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 Moore v. Va. Cmty. Bankshares, No. 3:19-cv45 (W.D. Va. Mar. 30, 2023), a court ruled that a lawsuit alleging fiduciary improprieties in the sale of ESOP shares at Virginia Community Bank (VCB) prior to a merger could continue.
Corey Rosen
In Daly v. W. Monroe Partners, Inc., No. 21 C 6805 (N.D. Ill. Mar. 15, 2023), a district court allowed a former employee of West Monroe Partners to continue, although it ruled for the defendant on some issues.
Corey Rosen
In Rush v. GreatBanc, No. 19-cv-00738 (N.D. Ill., Dec. 16, 2022),a district court allowed a lawsuit to proceed claiming the sale of an ESOP company was for too little money. The company was 100% ESOP-owned until sold in 2016.
Corey Rosen
In Novosel v. Azcon Inc. Employee Benefits Plan Committee, No. 21 C 3080, (N.D. Il, E.D., Jan. 9, 2023), an employee was allowed to amend her complaint that she was underpaid for her ESOP shares because of an interim valuation that reduced the value of her stock by $53,000.
Corey Rosen
In Best et al v. James., No. 320-cv-299-JRW (W.D. Ky., Jan. 9, 2023) a court again ruled that plaintiffs must agree to arbitrate their claims against executives of ISCO Industries concerning the buyback of company shares from the ESOP.
Corey Rosen
Insurance for ESOP companies and fiduciaries has become more common in recent years, with courts limiting claims often because of contract exclusions, as in Martin Resource Management Corp. v. Federal Insurance Co., (5th Cir., Aug. 6, 2021); Gemini Insurance v. Potts, No. 2:16-cv-612 (S.D. Ohio Jul. 15, 2020); and Great American Fidelity Insurance Company v. Stout Risius Ross, Inc., No. 19-cv-11294 (E.D. Mich., Aug 23, 2021).
Corey Rosen
In Walsh v. Maine Oxy Acetylene Supply, No. 2:20- incv-00326NT (D. Me. Dec. 13, 2022), parties reached a $6.5 million settlement in a case in which plaintiffs contended that the ESOP trustee and the CEO of the company terminated an ESOP at an improperly low price to orchestrate a favorable deal for members of the board to buy back the 49% of the company the ESOP then owned.
Corey Rosen
In Lloyd v. Argent Trust, No. 1:22-cv-04129-DLC (S.D. NY, Dec. 6, 2022), a district court refused to send to arbitration a suit claiming Argent Trust allowed an ESOP to overpay for its purchase of stock in W BBQ at an inflated price.
Corey Rosen
In Stegemann v. Gannett, No. 1:18-cv-00325-AJT-JFA (E.D. Va., Nov. 17, 2022) a district court dismissed a motion for summary judgment from Gannett corporation arguing that plaintiffs could not be certified as a class in a long-running case involving employees at a Gannett spinoff, Tegna.
Corey Rosen
In Plutzer v. Bankers Trust Company of South Dakota et. al., No. 22-561-cv (2nd Cir., Nov. 21, 2022) a court dismissed a claim against Bankers Trust of South Dakota, the trustee for the ESOP at Tharanco Group.
