EBSA News Release: [03/16/2011]
Contact Name: Rhonda Burke or Scott Allen
Phone Number: (312) 353-6976 or x6976
Release Number: 11-0361-CHI
US Department of Labor sues to distribute 401(k) account assets of Minneapolis-based Northland Inn
MINNEAPOLIS The U.S. Department of Labor has sued Parkland Hotel Investors LP, the fiduciary of the Northland Inn 401(k) plan, for violations of the Employee Retirement Income Security Act. The suit alleges that the plan was abandoned after Parkland ceased business operations in July 2009 and failed to distribute approximately $1,350,000 in assets to 96 plan participants.
"Workers deserve to keep the benefits they have earned regardless of a fiduciary's business status," said Phyllis C. Borzi, assistant secretary for the Labor Department's Employee Benefits Security Administration. "The department is taking action to ensure that these plan participants have access to the benefits owed to them."
An investigation by EBSA's Kansas City, Mo., regional office found that participants and beneficiaries of the plan have not been able to obtain distributions from their individual account balances since December 2009. The suit seeks to appoint an independent fiduciary to distribute the plan's assets.
Plans become "orphan plans" when they are abandoned by all of the fiduciaries designated to manage and operate them and their assets, as in this case. As a result of the abandonment, participants and beneficiaries are unable to communicate with the plan fiduciary or obtain distributions from their accounts.
EBSA protects the retirement, health and other workplace-related benefits of America's workers, retirees and their families. The agency oversees approximately 708,000 private sector retirement plans, 2.8 million health plans and a similar number of other workplace-related benefit plans that cover more than 150 million Americans. Collectively, these plans hold more than $6 trillion in assets.
The suit was filed in federal district court in Minneapolis and was litigated by the department's regional solicitor in Chicago. Employers and workers can reach EBSA's Kansas City office at 816-285-1800 or toll-free at 866-444-3272 for help with problems related to private sector retirement and health plans. Additional information can be found at http://www.dol.gov/ebsa.
Solis v. Parkland Hotel Investors LP and the Northland Inn 401(k) Plan.
Civil Action Number: 11-cv-00654-PAM