Eligible participants and beneficiaries of the North Highland employee stock ownership plan may receive an automatic payment from a proposed $2.375 million class action settlement. They do not have to file a claim to receive a check, but those who prefer a direct rollover need to make an election by November 5, 2026.
The lawsuit alleges that certain defendants breached fiduciary duties under the Employee Retirement Income Security Act in connection with transactions involving the plan. The allegations include claims that North Highland ESOP Holdings stock was improperly diluted during and after an October 2016 recapitalization.
The defendants deny the claims and say they acted prudently and in the interests of plan participants and beneficiaries. The court has not decided the merits, and the settlement is not an admission of fault.
The class is based on vested plan holdings
The settlement class includes participants in The North Highland Company Employee Stock Ownership Plan, formerly known as The North Highland Company Employee Stock Ownership and 401(k) Plan, and their beneficiaries, who held vested shares in North Highland ESOP Holdings, Inc. at any time from October 1, 2016 through May 30, 2025.
The individual defendants, their immediate families, and their legal representatives, successors and assigns are excluded. The official notice says a preliminary review identified 3,543 class members.
Individual distributions are not fixed. After court-approved legal fees and administrative expenses are deducted, the administrator will allocate the net fund pro rata using plan records and the number of shares or vested balances each member held during the class period.
A check is automatic, but a rollover requires action
Eligible members who do nothing will be sent a check if the settlement receives final approval and becomes effective. Because checks depend on the administrator having a current address, class members who have moved should update their mailing information through the official settlement site or administrator.
Checks are subject to automatic tax withholding and reporting as determined by the administrator. The notice cautions that the amount withheld may not cover every tax obligation associated with the payment.
Members may instead request a direct rollover to an individual retirement account or qualified employer plan that will accept it. The online rollover form is due November 5, 2026. A successful direct rollover is not subject to automatic withholding at distribution, although recipients should consult a tax professional about their circumstances.
If a requested rollover cannot be completed—for example, because information is incomplete or the receiving institution rejects it—the administrator will attempt to issue a check instead.
Class members cannot opt out
The settlement class was certified under Federal Rule of Civil Procedure 23(b)(1), so the notice says class members cannot exclude themselves. Objections must be filed and served by October 6, 2026.
The final approval hearing is scheduled for November 5, 2026 at 2 p.m. EST in Courtroom 1706 of the Richard B. Russell Federal Building, 75 Ted Turner Drive SW, Atlanta. The schedule or format can change, so class members should confirm current information on the official settlement website.
Payments will not be distributed unless the court grants final approval and the settlement becomes effective. The notice estimates distribution may occur within about four months after final approval if there are no appeals or unforeseen delays.