Labor Department Settles Its Lawsuit With Brewster Dairy

Archived News Release — Caution: Information may be out of date.

The U.S. Department of Labor today settled its lawsuit with executives of Brewster Dairy, Inc., in Brewster, Ohio, who agreed to pay $333,333 to the company’s profit sharing plan. These recovered funds and any additional distributions from the limited partnership are to be prorated and allocated to individual accounts of the plan’s eligible participants except for the defendants in the case.

The department’s lawsuit charged the dairy, co-owners Fritz Leeman and Walter Leeman and vice president of finance Thomas Riegler, who acted as plan fiduciaries, with imprudently investing more than $1 million of the company’s plan assets in a real estate limited partnership.

According to the lawsuit, the defendants committed the plan to pay $1,013,115 to purchase units in the Heartland California Clayton Limited Partnership. The plan ultimately invested $749,462.50 in the partnership over the period December 1990 to February 1996. The limited partnership was invested in a parcel of property located in the San Francisco Bay Area. Brewster Dairy was charged with failing to take steps to remedy the improper actions of the individuals who acted as plan fiduciaries.

The settlement and consent judgment resulted from an investigation conducted by the Cincinnati Regional Office of the department’s Pension and Welfare Benefits Administration into alleged violations of the Employee Retirement Income Security Act. The settlement was entered in federal district court on July 1 in Cleveland.

(Herman v. Brewster Dairy, Inc. et al)
Civil Action No. 5:98 CV 744

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Archived News Release — Caution: Information may be out of date.

Contact Name: Sharon Morrissey
Phone Number: 202.219.8921