Corey Rosen
Starkey ESOP Case Settled
In Beck v. Austin, No. 19-CV-1453 (D.C., Minn., March 12, 2021), a court approved a $173,000 settlement against various defendants, including the CEO, of Starkey Laboratories, a hearing aid manufacturer.
Employee Ownership Legal Digest (22) 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
Mixed Decision in ESOP Valuation Case
In Stewart v. Saakvitne, No. 18-00155 SOM-WRP, (D. Haw., March 12, 2021), a district court denied summary judgment to former members of the board of directors of an ESOP firm, Bowers + Kubota, over an ESOP valuation case.
Corey Rosen
Class Status Approved in ESOP Refinancing Case
In Gamache v. Hogue, No. 1:19-CV-21, (M.D. Ga. March 3, 2021), a court certified class to allowed plaintiffs to proceed with a lawsuit alleging that a refinancing of a 97% ESOP that resulted in the two principals of the firm ending up with 40% of the shares was a violation.
Corey Rosen
Former ESOP Company Executive Sentenced to Prison for Financial Fraud
In United States v. Lindsey 3:20-cr-00022 (E.D. Va. Feb 18, 2020), a district court convicted Patrick Lindsey, a former vice president of MGT Construction, of financial fraud involving over $20 million and sentenced him to 27 months in prison.
Corey Rosen
ESOP Valuation Case Can Proceed
In Scalia v. Reliance Trust et.al., No. 17-cv-4540 SRN-ECW (D.C., Minn., March 2, 2021), a district court rejected motions to provide a partial summary judgment for the plaintiffs or to dismiss the case for defendants.
Corey Rosen
Plaintiffs Lose Again in Johnson & Johnson Case
In Perrone v. Johnson & Johnson, No. 3:19-cv-00923, (D. N.J., Feb. 26, 2021), a district court rejected a lawsuit alleging that Johnson & Johnson executives breached their fiduciary duties when they did not reveal problems with its talcum powder that were linked to cancer cases.
Corey Rosen
IRS Seeks Comments on Form 5309 ESOP Determination Letter Request
As part of a program to reduce federal paperwork requirements, the IRS is asking for comments on Form 5309, Application for Determination of Employee Stock Ownership Plan. Comments are dues by April 21. Direct all written comments to Kinna Brewington, Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW, Washington, DC 20224.
Corey Rosen
GreatBanc Case Can Proceed
In Godfrey v. GreatBanc et. al., No. 18 C 7918 (N.D. Ill., Feb. 21, 2021), a district court certified a class action lawsuit in an ESOP case at McBride and Sons involving a 2013 reorganization that reduced the ESOP’s ownership from 100% to 60%, with officers of the company owning 40%.
Corey Rosen
Request for Arbitration of ESOP Lawsuit Denied
In Hensiek et.al, vs Board of Directors of Casino Queen Holding Company, Inc., et.al, No. 3:20-CV-377-DWD (7th Cir. January 25, 2021), the Seventh Circuit denied a request by the defendants in an ESOP case to compel arbitration over claims of a fiduciary breach related to the valuation of Casino Queen stock.
Corey Rosen
Raydon Settlement Denied:
In Woznicki v. Raydon, No: 6:18-cv-2090-Orl-78GJK (M.D. Fl., Feb. 17, 2021), a district court denied approval of a $2.4 million settlement with Lubbock National Bank in a $60.5 million lawsuit over an ESOP at Raydon Corporation.