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The U.S. Department of Labor today settled its
lawsuit with executives of Brewster Dairy, Inc., in Brewster, Ohio, who agreed
to pay $333,333 to the company’s profit sharing plan. These recovered
funds and any additional distributions from the limited partnership are to be
prorated and allocated to individual accounts of the plan’s eligible
participants except for the defendants in the case.
The department’s lawsuit charged the dairy,
co-owners Fritz Leeman and Walter Leeman and vice president of finance Thomas
Riegler, who acted as plan fiduciaries, with imprudently investing more than $1
million of the company’s plan assets in a real estate limited partnership.
According to the lawsuit, the defendants committed
the plan to pay $1,013,115 to purchase units in the Heartland California
Clayton Limited Partnership. The plan ultimately invested $749,462.50 in the
partnership over the period December 1990 to February 1996. The limited
partnership was invested in a parcel of property located in the San Francisco
Bay Area. Brewster Dairy was charged with failing to take steps to remedy the
improper actions of the individuals who acted as plan fiduciaries.
The settlement and consent judgment resulted from
an investigation conducted by the Cincinnati Regional Office of the
department’s Pension and Welfare Benefits Administration into alleged
violations of the Employee Retirement Income Security Act. The settlement was
entered in federal district court on July 1 in Cleveland.
(Herman v. Brewster Dairy, Inc. et al)
Civil
Action No. 5:98 CV 744 |
