UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA
June 27, 2012
HILDA L. SOLIS, SECRETARY OF LABOR, UNITED STATES DEPARTMENT OF LABOR, PLAINTIFF,
HI-COUNTRY ELECTRIC, INC. A CALI- FORNIA CORPORATION; ROB L, FRITZEMEIER, AN INDIVIDUAL; AND HI- COUNTRY ELECTRIC 401(K) PLAN,
The opinion of the court was delivered by: Lawrence J. O'Neill United States District Judge
CONSENT JUDGMENT AND ORDER
Plaintiff HILDA L. SOLIS, Secretary of Labor, United States Department of Labor ("Secretary") pursuant to her authority under Sections 502(a)(2) and (5) of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1132(a)(2) and (5), has filed a Complaint against Defendant HI-COUNTRY ELECTRIC, INC. ("Hi-Country" or "Company"), a California corporation, Defendant ROB L. FRITZEMEIER ("Fritzemeier" or "Trustee"), an individual, and Defendant HI- COUNTRY ELECTRIC 401(k) PLAN ("401(k) Plan" or the "Plan"), an employee benefit plan within the meaning of Section 3(3) of ERISA, 29 U.S.C. § 1002(3).*fn1
A. The Secretary, Hi-Country, Fritzemeier, and the Plan (collectively, the "Parties") admit that the Court has jurisdiction over this action pursuant to ERISA Section 502(e)(1), 29 U.S.C. § 1132(e)(1), and that venue lies in the Eastern District of California pursuant to ERISA Section 502(e)(2), 29 U.S.C. § 1132(e)(2).
B. Defendants Hi-Country, Fritzemeier, and the Plan (collectively the "Defendants") waive filing of an Answer and entering any affirmative defense, counterclaim, or third-party complaint, or any other defenses that they may have in this case.
C. The Parties agree to the entry of this Consent Judgment and Order. The parties further agree that this Consent Judgment and Order shall fully settle all claims of the Secretary asserted in the Complaint filed in this matter.
D. All parties expressly waive Findings of Fact and Conclusions of Law. IT IS HEREBY ORDERED, ADJUDGED, and DECREED that:
1. Defendant Fritzemeier is permanently enjoined and restrained from violating the provisions of Title 1 of ERISA, 29 U.S.C. §§1001-1191(c).
2. Defendant Hi-Country is hereby removed as Plan Administrator and fiduciary of the Plan.
3. Defendant Fritzemeier is hereby removed as a fiduciary of the Plan, subject to the exceptions set forth in Paragraphs 4, 7 and 8 below.
4. Defendant Fritzemeier shall succeed as Plan Administrator and shall remain a fiduciary of the Plan solely for the purpose of making distributions of the assets of the Plan and implementing the termination of the Plan, in accordance with the instructions set forth below in Paragraphs 7 and 8. After Defendant Fritzemeier fulfills the duties set forth in Paragraphs 7 and 8, he shall immediately be removed from his positions as Plan Administrator and fiduciary of the Plan.
5. Defendant Fritzemeier is permanently enjoined and restrained from future service as a fiduciary of, or service provider to, any ERISA-covered employee benefit plan subject to the exceptions set forth in Paragraphs 4, 7 and 8 herein.
6. Within fifteen (15) calendar days following the Court's entry of this Con-sent Judgment and Order, Defendant Fritzemeier shall provide a copy of this Consent Judgment and Order to the Plan's custodial trustee, ING, North America Insurance Corporation ("ING").
7. Within thirty (30) calendar days following the Court's entry of this Consent Judgment and Order, Defendant Fritzemeier shall take the following action:
(a) Defendant Fritzemeier shall notify ING of the Plan's terminated status in writing, and shall authorize and direct ING, in writing, to make distributions to all eligible participants and/or beneficiaries in accordance with the Plan terms and the partici-pant's and/or beneficiary's elected method of receipt of the funds (e.g., via lump-sum distribution to the participants or a direct rollover into another qualified retirement ac-count belonging to the participant and/or beneficiary). Defendant Fritzemeier shall monitor and ensure ING carries out his directions consistent with the Plan terms and ERISA.
(b) Defendant Fritzemeier shall provide, within 10 business days, documentation to the Secretary of his written notification to ING of the Plan's terminated status as set forth in Paragraph 7(a).
(c) Defendant Fritzemeier shall, pursuant to the procedures outlined in the Employee Benefit Security Administration Field Bulletin 2004-02, exercise reasonable care and diligence to identify and locate each participant and beneficiary of the Plan who is eligible to receive a distribution under the terms of the Plan.
(d) Defendant Fritzemeier shall timely file a Final Form 5500 for the Plan.
8. Within fifteen (15) calendar days of the completion of all actions set forth above in both Paragraphs 7(a) and 7(c):
(a) Defendant Fritzemeier shall provide documentation verifying the final liquidation and disposition of the Plan's assets to the Secretary, and thereafter, he shall immediately be removed from his positions as Plan Administrator and fiduciary of the Plan.
(b) Defendant Fritzemeier shall also provide to the Secretary upon request any other documentation related to its investigation.
9. The final liquidation and disposition of the Plan's assets shall occur no later than February 28, 2013.
10. Each time a submission to the Secretary is required under this Consent Judgment and Order, such submission shall be made by reliable overnight delivery and facsimile to:
Jean Ackerman, Regional Director
United States Department of Labor Employee Benefits Security Administration 90 7th Street, Suite 11300 San Francisco, California 94103 Fax: 415-625-2450
11. Defendants expressly waive any and all claims of any nature which they have or may have against the Secretary, the Department of Labor, or any of its officers, agents, attorneys, employees or representatives, arising out of or in connection with the allegations contained in the Complaint on file in this action, any other proceedings or investigation incident thereto or based on the Equal Access to Justice Act, as amended.
12. The parties shall each bear their own costs, expenses, and attorneys' fees incurred to date in connection with any stage of this proceeding, including but not li- mited to attorneys' fees which may be available under the Equal Access to Justice Act, as amended.
13. Nothing in this Consent Judgment and Order is binding on any governmental agency other than the United States Department of Labor, Employee Benefits Security Administration.
14. This Court retains jurisdiction of this action for purposes of enforcing compliance with the terms of this Consent Judgment and Order.
15. By signing their names to this Consent Judgment and Order, the Parties represent that they are informed and understand the effect and purpose of this Consent Judgment and Order.
16. This Consent Judgment and Order may be executed in counterparts, each of which shall be deemed an original, but all of which taken together, shall constitute one and the same instrument. For purposes of this Consent Judgment and Order, a facsimile signature shall be deemed an original signature with the same force and legal effect.
The Court directs the entry of this Consent Judgment and Order as a final order.
Entry of this Consent Judgment is hereby consented to: Dated: June 26, 2012 M. PATRICIA SMITH Solicitor of Labor JANET M. HEROLD Regional Solicitor DANIEL J. CHASEK Associate Regional Solicitor DANIELLE L. JABERG Counsel for ERISA _______ /s/ Luis A. Garcia _____________ LUIS A. GARCIA, Attorney Attorneys for Plaintiff, U.S. Dept. of Labor
IT IS SO ORDERED.