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News Release

Minnesota Company Assessed Civil Penalties For Failing To File 401(K) Plan Reports

Archived News Release — Caution: Information may be out of date.

Stillwater, Minn-based ProDisk, Inc. was ordered to pay $97,500 in civil penalties by an administrative law judge for failure to file annual reports for the 401(k) plan of the predecessor company Syncom Technologies.

The U. S. Department of Labor’s Pension and Welfare Benefits Administration (PWBA) contended that ProDisk was liable for the penalties because it was the successor administrator of the plan after the liquidation of Syncom Technologies. PWBA assessed the penalties against ProDisk for failure to file annual reports for 1994 through 1996.

The administrative law judge upheld the penalty by finding ProDisk was indeed the successor plan administrator of the pension plan. According to the judge’s ruling, there was sufficient evidence that ProDisk maintained “continuity of operations” of Syncom Technologies. ProDisk also was found to have known of the pension plan’s existence at the time ProDisk purchased all Syncom Technologies outstanding shares in January 1995.

Syncom Technologies filed for Chapter 11 bankruptcy and subsequently converted to Chapter 7 liquidation in December 1995.

“Our action in this case protects participants and beneficiaries by ensuring that they are able to receive pension distributions and make inquiries about their benefits," said Alan D. Lebowitz, Deputy Assistant Secretary for PWBA.

Department of Labor v. Syncom Technologies
Case No. 1998-RIS-28

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Archived News Release — Caution: Information may be out of date.

Employee Benefits Security Administration
July 24, 2000
Release Number