Date of Action: March 31, 2016
Type of Actions: Employee Retirement Income Security Act Lawsuit
Adversary Complaint in Bankruptcy Petition No. 15-23963.
Defendants: Michael A. Lewis
Acme Orthotics and Prosthetics Laboratories Inc. Profit Sharing 401(k) Plan and Trust.
The president and owner of Acme, Michael A. Lewis is the sole named defendant in the adversary complaint filed in bankruptcy court.
Allegations: An investigation by the U.S. Department of Labor’s Employee Benefits Security Administration found Northfield, Illinois, based Acme Orthotics and Prosthetics Laboratories Inc., Lewis, and the company’s executive director, Monica Fox, violated the Employee Retirement Income Security Act while serving as fiduciaries to the Acme Orthotics and Prosthetics Laboratories Inc. Profit Sharing 401(k) Plan and Trust.
The investigation found that from at least July 9, 2010, through April 27, 2012, Lewis and Fox caused Acme Orthotics and Prosthetics Laboratories to withhold and fail to remit $24,000 in employee contributions and $15,391.17 in participant loan repayments from participating employees’ paychecks intended for the plan. Additionally, from April 16, 2012, to March 5, 2015, Lewis allegedly misappropriated $66,431.99 of plan participants’ money for non-plan purposes. As of Jan. 21, 2016, $105,823.16, plus lost opportunity costs, is owed to the plan.
The lawsuit seeks a judgment requiring:
- Lewis and Fox to make good to the plan any losses, including lost opportunity costs.
- A return of all profits received by defendants as a result of fiduciary breaches.
- Appointment of an independent fiduciary to terminate the plan and distribute assets to eligible participants.
- Removal of Lewis and Fox as fiduciaries, and to bar each from serving or acting as a fiduciary to any ERISA-covered employee benefit plan in the future.
The bankruptcy court adversary complaint seeks a determination from the court that the debts resulting from Lewis’ fiduciary breaches involving plan assets are non-dischargeable.
As of July 31, 2015, the plan had six participants and $163,122.08 in assets.
Court: U.S. District Court for the Northern District of Illinois
U.S. Bankruptcy Court for the Northern District of Illinois
Employers and workers can reach EBSA 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/.