Summary of the Lawsuit
This lawsuit, entitled Burwitz v. Ulteig Engineers, Inc. Employee Stock Ownership Plan, No. 4:11-cv-04175-LLP (D.S.D.), alleged that certain participants in the Ulteig ESOP were wrongfully denied benefits in violation of the Employee Retirement Income Security Act of 1974 (“ERISA”).
Summary of the Claims
Plaintiffs were eligible for and elected to receive a single lump sum distribution of the Ulteig stock in their vested ESOP account based on the value of the stock (as determined by annual valuation) at the time they requested the distribution. The Plan was subsequently amended to eliminate the lump sum distribution option for participants with accounts valued over $1,000 (and under $100,000). The Complaint alleged that the Plan unlawfully applied this amendment retroactively to deny Plaintiffs and the Class with the right to receive their benefits as a single lump sum distribution, in violation of ERISA §§ 502(a)(1)(B) and 204(g). Instead, the Plan was paying the Class their benefits in a series of annual installments based on a “floating” valuation of the Ulteig stock, where the amount of each installment was determined by dividing the value of the Ulteig stock in the participant’s account as of the current annual valuation by the number of remaining installment payments. Plaintiffs sought a declaration that they and the Class were entitled to receive benefits in an amount that was at least equal to the amount due under the terms of the Plan as it existed at the time of their termination, plus interest.
This lawsuit was brought on behalf of the following persons:
Participants in the Ulteig Engineers, Inc. Employee Stock Ownership Plan, who were eligible for a single lump sum distribution of the Ulteig stock in their vested ESOP account under the terms of the Plan in effect at the time of their termination, who requested a distribution of the Ulteig stock in their vested ESOP account prior to October 15, 2009, and who have not received a distribution of all of the Ulteig stock in their vested ESOP account that is equal to or more than the value of the Ulteig stock as determined by the most recent annual valuation prior to the time of their distribution request, plus interest.
This Class also includes the beneficiaries of any of the Participants described above.
History of the Litigation
Plaintiffs filed their complaint on December 5, 2011. After Plaintiffs filed their Complaint, the Plan made payments to all participants in the Plan whose employment was terminated prior to November 12, 2009, who requested a distribution prior to November 12, 2009 and who had account balances as of December 31, 2008 of between $1,000 and $100,000, in an amount that equals the value of those participants’ accounts pursuant to the December 31, 2008 valuation, plus interest. Based on an affidavit of Steven P. Maag, Ulteig’s then CFO and a member of the Administrative Committee, who confirmed such payments were made, Plaintiffs agreed that all amounts, other than fees and expenses, sought in their complaint on behalf of themselves and the class had been distributed by Defendant to the Plaintiffs and the putative class. As a result, Plaintiffs agreed to dismiss with prejudice their claims other than any requests for attorneys’ fees, expenses and costs. On January 14, 2014, the Court granted Plaintiffs’ motion for attorney fees and costs, and entered a Judgment of Dismissal on January 15, 2014.
Whom to Contact for More Information
If you have questions about this case or have a circumstance similar to this case, please contact one of the following persons:
R. Joseph Barton, Esq., firstname.lastname@example.org
Cohen Milstein Sellers & Toll PLLC
1100 New York Avenue, N.W., Suite 500
Washington, D.C. 20005