Jerry Schlichter, who has won $450 million for employees claiming retirement plan mismanagement, has Fidelity Investments Inc. scrambling over the possibility that he may call its chairman and CEO to testify in a case involving the Massachusetts Institute of Technology.
The plaintiffs, who are four participants in the school’s 401(k) plan, sued MIT in 2016, claiming it spent millions of dollars in excessive and unreasonable fees within Fidelity-administered accounts and offered imprudent investment lineups.
Schlichter, of St. Louis-based firm Schlichter Bogard & Denton, has included Fidelity Chairman and CEO Abigail Johnson on a preliminary list of witnesses he wants to call at trial, contending that she has direct knowledge of a quid-pro-quo arrangement between MIT and Fidelity involving donations to the university.
Johnson is on the MIT board, and Fidelity has given the university multi-million-dollar donations on several occasions, Schlichter said.
Fidelity, one of the world’s largest investment managers with $2.5 trillion under management, said Schlichter’s effort was a ”transparent attempt to harass Ms. Johnson and to attract media attention," according to a court filing requesting a protective order against a subpoena. The company said Johnson has "no "relevant testimony" and "lacks any knowledge" of the relevant facts.
Schlichter said the harassment and media attention allegations are “illogical” since the witness list was shared only with the defendants. Neither Fidelity nor Johnson is a defendant in the case, which is scheduled to go to trial in September.
Schlichter has brought similar suits against three dozen universities and companies. In April, he and his firm won $23.7 million settlement with health insurer Anthem Inc. In March, they won a $55 million settlement with ABB Inc. l