Corey Rosen
Guidance Issued on Expansion of Employee Plans Compliance Resolution System
SECURE 2.0 expanded the application of the Employee Plans Compliance Resolution System (EPCRS), which allows companies to voluntarily correct certain errors.
Employee Ownership Legal Digest (13) Archive
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
ESOP Participants Denied Claims in Bankruptcy Case
In CPESAZ v. Oxford Restructuring Advisers, Bk. No. 9:20-bk-10554-DS (9th Cir. Bankruptcy Appellate Panel, June 2, 2023), the 9th Circuit ruled that ESOP participants in an ESOP at Community Provider of Enrichment Services Arizona do not have grounds for filing claims against the company in a bankruptcy liquidation case.
Corey Rosen
Triad Manufacturing ESOP Case Settled
In Smith v. Greatbanc Trust, No. 20 C 2350 (D. Ill. June 7, 2023), a district court approved a $14.8 million settlement involving an ESOP at Triad Manufacturing. The ESOP had purchased the company for $106 million in 2015.
Corey Rosen
KPC Healthcare Case Comes to an End
In Gamino v. KPC Healthcare Holdings, Inc. et al., No. 5:20-V-01126-SB-SHK (C.D. Cal. June 5, 2023), Silver Point Capital agreed to a $100,000 settlement over its role in the ESOP at KPC Healthcare. Silver Point had previously won a dismissal from the case.
Corey Rosen
DOL ESOP Valuation Regulation Process Outlined
The US Department of Labor (DOL) has stated that it will undertake a formal notice and comment rulemaking “relatively soon” on the adequate consideration requirement governing the valuation of ESOP-held shares.
Corey Rosen
Triad ESOP Settlement Terms Announced
In Smith v. GreatBanc Trust Company, No. 20 C 2350 (N.D. Ill. Feb. 9, 2023), plaintiffs and defendants agreed to settle a case in which the plaintiffs argued that their ESOP paid $104 million for stock they contend was worth only $4 million.
Corey Rosen
SVB Employees Recover $25M in Stock Plan Funds
About 4,000 employees of failed Silicon Valley Bank will get back $25 million that they had set aside to buy stock at a discount under the bank’s employee stock purchase plan.
Corey Rosen
SBA Adopts New Guidance Making Loans to ESOPs Much Easier
The Small Business Administration (SBA) has taken steps to make loans to ESOPs much easier than under prior rules. The agency had received considerable criticism for issuing requirements for ESOP loans that are inconsistent with the language and intention of the Main Street Employee Ownership Act (MSEOA).
Corey Rosen
Envision Arbitration Denied in 10th Circuit ESOP Case
The 10th Circuit declined to revisit its ruling that Envision Management cannot compel arbitration in an ERISA ESOP overpayment lawsuit.
Corey Rosen
ESOP Trustee Must Face Class Action Lawsuit in Symbria Transaction
In Placht v. Argent et. al., No. 1:21-cv5783 D (N.D. Ill. Apr. 11, 2023), a district court allowed plaintiffs to proceed as a class in an ESOP valuation case against the trustee, Argent Trust.