If you were a shareholder of The Necessity Retail REIT, Inc., you may be eligible to receive a payment from a recent class action settlement. These legal settlements occur when shareholders believe a company’s actions, such as a merger or a change in management structure, have negatively impacted the value of their investment. Understanding your rights and the steps required to file a claim is essential for recovering any funds you may be owed.
Understanding the Necessity Retail REIT Settlement
The Necessity Retail REIT, which formerly traded under the ticker symbol RTL and was previously known as American Finance Trust (AFIN), was a real estate investment trust focused on retail properties. In 2023, the company underwent a significant transformation by merging with Global Net Lease, Inc. (GNL). This merger also involved a process called “internalization,” where the company moved from being managed by an outside firm to having its own internal management team.
The settlement arises from allegations that certain disclosures made during this merger process were misleading or that the terms of the internalization were not in the best interest of the shareholders. While the companies involved often deny any wrongdoing to avoid a lengthy trial, they agree to a settlement to provide a resolution for the investors involved. This fund is now being distributed to eligible claimants who held shares during specific periods.
Who Is Eligible for the Settlement?
Eligibility for a class action settlement is strictly defined by the “Class Period.” This is the specific timeframe during which you must have owned or traded shares to be included in the legal action. For the Necessity Retail REIT settlement, eligibility generally extends to individuals and entities who purchased or held common stock during the transition and merger phase.
Determining Your Eligibility
- Review Your Brokerage Statements: Look for transactions involving RTL or AFIN between the dates specified in the official settlement notice.
- Check Your Ownership Status: You may be eligible if you held shares at the time the merger with Global Net Lease was finalized.
- Verify Exclusions: Usually, officers and directors of the companies involved are excluded from the settlement, as are those who specifically requested to be excluded from the class.
If you received a notice via mail or email, it is a strong indicator that records show you were a shareholder during the relevant period. However, even if you did not receive a notice, you can still submit a claim if you have the documentation to prove your share ownership.
How to File a Claim for Your Payment
Filing a claim is a straightforward process, but it requires attention to detail. Most settlements are managed by a third-party administrator who handles the paperwork and distribution of funds. You will need to provide proof of your investment to ensure your claim is approved.
Step 1: Gather Your Documentation
Before starting your application, collect all relevant brokerage statements. These documents must show the number of shares purchased, the dates of the transactions, and the price paid. If you held shares through multiple brokers, ensure you have records from each account.
Step 2: Access the Claim Form
Most settlement administrators provide an online portal where you can submit your claim electronically. This is often the fastest and most secure method. You can also request a paper form to be mailed to you if you prefer to submit your documentation via traditional mail.
Step 3: Complete the Form Accurately
The form will ask for your contact information, Social Security number or Taxpayer Identification Number, and a detailed history of your holdings in the REIT. Double-check all figures before submitting, as errors can lead to delays or the rejection of your claim.
Step 4: Submit Before the Deadline
Every class action settlement has a strict filing deadline. If you miss this date, you will lose your right to claim a portion of the settlement fund. Ensure your electronic submission is completed or your paper form is postmarked by the date listed in the official settlement instructions.
What to Expect After Filing
Once you submit your claim, the administrator must review thousands of applications. This process can take several months. The administrator will verify your share count against the records provided by the company and brokerage firms. If there is a discrepancy, they may reach out to you for additional information.
Timeline for Payment
Payments are typically not distributed until the court grants “Final Approval” to the settlement and all potential appeals are resolved. This means it could be six months to a year after the filing deadline before you receive your check or electronic deposit. The amount you receive will depend on the total number of valid claims submitted and the specific number of shares you held.
Tax Implications
Settlement payments may have tax implications depending on whether the payment is considered a return of capital or a capital gain. It is always a good idea to consult with a tax professional once you receive your payment to understand how to report it on your annual tax return.
Common Pitfalls to Avoid
Many shareholders miss out on their rightful payments because of simple mistakes. To ensure your claim is processed smoothly, keep the following tips in mind:
- Don’t Ignore the Notice: Many people mistake settlement notices for junk mail. Always open mail from settlement administrators to check for your unique Claimant ID.
- Update Your Address: If you move after filing your claim, notify the settlement administrator immediately so your check is sent to the correct location.
- Keep Copies of Everything: Save a copy of your completed claim form and all supporting documents. If your claim is lost or disputed, these records will be your only proof of submission.
- Watch for Scams: Legitimate settlement administrators will never ask you to pay a fee to file a claim. If a site asks for a payment to “process” your settlement, it is likely a scam.
Conclusion
Taking the time to file a claim for the Necessity Retail REIT settlement is a vital step in protecting your financial interests as an investor. While the individual payout may vary, participating in the settlement ensures that you receive your fair share of the recovery fund. By gathering your records and submitting your claim before the deadline, you can successfully navigate this process and move forward with confidence.
For more guidance on managing your investments and staying informed about consumer rights, explore our other articles on financial recovery and navigating complex legal processes. Being proactive today can lead to a more secure financial future tomorrow.