Federal Court Appoints Trustee To Oversee Abandoned Profit-Sharing Plan

Archived News Release — Caution: Information may be out of date.

A Chicago federal court has appointed M. Larry Lefoldt as the successor trustee to oversee the termination of the pension plan of defunct Asahi, Inc. of Des Plaines, Ill., and to distribute its assets to plan participants, according to a judgment obtained by the U.S. Department of Labor.

Asahi, Inc. was in the business of film development and servicing cameras. The company was involuntarily dissolved by the State of Illinois on May 1, 1999. The profit-sharing plan was created in 1992 by Asahi Services, Inc. However, the plan became an “orphan plan” in July 1998 upon the death of Noboru Tanaka, the plan's sole trustee. As of Sept. 30, 1997, the plan covered 17 participants and had assets of $117,401.57.

Plans become "orphan plans" when they are abandoned by all plan fiduciaries designated to manage and operate the plans and their assets. As a result, participants and beneficiaries are unable to receive pension distributions and to make inquiries about their benefits.

The Labor Department sued Asahi in May of this year for violating the Employee Retirement Income Security Act (ERISA) by leaving the plan without a trustee, failing to appoint a successor trustee to administer the plan, and failing to terminate the plan and distribute individual account balances to participants.

“Our goal is to assure that consumers know that the department is only a phone call away to help protect the benefits promised by employers,” said Ken Bazar, director of the Chicago Regional Office of the department’s Pension and Welfare Benefits Administration. “Employers and workers can reach us at (312) 353-0900 for help with any problems relating to private-sector pension and health plans.”

The judgment, entered on Aug. 15 in federal district court in Chicago resulted from an investigation conducted by the Chicago Regional Office of the department's Pension and Welfare Benefits Administration into alleged violations of ERISA.

(Herman v. Asahi Service, Inc.)
Civil Action No. 00-C-3276

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Archived News Release — Caution: Information may be out of date.