Office of Administrative Law Judges 800 K Street, NW Washington, DC 20001-8002
DATE: January 19, 1993
IN THE MATTER OF
U.S. DEPARTMENT OF LABOR
PENSION AND WELFARE BENEFITS
ADMINISTRATION,
Complainant
v.
SCHMID EMPLOYEE PROFIT
SHARING PLAN,
Respondent
CASE No.: 92-RIS-16
ORDER DENYING MOTION TO DISMISS
This matter arises under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1132, 1135, the Secretary's Order 1-87, 52 Fed. Reg. 13,139, and the regulations issued thereunder at 29 C.F.R. §§ 2560, 2570.
On January 28, 1991, the Pension and Welfare Benefits Administration, U.S. Department of Labor ("PWBA"), issued a Notice of Intent to Assess a Penalty against Schmid Employee Profit Sharing Plan (the "Respondent"), for failure to attach a report from an independent qualified public accountant to the Respondent's 1988 5500 Form. On behalf of the Respondent, Mr. Sidney Goldberg, C.P.A., responded by letter to the PWBA on February 6, 1991. The PWBA then issued a Notice of Rejection against the Respondent for failure to provide material information in its annual report. Mr. Goldberg filed a revised annual report on September 19, 1991.
On November 18, 1991, the PWBA issued a Notice of Intent to Assess a Penalty in the amount of $50,000 pursuant to 29 C.F.R. § 2560.502c-2(e). This letter informed Mr. Goldberg that he had thirty days from the date of the Notice to file a written Statement of Reasonable Cause as to why the penalty should not be assessed. In response, Mr. Goldberg sent a letter dated December
[Page 2]
18, 1991, to PWBA requesting a hearing regarding the possible imposition of a penalty.
On March 5, 1992, the PWBA issued a Notice of Determination on Statement of Reasonable Cause which assessed a $50,000 penalty and informed the Respondent that it had thirty (30) days request a hearing with this Office. On April 9, 1992, Mr. Goldberg filed an answer requesting a hearing. This Office issued a Notice of Docketing on April 22, 1992, which required the parties to exchange certain information with one another and this Office. On May 22, 1992, the PWBA filed a Motion to Dismiss the Proceedings. The PWBA argued that the Respondent waived its rights to contest the $50,000 penalty pursuant to 29 C.F.R. § 2560.502c-2(f), because it had failed to submit a Statement of Reasonable Cause. On July 14, 1992 this Office issued an Order to Show Cause why the PWBA's motion to dismiss should not be granted. On August 14, 1992, Respondent filed a Memorandum in Response to the Order to Show Cause. On August 27, 1992, the PWBA also filed a Memorandum in Response to the Order to Show Cause.
On November 5, 1992, I issued an Order that denied PWBA's Motion to Dismiss and ordered the parties to submit their prehearing exchanges to this Office.
On November 19, 1992, PWBA submitted a Motion for Reconsideration of the November 5, 1992 Order and a brief in support of its Motion. PWBA subsequently submitted its Prehearing Exchange to this Office. The Respondent submitted a Reply to Complainant's Motion for Reconsideration accompanied by its Prehearing Exchange on December 10, 1992.
The issue before this Office is whether the PWBA's Motion for Reconsideration should be granted.
In its brief submitted on November 5, 1992, PWBA presented numerous arguments in support of its Motion for Reconsideration. However, none of the arguments that PWBA presented were new from those presented in its initial Motion to Dismiss, nor were any of the arguments meritorious. Accordingly, I find that PWBA failed to present any credible arguments in support of its Motion for Reconsideration.
[Page 3]
For the foregoing reasons, PWBA's Motion for Reconsideration is DENIED and the November 5, 1992 Order is AFFIRMED. Since both parties have submitted their prehearing exchanges, this matter will be set for hearing immediately.
