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Release Date: April 29, 2009
Release Number: 09-198-NEW/BOS 2009-123
Contact Name: John M. Chavez
Phone Number: 617.565.2075
New York – The U.S. Department of Labor has
filed two lawsuits asking the U.S. District Court for the Northern
District of New York to appoint independent fiduciaries to oversee the
abandoned profit-sharing plans of defunct H&M Tool & Machine Co.
Inc. and Valmar Industrial Corp., both formerly located in the
Binghamton, New York, area.
Each company sponsored a profit-sharing plan, and
these were under control of the same owner. Both plans had the same
fiduciary that stopped administering the plans when the companies went
out of business in 2004. As a result, the former employees who
participated in the profit-sharing plans were unable to access their
plan accounts.
Under the Employee Retirement Income Security Act (ERISA),
employee benefit plans must be managed by named fiduciaries. In the
absence of a plan fiduciary, participants and beneficiaries cannot
obtain plan information, make investments or collect retirement
benefits.
The Labor Department’s suits allege that the plans
have not filed legally required annual reports since 1994 nor provided
their participants with required summary plan descriptions. Since 2004,
participants and beneficiaries have not been able to obtain
distributions from either plan. As of May 29, 2007, the H&M Tool
plan had assets valued at $272,014 and the Valmar Industrial plan’s
assets were valued at $56,690. The custodian of the assets for both
plans is JP Morgan Chase Bank.
The department’s suits ask the court to appoint
independent trustees and fiduciaries to administer the plans, and either
distribute plan benefits or the assets if the plans are terminated to
eligible participants and beneficiaries.
“Even when companies fall on hard times,
fiduciaries of employee benefit plans cannot simply walk away from their
responsibilities to the participants and beneficiaries of those
plans,” said Jean Ackerman, director of the Boston office for the
Labor Department’s Employee Benefits Security Administration (EBSA),
which conducted the investigations that led to these suits. “We took
this legal action to ensure that these plans are properly managed so
that the participants can gain access to their retirement assets.”
Employers and workers can contact the Boston office
at 617.565.9600 or toll-free at 866.444.3272 for help with any problems
relating to private sector pension and health plans. In fiscal year
2007, EBSA achieved monetary results of $1.5 billion related to pension,
401(k), health and other benefits for millions of American workers and
their families. Additional information can be found at www.dol.gov/ebsa.
Secretary of Labor v. H&M Tool & Machine Co.
Inc. Profit-Sharing Plan
Civil Action Number: 3:09-CV-00499-DNH
Secretary of Labor v. Valmar Industrial Corp. Profit-Sharing Plan)
Civil Action Number: 3:09-CV-00498-DNH-DEP
U.S. Department of Labor news releases are accessible on the
Department's Newsroom
page. The information in this news release will be made available
in alternate format (large print, Braille, audio tape or
disc) from the COAST office upon request. Please specify which news release when
placing your request at 202.693.7828 or TTY 202.693.7755. The Labor Department is committed to providing America's employers and
employees with easy access to understandable information on how to comply
with its laws and regulations. For more information, please visit the
Department's Compliance
Assistance page.
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