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Case ID: 2579 | Employment | 08/30/2004
A class action has been filed against energy provider Mirant Corporation and certain company officials on behalf of current and former employees whose retirement plans were invested in the company's stock. The action alleges that the executives breached their fiduciary responsibilities in violation of federal labor law when they knew of the company's financial problems but continued to encourage employees to purchase stock for their plans, sometimes while selling their own shares. The action seeks compensatory and punitive damages.
A separate lawsuit alleging securities fraud, also seeking class-action status, has been filed against the company. What makes this case different is that it is based on federal laws governing management of retirement funds instead of relying on securities law. This action is filed under the Employee Retirement Income Security Act (ERISA). ERISA governs the conduct of employers who sponsor 401(k) plans and other retirement plan accounts. There is a much lower burden of proof in determining whether the responsibilities of a fiduciary were met under ERISA, making the likelihood of success for the employees relatively greater. The action alleges that there was a basic conflict of interest for the company's executives to oversee the retirement plans of the company's employees, because the employees' best interest was to know that the company was in trouble financially so they could get rid of the company stock, but it was in the company's best interest for no one to find out that information so investors wouldn't sell the company's stock. At Lawcash.com, it is our goal to keep you informed about important legal cases, class actions and settlements. Our lawyers offer free legal evaluations in tort cases, class actions, personal injury, and other lawsuits because we are dedicated to helping you resolve your legal complaints. Other Employment Cases of Interest If money in a trust is not being used, it often reverts to the person who placed it in the trust. The parties have reached a final settlement apparently valued at $39 million in an action filed against The Boeing Company, McDonnell Douglas Corporation, and Chase Manhattan Bank, N.A. on behalf of retired McDonnell Douglas Corporation employees, their surviving spouses, and widows and widowers of deceased McDonnell Douglas Corporation employees, who made or on whose behalf was made one or more contributions to the MDC Health Care Trust (also referred to as the VEBA Trust) from its inception through December 31, 1996. The action alleged that those contributions made through December 1996 were being held and not properly used, and sought a return of those funds to the contributors. Persons eligible to participate in this settlement should contact class counsel for more information. A class action lawsuit has been filed in the Middle District Court of Florida against SCI Funeral Services of Florida, Inc., a Texas based funeral services company, for violations of the Fair Labor Standards Act (FLSA). Class members seek damages in the amount of unpaid overtime compensation owed, liquidated damages or pre-judgment interest, reasonable attorney’s fees and costs of the litigation. A class action lawsuit has been filed in federal court against Florida based health care provider life care centers. The case involves violations of federal labor law. No additional information about the substance of the allegations is available at this time. Classactionamerica.com will monitor this case and provide additional details as soon as they become available. A 2004 lawsuit that claimed three south Louisiana school systems failed to pay overtime to hundreds of employees may get a second chance at being granted class action status. Attorneys that filed the case originally missed the deadline for certifying the case as a class action and ignored demands to explain why. A class action lawsuit has been filed in the Northern District Court of Ohio against RR Donnelly (formerly Moore-Wallace North America, Inc.) for violations of the Employment Retirement Income Security Act (ERISA). ERISA is a federal law that sets minimum standards for most voluntarily established pension and health plans in private industry to provide protection for individuals in these plans.
Class members seek a determination that the Pension Plan was discontinued on or about December 31st, 2000 and terminated on June 4th, 2001 and that the members of the class are entitled to the surplus assets remaining in the pension fund after the satisfaction of all defined benefit Plan liabilities.
Mel McLean, owner of the Eel River Sawmills, and his wife Grace, had no children around 1988 when they created an Employee Stock Ownership Plan, according to background information in the lawsuit’s fourth amended complaint. The McLeans intended and promised to pass the majority ownership of Eel River Sawmills to its employees through the plan, the lawsuit stated.
“If the promise had been kept, the employees would have had a majority ownership of the company and the dollar value of the company at the time of (owner Mel McLean’s) death appears to have been well in excess of $25 million,” the attorney for the plaintiffs said. |
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