People who participated in the W.W. Grainger, Inc. Retirement Savings Plan at any time since May 12, 2019 would be paid automatically from plan records under the proposed $2.85 million Grainger 401(k) forfeiture settlement; there is no claim form to file. The settlement was submitted for preliminary approval on October 23, 2026 and has not been approved.
Current Status
The settlement has not been approved yet, and there is nothing to file. Plaintiffs filed a motion for preliminary approval on October 23, 2026, in the U.S. District Court for the Northern District of Illinois, before Judge Mary M. Rowland. If the court grants final approval, payments would be automatic: account credits for people with a plan account and checks for everyone else. There is no settlement website yet, and no payment date has been set.Free settlement alerts
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What Changed Recently?
On October 23, 2026, plaintiffs asked the court to preliminarily approve a $2.85 million settlement, certify a settlement class, approve the notice plan and appoint Analytics Consulting LLC as settlement administrator. The settlement agreement was signed the same day. The parties had mediated before Robert A. Meyer on July 28, 2026, reached an agreement in principle on August 4 and told the court on August 10.The case is Gardner-Keegan v. W.W. Grainger, Inc., No. 1:25-cv-05233, filed May 12, 2025. The plaintiffs claim the plan’s fiduciaries used forfeitures, the unvested employer contributions left behind when employees leave, to offset Grainger’s own contributions instead of first paying the plan’s reasonable administrative expenses. On January 26, 2026, the court dismissed the prohibited-transaction claims but let the fiduciary-breach claims proceed, reading the plan’s Section 8.4 as requiring forfeitures to be used for reasonable administrative expenses before offsetting employer contributions. Grainger and its Profit Sharing Investment Committee deny all liability, and the settlement is not an admission of wrongdoing.
Who Qualifies?
The proposed settlement class is everyone who participated in the W.W. Grainger, Inc. Retirement Savings Plan at any time from May 12, 2019 through the date the court enters a preliminary approval order. It includes the beneficiary of a deceased participant and the alternate payee of a participant subject to a qualified domestic relations order. The plaintiffs estimate the class at more than 30,000 people.How Much Could Class Members Get?
No per-person estimate has been published. The $2.85 million fund would pay, subject to court approval, attorneys’ fees of up to $950,000 (one-third of the fund), up to $60,000 in litigation costs and up to $10,000 for each of the three class representatives. If all of those were awarded in full, $1,810,000 would remain before administration expenses, taxes and any reserve are deducted.The remaining net amount would be divided by adding up each class member’s quarterly plan account balances, starting with the April to June 2019 quarter and ending with the quarter of preliminary approval. People with an active plan account would receive a credit to that account; people without one would receive a check. People without an active account whose initial share comes to $5 or less would be left out of the first distribution, with that money redistributed to others.
The plaintiffs told the court they estimate recoverable losses at about $14.25 million, including claimed lost investment earnings through the first quarter of 2026, so the $2.85 million settlement represents about 20% of that estimate.
What Proof or Notice ID Is Required?
None. The proposed plan of allocation uses plan records, and no claim form is required. Notice would go by email where a valid address is available, with a postcard by mail to everyone else and to anyone whose email bounces.What Is the Deadline?
There is no claim deadline because no claim is needed. The plaintiffs ask for certification under Rule 23(b)(1), which has no opt-out right. Class members could object to the settlement; under the proposed schedule, objections would be due 30 days before the final approval hearing, which would be held no earlier than 120 days after the October 23 motion. The court sets the actual dates if it grants preliminary approval.How Do Class Members Take Action?
Class members would not need to do anything to be paid. Under the proposed order, the settlement administrator would launch a settlement website within 30 days after preliminary approval, with the notice, the settlement agreement and the plan of allocation. Until then, the motion and settlement agreement are available on the court docket.What Happens Next?
The court will decide whether to grant preliminary approval. If it does, notice goes out, an independent fiduciary selected by the defendants reviews the settlement on the plan’s behalf and must issue a written determination at least 30 days before the final approval hearing, and the court then decides on final approval. Grainger would pay $100,000 into the settlement fund after preliminary approval and the remaining $2,750,000 within 21 days after the settlement becomes effective, following final approval and any appeals.Checks would expire after 180 days. If economically feasible, a second distribution would go pro rata to people who received an initial payment, and anything left would go to the plan to pay administrative fees and expenses that would otherwise be charged to participants. The class is represented by Walcheske & Luzi, LLC; the defendants are represented by Mayer Brown LLP.
Sources and Verification
- Memorandum in support of preliminary approval, ECF No. 44-1, Gardner-Keegan v. W.W. Grainger, Inc., No. 1:25-cv-05233 (N.D. Ill. October 23, 2026)
- Executed settlement agreement with exhibits, ECF No. 44-3 (October 23, 2026)
- Case docket — No. 1:25-cv-05233 (N.D. Ill.) (CourtListener)
Questions
What is the Grainger 401(k) forfeiture lawsuit about?
Gardner-Keegan v. W.W. Grainger, Inc., filed May 12, 2025 in federal court in Chicago, claims the fiduciaries of the W.W. Grainger, Inc. Retirement Savings Plan used forfeited employer contributions to reduce Grainger’s own contributions instead of first using them to pay the plan’s reasonable administrative expenses. Grainger and its plan committee deny all liability.
How would Grainger 401(k) settlement payments be calculated?
Under the proposed plan of allocation, each class member’s share of the net settlement fund is based on the sum of their quarterly plan account balances from the April to June 2019 quarter through the quarter of preliminary approval. People who still have a plan account would receive a credit to it; people without an active account would receive a check. No per-person estimate has been published.
Can Grainger plan participants opt out of the settlement?
The plaintiffs ask the court to certify the class under Federal Rule of Civil Procedure 23(b)(1), which does not provide opt-out rights. Class members would be able to object to the settlement before the final approval hearing, under deadlines the court would set if it grants preliminary approval.
How much of the Grainger settlement goes to attorneys’ fees?
Class counsel may ask for up to $950,000 in attorneys’ fees, one-third of the $2.85 million fund, plus up to $60,000 in litigation costs and up to $10,000 for each of the three class representatives, all subject to court approval. If every request were granted in full, $1,810,000 would remain before administration expenses and taxes.
What happens to unclaimed Grainger settlement money?
Checks would expire after 180 days. If it is economically feasible, a second distribution would go pro rata to people who received an initial payment. Money left after that would go to the plan, to be used only for administrative fees and expenses that would otherwise be charged to participants.
