settlement proceeds. Please note that the official distribution calculations will be performed and the distribution will be directed by the Plan Administrator. Once those calculations have been performed, Defendants will send a
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 23 of 24 PAGEID #: 8049
Morgan Lewis COUNSFLORS AT LAW
Attorney General [NAME] November -, 2012 Page 3
supplemental notice enclosing final distribution information. At present, however, we have no reason to believe the actual proportionate distribution of the proceeds to the class members in [STATE] will be significantly different from the estimate provided above.
(7) Any written judicial opinion relating to the materials described in (3) through (5).
Neither the Court's order preliminarily approving the settlement nor its final judgment has yet been entered. Upon entry, these orders will be accessible on-line as follows: enter PACER through https://ecf.ohsd.uscourts.gov/cgi-binlShowlndex.pl; click on "Query"; enter the civil case number 07-00828; click on the link "Run Query"; and then click on the link "Docket Report" or "History/Documents."
If you have questions about this notice, the lawsuit, or the enclosed materials, please contact me.
Sincerely,
Jeremy P. Blumenfeld
Case: 1:07-cv-00828-SAS-SKB Doc #: 216-2 Filed: 11/14/12 Page: 24 of 24 PAGEID #: 8050