The New England Biolabs, Inc. Employee Stock Ownership Plan (“the Plan”) was originally established as an employee stock ownership plan (“ESOP”) but, beginning in 2013, it ceased being an ESOP and was converted to a profit sharing plan. The Plan holds four types of investments: (1) mutual funds, (2) pooled separate accounts, (3) New England Biolabs (“NEB”) stock and (4) Cell Signaling Technology (“CST”) stock. A majority of the Plan’s assets before and after its conversion has been in equity holdings in NEB stock. Before the 2019 Amendment, former employees of NEB were allowed to remain as participants of the ESOP after they terminated employment or retirement (at least until age 65).

NEB adopted the Third Amendment to the Plan effective as of August 1, 2019 (“2019 Amendment”), which changed the terms of the Plan for former employee participants. The 2019 Amendment removed the ability of former employee participants to remain in the Plan and invested in NEB stock.

The Complaint alleges that the Plan fiduciaries breached their fiduciary duties and engaged in prohibited transactions by purchasing NEB stock from the Plan accounts of these former employees at prices that were not fair market value.

The Complaint alleges that, 2019 Amendment, and the subsequent liquation, Plaintiff and other members of the Subclass had their NEB stock involuntarily liquidated – not only at less than fair market value – but also lost their right to continue holding NEB stock and were denied the opportunity to benefit from future appreciation of NEB stock.

The Court has certified the following class:

All participants in the New England BioLabs Non-Voting Stock Ownership Plan whose NEB stock in their Plan account was liquidated (in whole or in part) between September 29, 2017 and December 31, 2021 – including all participants to whom NEB shares were distributed in kind (i.e. in the form of physical share certificates) between September 29, 2017 and September 30, 2019 and which were subsequently repurchased by NEB or the Plan before December 31, 2020 – and the beneficiaries of such participants, except the Excluded Persons.

“Excluded Persons” means the following persons who are excluded from the Class: (a) Defendants, (b) officers and directors of New England Biolabs, Inc., (c) any fiduciaries of the Plan at any time during September 2017 and December 30, 2021, (d) the beneficiaries of such persons or (e) the immediate family members of any of the foregoing, (f) any participant who previously settled claims alleged in the Amended Complaint, and (g) the legal representatives, successors and assigns of any such excluded persons.

The Complaint was filed on September 26, 2023.

Class Notice

Order Certifying Class & Granting Preliminary Approval of Class Action Settlement - April 21, 2025

Settlement Agreement

Plan of Allocation

Motion for Preliminary Approval of Class Action Settlement - April 14, 2025

Motion to Certify Class - April 14, 2025

Order on Motion to Dismiss - April 3, 2024

Amended Complaint - December 22, 2023

Complaint - September 26, 2023

New England Biolabs Gets Nod for $7.15 Million Stock Plan Pact, Bloomberg Law - April 22, 2025

Research Co. Inks $7.15M Deal To End Stock Plan Suit, Law360 - April 15, 2025

Plaintiffs and Defendants reached a settlement-in-principle on February 14, 2025. A formal settlement agreement was fully executed on April 14, 2025. Under the settlement, Defendants have agreed to pay $7.15 million to resolve the claims. After subtracting court-approved attorneys’ fees and expenses, and class representative service awards, the remaining amount of the $7.15 million total settlement will be distributed to participant Class members (and beneficiaries who would be entitled to payment under the terms of the Plan). 

The final fairness hearing will be held on August 6, 2025 at 2 p.m. at the United States District Court for the District of Massachusetts, John Joseph Moakley U.S. Courthouse, 1 Courthouse Way, Courtroom 21, Boston, Massachusetts 02210.