Corey Rosen
IRS Issues New Guidance to Voluntary Correction Program
Revenue Procedure 2021-30 lays out a number of changes to the Voluntary Correction Procedure process for the correction of plan qualification errors.
Employee Ownership Legal Digest (18) Archive
Stay informed on the latest legal developments impacting employee ownership. This page provides timely and concise summaries of key cases and rulings, contributed by experienced attorneys, to help the entire employee ownership community understand their implications, and also offers access to NCEO's archive of prior content.
Corey Rosen
Seventh Circuit Says ERISA Does Not Preempt Certain Bankruptcy Law Claims
In Halperin v. Richards, No. 20-2793, WL 3184305 (7th Cir. July 28, 2021), the Seventh Circuit considered whether ERISA “preempts certain state-law claims brought by bankruptcy creditors on behalf of a company against its directors and officers and others alleged to have inflated the company’s stock value to conceal the company’s decline and to benefit corporate insiders.”
Corey Rosen
Plaintiffs Lose Another Stock-Drop Case
In Osborne et al. v. Employee Benefits Administration Board of Kraft Heinz et al., No. 1:20-cv-02256 (N.D. Ill., Aug. 23, 2021), plaintiffs in Kraft Heinz’s retirement plan failed to convince a court that a drop in the price of their company’s stock was a fiduciary violation.
Corey Rosen
Arbitration Clause Upheld in GM Stock Drop Case
In Webb v. Fid. Brokerage Servs., No. 354691 (Mich. Ct. App., 354691, July 29, 2021), a retired employee lost claim for a breach of fiduciary duty after his GM stock dropped within a rollover IRA managed by Fidelity.
Corey Rosen
Class Certified in Segerdahl ESOP Sale
In Rush v. GreatBanc, No. 19-cv-00738 (N.D. Ill., June 16, 2021), a district court granted class status to the plaintiff, saying that he could represent the class of participants in an ESOP at Segerdahl Corporation.
Corey Rosen
Ninth Circuit Allows Current ESOP Trustee to Continue Claim Against former ESOP Trustee
In Wong v. Flynn-Kerper, No. 19-56289 (9th Cir., June 7, 2021), the Ninth Circuit overrode a lower court dismissal of a case in which plaintiffs sought to recover an alleged overpayment to the late Bernard Kerper from his widow. Kerper was the former trustee of an ESOP at Anaplex.
Corey Rosen
Wilmington Trust Settlement Approval in Nation Safe Drivers Suit Approved
In Fink v. Wilmington Trust, NA, No. 1:19-cv-01193 (D-Del., motion for settlement approval June 8, 2021), Wilmington Trust NA agreed to pay $5.5 million to settle a proposed class action challenging Wilmington’s right in approving a 2014 $342 million transaction for an ESOP to purchase Nation Safe Drivers Corporation.
Corey Rosen
DOL Cybersecurity Guidance Issued
On April 14, 2021, the U.S. Department of Labor (“DOL”) issued a cybersecurity guidance package for ERISA plan sponsors. This is DOL’s first guidance directly addressing cybersecurity. The guidance includes three separate documents:
Corey Rosen
Wilmington Trust Can Proceed on One Claim Against Valuation Firm
Wilmington Tr., N.A. v. Stout Risius Ross, Inc., No. 20 Civ. 2505 (S.D. NY, March 23, 2021). The lawsuit revolves around Stout’s role as the appraiser in Brundle v. Wilmington Trust, No. 17-1873 (4th Cir., March 21, 2019), which ended up in a $29.8 million judgment against Wilmington Trust over its role in the ESOP at Constellis.
Corey Rosen
Edison wins stock drop case
In Wilson v. Craver, No. 18-56139 (9th Cir, April 19, 2021), the 9th Circuit Court upheld a lower court ruling that the plaintiff did not state a plausible course of alternative action Edison Electric executives could have taken that would have done more good than harm in a case involving a drop in Edison’s stock value in the company’s ESOP.