August 11, 2026
A plumbing subcontracting company will pay $13.75 million to settle workers’ class action alleging its co-founders sold company shares to an employee stock ownership plan at an inflated price and later repurchased them for far less, according to a filing in California federal court.
Alfredo Ramirez and Ramón Santos Castro asked the court Monday for preliminary approval of the settlement agreement, which would end their Employee Retirement Income Security Act suit against Ampam Parks Mechanical Inc., two co-founders, ESOP trustee Neil Brozen, Ventura Trust Co. and other company defendants. According to the motion, the agreement was reached during mediation in June, after which the court paused the case while the parties finalized the deal.
“The settlement eliminates all litigation risks” and “provides the class with prompt and certain relief,” Ramirez and Castro told the court.
Ramirez, a current Ampam employee, and Castro, a former employee, claimed in their suit in May 2024 that the ESOP paid $247 million for the plumbing company’s stock in 2019 and sold it back to its founders in 2023 at a steep discount. The court greenlit a class in March 2025 comprising all participants in and beneficiaries of the Ampam plan on Aug. 6, 2023, when the ESOP sold the company’s shares, which is approximately 1,100 people, according to Monday’s motion.
Ramirez and Castro said the $13.75 million settlement fund represents approximately 56% of the estimated damages to the ESOP and an average gross recovery of $12,000 per class member. According to the motion, the class’ valuation expert concluded that without the 2019 overpayment, the 2023 sale could’ve netted $47.5 million, but the ESOP actually received $23 million.
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Michelle Yau of Cohen Milstein Sellers & Toll LLP, who is representing the class, told Law360 in a statement that they “are pleased with the significant value this settlement provides for the ESOP participants and proud of the class representatives for their dedication and tenacious representation of the class.”
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Ramirez, Castro and the class are represented by Michelle C. Yau, Daniel R. Sutter, Allison C. Pienta and Ryan A. Wheeler of Cohen Milstein Sellers & Toll LLP.