|
Portland, Oregon - The U.S. Department of Labor
has obtained a consent judgment in which funds will be restored to the
Litho Development and Research Inc.’s employee stock ownership plan to
cover losses resulting from fiduciary breaches by Ralph Johnson, the
company's president, chief executive officer and the plan's trustee.
The agreement will settle all claims asserted in the
department’s lawsuit which sought to remedy alleged violations of the
Employee Retirement Income Security Act (ERISA). The Labor Department
suit, which asserted that Johnson authorized an improper cash distribution
to himself, sought restitution of all losses, plus interest, attributable
to the alleged fiduciary breaches.
The consent judgment, entered in federal district court
December 22, 2005, removes Johnson as plan trustee and appoints an independent
fiduciary with full authority to liquidate the plan assets; identify
legitimate claimants and pay the amount of their claims; distribute plan
assets to eligible participants, and pay service providers. Johnson agrees
to restore $100,000 to the plan within 60 days, none of which is to be
allocated to his own plan account. In addition, Johnson is permanently
enjoined from any future violations of ERISA.
“This case sends a strong message to those
responsible for employee benefit plans that they cannot use their
employees’ funds for their own personal benefit,” said Francis Clisham,
regional director of the Labor Department’s Employee Benefits Security
Administration (EBSA) in San Francisco, which investigated the case
through its Seattle District Office.
Employers and workers can reach EBSA’s Seattle
district office at 206.553.4244 or through its toll free number,
1.866.444.EBSA (3272), for help with problems relating to private sector
retirement and health plans.
(Chao v. Johnson)
Adversary No. 3:05-cv-453-BR
United States District Court For The District of Oregon |
