Corey Rosen
Selway Agrees to Settlement
In Barker v. Selway Corp., No. 9:18-cv- 00179 (D. Mont., petitioners’ motion for preliminary approval of settlement, Nov. 16, 2018) the parties agreed to an arbitrated $5.5 million settlement.
Employee Ownership Legal Digest (26) 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
WaWa Agrees to Settlement in Account Segregation Case
In Pfeifer v. Wawa, Inc., No. 2:16-cv-00497-PD (E.D. Pa., motion for settlement approval filed 12/29/17), the trustees of WaWa’s ESOP agreed to pay about 2,300 current and former employees $25 million ($5 million of which will go to attorney’s fees).
Corey Rosen
Marathon Petroleum Executives Did Not Violate ERISA in Allowing Investment in Company Stock in 401(k) Plan
In Yates v. Nichols, No. 3:17-cv-01389-JGC 2017 (N.D. Ohio, order granting defendant’s motion to dismiss December 18, 2017), a court ruled that fiduciaries of Marathon’s 401(k) plan did not breach their fiduciary duties by allowing employees to invest in company stock in the company’s 401(k) plan.
Corey Rosen
Ambiguous Stock Option Offer Letter Superseded by Subsequent Correspondence
In Vespremi v. Tesla Motors, a state court ruled that a plaintiff who had received an offer for stock options in Tesla could not receive any of the stock options he claimed he deserved.
Corey Rosen
Hewlett-Packard, Eaton Defeat Challenges to Stock in 401(k) Plans
Two circuit courts ruled for the defendants in stock-drop lawsuits involving company stock in 401(k) plans.
Corey Rosen
Wilmington Trust Cannot Transfer Lawsuit to Delaware
A court denied Wilmington Trust’s request to move jurisdiction in an ESOP lawsuit concerning valuation at Graphite Sales to Delaware.
Corey Rosen
One-Person ESOP Not Qualified
In Paza Staffing Servs. v. Commissioner, No. 18-1407 (3rd Cir. Nov. 2, 2018, unpublished), a circuit court ruled the IRS correctly disqualified an ESOP set up for a surgeon as the sole participant. The surgeon had five other employees.
Corey Rosen
Settlement in Triple-T Transport Case
In Acosta v. Potts, No. 2:16-cv-00612-JLG-CMV (S.D. Ohio, Oct. 17, 2018), the DOL and Thomas Potts agreed to a settlement of $465,000, pending additional amounts that may be recovered pending litigation with the fiduciary insurer.
Corey Rosen
Stock-drop Case Fails
In Quatrone v. Gannett Co., Inc., No. 1:18-cv-00325 (E.D. Va., Sept. 26, 2018), a district court ruled that plaintiffs could not plead a plausible alternative course of action for plan trustees to take regarding the holding of company stock in Tegna’s 401(k) plan. In 2015, Gannett Corporation changed its name to Tegna and spun off its publishing business (USA Today and others) to the new Gannett Corporation. Tegna retained mostly broadcast holdings.
Corey Rosen
Plaintiffs lose in SunEdison stock-drop case
In In re SunEdison, Inc. ERISA Litig, No. 16-mc-2744 (S.D.N.Y., Aug. 6. 2018), the Second District Court for Southern New York continued its string of defeats for plaintiffs when it ruled that offering employer stock within an ESOP in the company’s 401(k) plan was not an ERISA violation.