Employee Ownership Legal Digest (6) Archive

Corey Rosen

January 30, 2025

Rep. Foxx: DOL Abused Authority on ESOP Info

In a strongly worded letter, Rep. Virginia Foxx, R-NC, chair of the House Committee on Education and the Workforce, says that the Department of Labor (DOL) abused its authority when it shared information from an ongoing investigation of Envision Radiology’s ESOP with the law firm Cohen Milstein, which is acting as the counsel for the plaintiffs in an ESOP valuation lawsuit against the trustee, selling share-holders, and individuals at the company.

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Corey Rosen

January 30, 2025

Lawsuit over ESOP Investment of Cash Assets Settled

In Tufano v. Pride Mobility, No. 3:24-cv-00765-KMA (M.D. Penn. Dec. 12, 2024) the parties have submitted a settlement agreement to the court. Plaintiffs sued over the company’s investing cash assets in the ESOP only in low-yield cash investments.

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Corey Rosen

December 10, 2024

IRS Private Letter Ruling on Uses of Match to 401(k) Plans May Allow Employees to Use Funds for Medical or Student Loan Costs

Most ESOP companies have 401(k) plans, so a recent IRS private letter ruling (PLR 202434006) may be of interest.

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Corey Rosen

December 10, 2024

DOL ESOP Valuation Claims Allowed to Proceed in Alerus Case

In Su v. Alerus Fin., N.A., No. 1:23-cv-00537-DCN (D. Idaho Nov. 4, 2024), the Department of Labor (DOL) plausibly alleged that Alerus, the trustee for the ESOP at Norco, improperly approved a valuation in a transaction in which Norco’s ESOP paid more than $140 million for a 35% stake in the company.

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Corey Rosen

December 10, 2024

Supreme Court Declines to Review Denial of Arbitration Claim in ESOP

On October 7, 2024, the Supreme Court denied an appeal of the denial of an arbitration clause in an ESOP.

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Corey Rosen

December 10, 2024

New Plan Limits for 2025

The IRS has released plan limits for 2025.

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Corey Rosen

December 10, 2024

Symbria ESOP Valuation Case Reaches Settlement Agreement

In Placht v. Argent et al., No. 1:21-cv5783 D (N.D. Ill. Oct. 24, 2024), the contesting parties reached a settlement agreement in an ESOP valuation case against the trustee for an ESOP at Symbria, Argent Trust.

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Corey Rosen

November 12, 2024

Western Global ESOP litigation settled

In David Burnett, et al., v. Prudent Fiduciary Services LLC, et al., No. 22-270-RGA (D. Del. Feb. 24, 2024), a district court gave preliminary approval for a settlement in a long-running lawsuit over a minority ESOP at cargo airliner Western Global.

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Corey Rosen

November 12, 2024

Supreme Court Denies DOL Appeal in ESOP Valuation Case

In Su v. Bowers, D.C. No. 1:18-cv-00155SOMWRP (Oct. 14, 2024), the Supreme Court declined to hear an appeal of a January 7, 2024, Ninth Circuit ruling that the Department of Labor did not have to pay attorneys’ fees to the defendant attorneys in a valuation case the DOL decisively lost.

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Corey Rosen

November 12, 2024

Court Dismisses ESOP Buyer Claim; Other Claims Continue

In Walther et al., v. Wood et al., No. 1:23-CV-294-GSL-SLC (N.D. Ind.), a district court dismissed a claim by employees that their ESOP should have been the rightful buyer of the 90% of the stock the plan did not own at the time of the former owner’s death, but allowed a claim that the company and the plan’s fiduciary breached their fiduciary duties to continue.

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