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News Release

For Immediate Release: August 15, 2011
Contact: Elizabeth Todd or Juan Rodriguez
Phone: 972-850-4710/972-850-4709
Email: Todd.elizabeth@dol.gov/Rodriguez.juan@dol.gov
Release Number: 11-1015-DAL

Pasadena, Texas-based Modern Plumbing and affiliates to restore workers' 401(k) contributions, resolving US Labor Department lawsuit

PASADENA, Texas – A consent judgment and order have been entered in federal district court requiring $28,504 to be restored to the Modern Plumbing Co. Inc. 401(k) Plan, resolving a lawsuit filed by the U.S. Department of Labor. The suit alleged that the following defendants violated the Employee Retirement Income Security Act: Modern Plumbing Co. Inc.; Modern Plumbing Supply Inc.; Modern Air Conditioning Inc., doing business as A/C Plus of Pasadena; and Albert Lloyd Hollub, one of the companies' majority owners.

An investigation by the department's Employee Benefits Security Administration led to the suit, which alleged that employee contributions made between Jan. 7, 2005, and Dec. 26, 2008, were not timely segregated and remitted to the plan by the defendants. The investigation also found that the defendants misused plan assets for the benefit of the companies.

The defendants agreed to a judgment that orders the following relief: They must restore all plan losses with interest, totaling $28,504; be enjoined from violating ERISA in the future; appoint an independent fiduciary as a successor to administer the plan; be permanently barred from serving as fiduciaries or service providers to any plan governed by ERISA in the future, once their successor is place; and pay a penalty to the government for the ERISA violations that is equal to 20 percent of the amount to be restored to the plan.

"Plan officials have a duty to manage and protect employees' benefit plans and their assets," said Roger Hilburn, director of EBSA's Dallas Regional Office. "The action taken is designed to restore plan assets that were not properly preserved for the company's workers."

Modern Plumbing Co. provides industrial, residential and commercial plumbing repair services; Modern Plumbing Supply Inc. is a retailer of plumbing supplies to the general public; and Modern Air Conditioning Inc. provides industrial, residential and commercial air conditioning repair services. The three companies have overlapping ownership interests and operate out of the same facility. The companies' employees are eligible to participate in the Modern Plumbing Co. Inc. 401(k) Plan.

The case was litigated by the department's Regional Solicitor's Office in Dallas, and the suit was filed in the U.S. District Court for the Southern District of Texas, Houston Division. Employers and employees can reach EBSA's Dallas office at 972-850-4500 or toll-free at 866-444-3272 for assistance relating to private sector retirement and health plans. Additional information can be found at http://www.dol.gov/ebsa.

Solis v. Modern Plumbing Co. Inc. et. al.
Civil Action Number 11-cv-02227

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U.S. Department of Labor news materials are accessible at www.dol.gov. The information above is available in large print, Braille, audio tape or disc from the COAST office upon request by calling 202-693-7828 or TTY 202-693-7755.