The Alaska Retirement Management Board has filed suit against Mercer, alleging that the human resources consulting firm made a number of errors in its work as the state’s actuarial consultant. The Alaskan state agency, which is seeking $2.8 billion in damages, has accused Mercer of making “multiple errors” when it came to figuring the amount that should be set aside for health care and pension benefits. The agency has also alleged that company executives knew of the errors and covered them up.
Mercer, a division of Marsh & McLennan Companies Inc., could be hit with punitive damages as well as treble damages if Alaska wins the case. According to Marsh’s most recent quarterly filing, it has not “recorded a liability related to the Alaska case because it cannot determine ‘that a loss is both probable and reasonably estimable.'” According to the media reports, Mercer said in a statement that its error and its failure to disclose it was “a mistake in judgment that Mercer regrets and it is not consistent with the company’s corporate culture.” Mercer’s lawyers have argued that it did no “compensable harm” or damage to Alaska’s retirement systems. The judge overseeing the case has ordered a trial to be held in Juneau next July. It will be interesting to see how this lawsuit winds up.
Source: New York Times and Reuters
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