Stay informed on the latest legal developments impacting employee ownership with timely and concise summaries of key cases and rulings. Learn more about this digest »
Corey Rosen
In Johns v. Morris, No. 5:23-CV-324-D (E.D.N.C. Feb. 6, 2024), a district court ruled that Johns, the former COO and CEO of Morris & Associates, had standing to sue under ERISA over allegations that he was improperly dismissed from his job because as the ESOP fiduciary.
Corey Rosen
In Couturier v. Comm’r of Internal Revenue, No. 19714-16, (U.S.T.C. Jan. 22, 2024), a tax court ruled that a case must go to trial over a dispute over whether Claire Couturier made an excess contribution of $25,132,892 of the $26 million paid to an individual retirement account (IRA) during 2004–2005.
Corey Rosen
In Nguyen v. Westlake Services Holding Company, No. 8:23-cv-00854 (C.D. Cal., Feb. 5, 2024), a district court allowed a case to proceed in which the plaintiff alleges that Westlake Holding Company changed its ESOP rules in 2020 to allow the company to segregate accounts of former employees prior to their receiving a distribution as well as to allow a special interim valuation to reflect economic challenges arising from the pandemic.
Corey Rosen
In a report that received significant media attention, Oxfam, a nonprofit focusing on hunger and other poverty-related issues, found that “the combined fortunes of the world’s five richest men have more than doubled to $869 billion since 2020 while five billion people have been made poorer.”
Corey Rosen
NCEO member Vicki Graft at FORVIS wrote the following useful reminder of new rules that go into effect in 2024 for ESOPs and other defined contribution plans
Corey Rosen
In Su v. Bowers, D.C. No. 1:18-cv-00155SOMWRP (9th Cir. Jan. 7, 2024), the Ninth Circuit again said that the Department of Labor did not have to pay attorneys’ fees to the defendant attorneys in a valuation case the DOL decisively lost.
Corey Rosen
In Bolton v. Inland Fresh Seafood Employee Stock Ownership Plan, No. 1:22-cv-04602-AT (N.D. Ga. Dec. 5, 2023) a district court dismissed a lawsuit at Inland Fresh Seafood over the valuation of the company when it was sold to the ESOP in 2016 for $92 million.
Corey Rosen
In Kloss v. Argent Trust Co., No. 23-cv-0301 (D. Minn. Dec. 12, 2023), a federal court allowed a case over the purchase of shares in TPI by an ESOP to continue.
Corey Rosen
In Moore v. Va. Cmty. Bankshares, No. 3:19-cv00045 (W.D. Va. Nov. 28, 2023), a settlement has been reached in a lawsuit alleging fiduciary improprieties in the sale of ESOP shares at Virginia Community Bank (VCB) prior to a merger.
Corey Rosen
In Rev. Rul. 2003-27; 2003-1 C.B. 597, EB. 20, 2003, the IRS ruled that the basis of shares on an S corporation ESOP trust must be adjusted in the same way as any other S corporation shares are adjusted for the purpose of calculating net unrealized appreciation.
