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 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
Two circuit courts ruled for the defendants in stock-drop lawsuits involving company stock in 401(k) plans.
Corey Rosen
A court denied Wilmington Trust’s request to move jurisdiction in an ESOP lawsuit concerning valuation at Graphite Sales to Delaware.
Corey Rosen
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 v. Commissioner, No. 18-1407 (3rd Cir. Nov. 2, 2018, unpublished), a circuit court ruled the IRS correctly disqualified an ESOP set up for a surgeon as the sole participant.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
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
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
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.
Corey Rosen
In Acosta v. Reliance Trust Co., Inc., No. 5:17-cv-00214-D (E.D.N.C., consent judgment Sept. 18, 2018), Reliance Trust agreed to settle a 2017 lawsuit over a $82.5 million ESOP transaction to buy the stock of Tobacco Rag Processors.
Corey Rosen
In Acosta v. Zander Group Holdings, Inc., No. 3:17-cv-01187 (M.D. Tenn., Sept. 10, 2018, order to dismiss defendants’ motion to dismiss), a court ruled that the company and its top executives had to defend their actions in a case alleging excessive valuation for an ESOP.
Corey Rosen
In Catalfamo v. Sears Holdings Corp. No. 1:17-cv-05230, (N.D. Ill., order granting defendants’ motion to dismiss 8/21/18) a district court ruled that Sears and its top executives did not violate ERISA by allowing company stock to remain in the 401(k) plan despite a 76.3% decline in stock value.
